Project

PROMOTIONAL ACTIVITIES ON INSURANCE

(With reference to way2wealth securities pvt.ltd.)

A Project Report submitted to the JNTU, Kakinada, inPartial fulfillment for the award of the Degree of

MASTER OF BUSINESS ADMINISTRATION

SUBMITTED BY

K.S.S. KISHOR KUMARH.T.No:– 08981E0048

UNDER THE GUIDANCE OF

V.D.N. SUBHASHINIAssistant Professor

Dept of P.G. Courses

RAGHU ENGINEERING COLLEGE

Dakamarri – 531 162, Bheemunipatnam Mandal, Visakhapatnam Dist.

2008 – 2010

DECLARATION

I declare that the project entitled “FINANCIAL STATEMENT ANALYIS IN CARE

HOSPITAL, VISAKHAPATNAM” submitted by me for the award of the degree of Master

Of Business Administration (Finance), JNTU university is original and has not been

submitted previously in part or full to this or any university for the award of any degree or

diploma or for any other similar title.

I, D.Siva Kumar, a student of Raghu Engineering College, Dakamarri, pursuing Master Of

Business Administration course here by declare that the project titled “Financial Statement

Analysis” is original work carried out by me availing the guidance of my project guide and to

my satisfaction.

Place : Visakhapatnam

Date : Signature of the Candidate

Name of the Candidate : D.Siva Kumar

H.T. No : 08981E0014

Institution : Department of P.G. Courses,

Raghu Engineering College,

Dakamarri – 531 162,

Bheemunipatnam Mandal,

Visakhapatnam--Dist.

CERTIFICATE

This is to certify that project report entitled “PROMOTIONAL ACTIVATES ON

INSURANCE WITH REFERENCE TO WAY2WEALTH SECURITIES PVT.LTD.” is

a bonefied work done by Mr. K.S.S. KISHOR KUMAR for the award of the degree of

M.B.A JNTU, Kakinada during the academic year 2008-2010, under my supervision and

guidance.

Place: Dakamarri Date:

Signature of the Project Guide Signature of the Project Guide

(External) (Internal)

CERTIFICATE

This is to certify that project report entitled “PROMOTIONAL

ACTIVATES ON INSURANCE WITH REFERENCE TO WAY2WEALTH

SECURITIES PVT.LTD.” as is submitted as partial fulfillment of the requirement for the

award of the Degree of Master of Business Administration of JNTU, Kakinada during the

academic year 2008-2010 by Mr. K.S.S. KISHOR KUMAR (H.T.No:08981E0048).

Place: Dakamarri Date: Head of the Department

ACKNOWLEDGEMENT

I sincerely acknowledge my thanks to Chairman, Raghu Engineering College for giving an

opportunity and lending his support to do the project work.

I sincerely acknowledge my thanks to Principal, Raghu Engineering College for giving an

opportunity and his support to do the project work.

I express my gratitude to Sri P. NARASIMHA, Branch Manager & to J. Satish Kumar

Senior Relationship Manager, way 2 wealth securities pvt. ltd., Visakhapatnam also express

my gratitude to other staff members for their continuous support and encouragement

throughout my project work.

I sincerely acknowledge my thanks to head of the department of management studies, Raghu

engineering college for his cooperation and help throughout my project work.

I am thankful to my project guide Mrs. SHRMA assistant professor for her valuable

guidance and suggestions offered by her during the project work.

I am thankful to all other faculty of my college for their valuable guidance and suggestions

offered by them during the project work.

K.S.S. KISHOR KUMAR

CONTENTChapters PAGE NO.

Chapter – I 7-12

Introduction 7Methodology of study 10Objectives of study 11Need for the study 11Limitation of the study 12

Chapter – II 13- 21

Orginsational Profile 13Mission, vision and objective 14History of the company 17Care Visakhapatnam 20

Chapter – III 22- 33

Theoretical frame work of the topicIntroduction of financial analysis 22Techniques for analysis

Comparative statement analysis 23Common Size statement analysis 24Trend analysis 25Ratio analysis 26

Chapter – IV 34- 82Analysis of study

Chapter – V 83-85Findings 83Suggestions 84Bibliography 85

INTRODUCTION

INTRODUCTION

A small saving play’s major role in development of individuals of individuals as well

as the country. Armature investor faces many problems in choosing his investment part

saving’s obtaining from present consumption for a future use, saving is sometimes

autonomous coming from household as a matter of habit. But bulk of the savings some from

specific objectives, like interest income, future needs, containerizes precautionary purpose or

growth in future wealth, leading to rise in the standard of liking etc.

They are many reasons why people save the money. It all depends on the behavior,

psychology and attitude of the investor. People want to save the money for future risk, better

cushion children’s education, daughter’s marriage, luxury and so on. We can find different

age groups and income we can divide three classes. They are people who have high income

they are treated as higher class; they often look to save the money for luxury. Mostly in this

class they want to buy articles and products (goods or services) to increase and to maintain

their dignity in the society. Secondly, we can find middle class, they are the people mainly

who depends on the employment, few are running the business. They find it necessary to save

the money for their future needs, this class people will plan before the need arises, for

example: for their son’s education or daughter’s marriage and so on. They like to save money

for their future needs. They like to save the money for the future purpose. Lower class family,

the lower class, they cannot afford to save the money but of their income, hardly these people

save the money, but they want to save, according to the situation they save.

Previously investor founds one place to save their money. Mutual funds, banks,

capital market. Post offices, real estates, Gold deposits and etc, it’s not necessary that the

saver have to stick only one area. According to the situation he/she can change the places at

where they want. In the present scenario and in the competitive.

World there is neck-to-neck competition between all the companies. Investors are

selecting the place where they will get the safety of their money. Now days we can find

number of finance companies offering with the high interest rates and attracting the investors.

But at the same they are not fulfilling the commitment’s what they made and not able

maintain the trust. Of course Banks are having high safety bit the returns what they are gibing

is less than the mutual funds are offering good returns and attracting the investors in the

present conditions. Capital market is very risk. Investors are not showing interest towards the

risk, they want tome comfort and at same time their money also should be comfort they are

looking for a place where they will get the maximum return to their investment without any

risk. We can find many people are investing in the Real Estates also. Having a land in the

middle of the city is more than GOLD. But finally in the present Indian Scenario Mutual

funds are growing very rapidly and doing the business well as well as comparing the other

saving industries.

Mutual funds have been around for a long time dating back to the early 19 th century.

The first modern American mutual funds opened in 1924, yet it was only in the 1990’s that

mutual funds became mainstream investment. As the number of households owning them

nearly tripled during that decade. With recent surveys showing that over 88% of all investors

participate in mutual funds, you’re probably already familiar with these investments, or

perhaps even own some. In any case, it’s important that you known exactly how these

investments work and how you these investments work and how you can use them to your

advantage.

A mutual fund is a special type of a company that pools together money from many

investors and invest it on behalf of the group, in accordance with a stated set of objectives.

Mutual fund raise the money by selling shares of the fund to the public; much like any other

company can sell stock in itself to the public. Funds then take the money they receive from

the sale of their shares and use it to,

Purchase various investment vehicles. Such as stocks, Bonds and money

Market instruments: In return for the money they give to the funds when purchasing

shares, shareholders receive an equity position in the fund and, in effect in each of its

underlying securities. For most mutual funds, shareholders are free to sell their shares at any

time, although the price of a share in a mutual fund will fluctuate daily, depending upon the

performance of the security held by the fund.

INVESTMENT SCENARIOS

We can define investment as the process of, “sacrificing something now for the

prospect of gaining something late”.

INVESTMENT OBJECTIVES

Rationally stating, all personal investing is designed in order to achieve a goal. Which

may be tangible (e.g., a car, a house, etc.) or intangible (eg., social status, security, etc.,).

Goals can be classified into various types based on the way investors approach them.

1) Near-term high priority goals

2) Long-term high priority goals

3) Low priority goals

4) Money making goals

INVESTMENT CONSTRAINTS

Investors seeking fulfillment of one of the above goals operates under certain

constraints:

A) Liquidity

B) Age

C) Need for regular income

D) Time horizon

E) Risk tolerance

F) Tax liability

INVESTMENT CLASSIFICATION

This study will concentrate more on the financial investment part and so only

financial instruments are elaborated with a brief introduction to real investments.

OBJECTIVE

Customer mobilization (promoting the product like mutual funds, life and general

insurance).

Recommendation to the customer.

METHODOLOGY

Defining the problem

The first step towards defining a problem is to conduct a research study focusing on

the significance of Mutual Fund in an individual’s life.

Developing the Plan

Once a problem is identified and research objectives clearly stared, the next step is to

prepare a plan for getting the information needed for research.

Source of Data:

The project follows methodology. As part of the process the data collected in the

form of primary data and secondary dat.

Primary Data is collected to get the information regarding customer perception on

Mutual funds with Relevance to Mutual funds. This is done with the help of Questionnaire by

establishing direct contact with the customer.

Secondary data: regarding company profile and Mutual fund industry is collected

from various journals, books and internet branch and subject matter regarding the industry is

collected from related journals, books, internet etc.

SIGNIFICANCE OF STUDY

The main significance of this project is to collect database, tele calling, convince

customers by giving the fair suggestion about financial investments and converted them to

customers of war to wealth. From the study and analysis to know the customer behavior and

experience and to get experience about how to convince the clients who are not interested in

way2wealth securities pvt.ltd.

NEED FOR THE STUDY

The study under taken has revealed the heavy competition in Visakhapatnam.

The studies conducted to create awareness about the company and the products like

Systematic Investment Plan (S.I.P)

Mutual funds

Equity shares

Life and General Insurance

The overall purpose of the study is to create awareness about these products and generating

the leads and recommendations to the existing customers.

COMPANY PROFILE

Way2Wealth today has established itself as one of India’s ‘Premier Investments Consultancy

Firms’, known for making investing simpler, more understandable and profitable for the

investors. They offer a wide range of products & services viz: Equity, Derivatives, Currency

Futures, Commodities Trading, IPO's, Insurance (Life/Non-Life), Mutual Funds, Portfolio

Management Services & Depository Services all under one roof, for the convenience and

benefit of our customers. They service theirr customer relationships through a team of over

1000 wealth managers spread across 100 easily accessible 'Investment Outlets' in almost all

major towns and cities in India.

MISSION

"To be the pre-eminent destination for personalized financial solutions helping individuals

create wealth"

.

PHILOSOPHY

The firm believes that "their knowledge combined with their investors trust and involvement

will lead to the growth of wealth and make it an exciting experience".

LOGO

Blue symbolizes Knowledge.

Red symbolizes Trust.

Yellow symbolizes Excitement and Involvement of the investor.

Green symbolizes Growth.

PARENTAGE AND GROUP COMPANIES

They are part of the ‘Coffee Day Holdings’ a billion $ group, more popularly known for

creating businesses such as ‘Amalgamated Bean Coffee Trading Company Ltd’ and ‘Café

Coffee Day’

GLOBAL TECHNOLOGY VENTURES (GTV) - A company that identifies, invests and

mentors companies engaged in cutting edge technologies. GTV provides access to capital and

resources to companies with global market leadership potential.

AMALGAMATED BEAN COFFEE TRADING COMPANY LTD. (ABCTCL)

India's largest coffee conglomerate and green coffee exporter, ABCTCL is perhaps one of the

two fully integrated coffee companies of Asia, involved in all sectors of Coffee from

plantations to retailing to exports.

CAFÉ COFFEE DAY - India’s largest retail chain of coffee cafes

TANGLIN DEVELOPERS

The real estate company that develops world-class infrastructure facilities for Technology

enterprises, such as ‘Global Village’ on the outskirts of Bangalore, housing companies like

EDS, Mindtree, and ‘TechBay’ on the oceanfront at Mangalore.

WAY2WEALTH LEGACY

Way2Wealth legacy dates back to Sivan Securities (1984) a premier financial intermediary

and incubator for IT start-up firms, spun off its securities broking & investment banking arm

as ‘Way2Wealth’ in 2000 and its venture capital division came to be known as ‘Global

Technology Ventures (GTV)’.

THE VISIONARY

Mr. V.G. Siddhartha, our chairman is the visionary behind Way2Wealth. He has been

involved in the Indian Capital Markets since 1984. His business interests spreads across

Coffee retailing, Plantations, Real estate, Venture Capital and Financial Services.

KEY PEOPLE

Way2Wealth has a very credible management team, with well over 100 man-years of

experience amongst themselves. A strong leadership, respected within industry circles and

recognized among competitors as being formidable and strong, demonstrates high quality and

a visionary management style.

MR. M R SHASHIBHUSHAN - CHIEF EXECUTIVE OFFICER

MR. KETAN SHETH - DIRECTOR (RESEARCH)

SUNIL RAMRAKHIANI - CHIEF OPERATING OFFICER

KISHORE KUMAR, HEAD - PRIMARY MARKETS DIVISION & ONLINE TRADING

ALOK RANJAN, HEAD - PMS

BALAJI G K, HEAD - INVESTING BUSINESS

RIMA SRIVASTAVA, CTO

.

SRINATH B G, HEAD - FINANCE & ACCOUNTS

K P SATHISAN, HEAD - OPERATIONS & RISK MANAGEMENT

PRODUCTS AND SERVICES

The company offers an entire spectrum of investment solutions under a single roof to both

Retail and Corporate Customers through our 100+ Unique Investment Outlets spread across

50 cities across India. With over 24 years expertise in financial services industry, they have

1000+ wealth managers on board advising 100,000+ clients relationships. their network is

further strengthened by over 300+ channel partners for their trading and investment products.

TRADING PRODUCTS

Way2Wealth is a full services broking and advisory house combining the best of tradition

with technology offering traditional broker assisted trading to HNI’s, Individuals and

Corporate along with Online Trading facility to the new generation self-directed customer.

They are members with all major national Exchanges in the country i.e. NSE, BSE, MCX as

well as NCDX, in their respective segments, enabling them to offer trading in:

Equity

Equity Derivatives

Commodity Derivatives, and

Currency Derivatives

At Way2Wealth trading goes one step beyond plain execution being backed by sound

Research, specialized desks for Arbitrage and Premium Broking solutions for customer to

choose from. Trade execution is supported by in-house Depository Services to ensure smooth

and speedy settlement of post-trade activities.

ADVISORY PRODUCTS

The company has significant experience of advising investors through various market cycles.

Their team comprises high quality professionals with experiences spanning assignments in

Asset Management companies, private banking and other financial distributors. Their wealth

managers are trained to offer Financial Planning and end-to-end personalized investment

management services for Wealth Generation, Retirement Planning and Capital Buildup at

different stages of life.

INVESTMENT PRODUCTS

The company has relationships with all major AMCs in the country and leveraging on our

network of wealth managers, and channel partners, distribution of Mutual Funds and

Insurance is a key strength of Way2Wealth.

MUTUAL FUNDS

Advising retail individuals, HNIs and Corporate Treasuries, we offer a choice of mutual

funds spanning all investment objectives and asset classes and have a systematic 4-step

advisory process comprising Background Profiling, Risk Profiling, Model Portfolio Creation,

Review and Rebalancing.

They have a dedicated team of research analysts specializing in mutual funds. Our research

output includes daily performance reports, weekly and monthly updates, special focus articles

as well as quarterly portfolio updates.

INSURANCE

They offer both Life and General Insurance products making us a one-stop shop when it

comes to Insurance and risk management solutions.

Way2Wealth services clients from a variety of backgrounds including retail investors, HNIs

and corporate though a systematic approach adopted by our 300+ well qualified relationship

managers specially trained in insurance advisory.

PORTFOLIO MANAGEMENT

The Portfolio Management Services is an exclusive offering from Way2Wealth that

specializes in providing risk managed investment solutions to discerning High Networth

Individuals, Non Resident Indians (NRIs), Overseas Corporate Bodies (OCBs) and Indian

Corporates.Their Discretionary Portfolio Management Service gives investors the benefit of

unbiased investment advice designed to achieve their financial objectives. In addition to

managing client portfolios, they undertake all operational activities such as custody,

accounting and reporting making it completely hassle free for the customer.

.

CORPORATE ADVISORY

Way2Wealth today services over 200 SMEs and Corporates for their Treasury Management,

Hedging Programs, ESOP Structuring and Employee Tax Planning.

Specifically they offer the following services:

TREASURY MANAGEMENT

W2W advises Institutional and Wholesale investors for their investments in various asset

classes to help manage their Treasuries and optimize the portfolio yields. A structured

methodology is employed for assessment, portfolio modeling, performance measurement and

periodic review.

HEDGING IN COMMODITIES AND CURRENCIES

W2W has a specialized team, with vast experience in domestic and global markets, advising

corporate and SMEs in their hedging programs. They help clients roll out their hedging

policies, define optimum hedge scenarios with due scenario analysis and risk controls. Their

capabilities in technical analysis help in further optimizing the entry and exit points for

successful implementing of hedging strategies.

ESOP PLANNING AND ADVISORY

ESOP planning, structuring and plan execution are important tasks for corporate planning to

issue ESOPs to their employees. They extend comprehensive assistance in the entire process.

Further, they also assist corporate employees in sourcing ESOP loans through their tie-ups.

TAX FILING AND FINANCIAL PLANNING TO EMPLOYEES

Essentially an employee welfare initiative by corporates, They assist this initiative by rolling

out temporary kiosks at work sites during the tax filing season. Corporate employees get spot

advice and assistance in filing and submission of their Income Tax Returns through qualified

chartered accounts.

WAY2WEALTH ADVANTAGE

ADVICE FROM EXPERTS

Their mutual fund team members have significant experience of advising investors through

various market cycles. The team comprises high quality professionals with experiences

spanning assignments in Asset Management companies, private banking and other financial

distributors.

They offer a choice of mutual funds spanning all investment objectives and asset classes.

Their approach to mutual fund investments is advisory based as opposed to transaction based.

The advisory approach is extremely systematic and comprises of the following 4 steps:

Background Profiling : This is done through completion of a questionnaire which

covers demographic as well as financial information.

Risk Profiling : The client’s risk appetite is assessed through proprietary risk

calculator in conjunction with the background profiling

Model Portfolio Creation : Based on the risk profile as well as investment surplus a

model portfolio is suggested to the client. At this stage if the client has an existing

portfolio a restricting is also suggested

Review /Rebalancing : At periodic intervals, the client’s portfolio is reviewed for

concurrence with the investment objectives and rebalanced if required.

RESEARCH

W2W has a dedicated team of research analysts specializing in mutual funds. This is a unique

feature not found in many other firms. The team comprises analysts from different fields such

as economics, statistics and finance among others. This diverse background helps us to

analyze funds and performance on a variety of parameters both conventional as well as

unconventional. They have developed a proprietary ranking of mutual funds which is a

combination of quantitative and qualitative factors. The team is equipped to serve both

institutional and retail clients. Their research includes independent objective analysis as well

as interactions with fund managers and asset management companies.

Their research output includes daily performance reports, weekly and monthly updates,

special focus articles as well as quarterly portfolio updates. The research calls are

disseminated to clients through SMS Alerts, phone and email.

SUPERIOR CLIENT SERVICING

They service clients from a variety of backgrounds including retail investors, HNIs,

corporate, trusts, banks and Government agencies. Premium services customized for the

unique needs of HNI clients are also available. Post account opening, a dedicated

Relationship Manager is assigned to you, who works towards understanding your needs and

ensure the delivery of appropriate products and services. He/she would be the single point of

contact for all our business needs and will keep us updated on the macro developments as

well as on our portfolio performance.

SPECIALIZED CORPORATE ADVISORY DESK

Corporate and Institutions require specialized advisory on treasury strategies. Their team

members on this desk have extensive experience in servicing such clients. In addition they

also have significant expertise in helping employees of Corporate with their financial and tax

planning needs.

ACCOUNT OPENING

To help select the best funds and complete account opening and application:

Call their branch office nearest to us, or Email us at [email protected].

Their relationship manager will get in touch with you to help you select the best fund.

Investment thorough them would involve the 4 steps as mentioned above.They invite

enquires from Corporates and Institutions for their treasury requirements and financial

planning needs of their employees. also invite applications from sub-brokers who would like

to be associated with them

SYSTEMATIC NEEDS BASED APPROACH

Their approach to insurance is advisory based as opposed to selling the highest commission

product. The advisory approach is extremely systematic and comprises of the following 3

steps:

Step 1: Background Profiling: This is done through completion of a questionnaire which

covers demographic as well as financial information.

Step 2: Needs Analysis: The client’s needs like professional and lifestyle goals, education

needs, retirement needs etc. are carefully analyzed in conjunction with the background

profiling.

Step 3: Recommendation: Based on the above 2 steps, a scheme is recommended. In case the

client already has insurance policies, a restructuring is also suggested.

SUPERIOR CUSTOMER SERVICING

They service clients from a variety of backgrounds including retail investors, HNIs and

Corporate. Post recommendation of the scheme, the client is guided through the entire

process of proposal application and medical tests till the policy issuance decision is reached.

Regular updates about the performance of the scheme and renewal intimations are also sent

When claims occur, they interact with the insurance company and expedite timely payment of

claims

GET ADVICE FROM EXPERTS

Their insurance team members have significant experience in the industry. The team

comprises trained and certified professionals with experiences spanning assignments in

insurance companies, underwriting and with other financial distributors. They offer a wide

choice of schemes in life and general insurance spanning all financial needs.

SPECIALIZED CORPORATE ADVISORY DESK

Corporate require specialized advice on their insurance needs like gratuity, superannuation,

key man insurance, health insurance, fire insurance etc. They have experts who can guide the

company on the best alternatives for these needs. This involves a risk assessment of the

business and development of a risk retention and risk transfer strategy.

Despite the deluge of information available online, professional real estate entities

help customers with the right guidance that fit their needs in the lowest possible time. Pan-

India Network through our Branch and Regional offices, help us liaise on your property

requirements across the country.

Micro-Market Knowledge as regards demand, availability, level of transaction

activity, median and average sale price and such other information that is vital in making a

purchase or sale decision.

Negotiation and Confidentiality: Professional entities such as Way2Wealth help

present customer cases in the best light against competing interests and take unemotional

views while negotiating the best deals for their customers.

Paperwork and Legal Clearance: They help with necessary documentation, paperwork

and legal clearances to make your transaction smooth and hassle free.

INDUSTRY PROFILE

A mutual fund is a set up in the form of a trust, which has sponsor, trustees asset

management company (AMC) and custodian. The trust is established by a sponsor or more

than one sponsor who is like promoter of a company. The trustees of the mutual fund hold its

property for the benefit of the unit holders. Asset Management Company approved by

securities exchange board of India managers the funds by making investments in various

types of securities. Custodian, who is registered with SEBI, holds the securities of various

schemes of the fund in its custody. The trustees are vested with the general power of

superintendence and direction over AMC. Monitor the performance and compliance of SEBI

regulations by the mutual fund.

SEBI regulation require that at least two third of the directors of trustee company or

board of trustees must be independent i.e. they should not be associated with the sponsors.

Also, 50% of the directors of AMC must be independent. All mutual funds are required to be

registered with SEBI before they launch any scheme.

HISTORY OF WORLD MUTUAL FUND INDUSTRY

Mutual funds really captured the public attention in the 1980’s and 90’s. When mutual

fund investment hit record highs and investors saw incredible returns. However, the idea of

pooling assets for investment purposes has been around for a long time. Here we look at the

evolution of this investment vehicle from its beginnings in the eighteenth century to its

present status as a growing, international industry with fund holdings accounting for trillions

of dollars in the United States alone.

In the beginning historians are uncertain of the origins of investment funds; some cite

the closed end investment companies launched in the Netherlands in 1822 by King Williams

1 as the first mutual funds, while others point to a Dutch merchant named Adrian Can

Ketwich whose investment trust created in 1774 may have given the king the idea. Van

ketwich probably theorized that diversification would increase the appeal of investments to

smaller investors with minimum capital. The name of can ketwich’s fund, Eendragt maakt

magt, translates to “unity creature’s strength”. The next wave of near mutual funds included

an investment trust launched in Switzerland in 1849, followed by similar vehicles created in

Scotland in the 1880’s.

The idea of pooling Resources and spreading risk using closed end investments soon

took root in Great Britain and France, making its way to the United States in the 1890’s. the

Boston personal property trust. Formed in 1893, was the first closed end fund in the U.S. the

creation of the Alexander fund in Philadelphia, Pennsylvania, in 1907 was an important step

in the evolution toward what we know as the modern mutual fund. The Alexander fund

featured semi-annual issues and allowed investors to make withdrawals on demand.

THE ARRIVAL OF THE MODERN FUND

The creation of the Massachusetts investors trust in Boston, Massachusetts, heralded

the arrival of the modern mutual fund in 1924. The fund went public in 1928, eventually

spawning the mutual fund firm known today as MFS investment management. State street

investors trust. Later, state street investors started its own fund in 1924 with Richard Paine

Richard saltonstal and Paul Cabot at the helm. Saltonstall was also affiliated with scudder,

Stevens and Clark, an outfit that would launch the first no-load fund in 1928. A momentous

year in the history of the mutual fund, 1928 also saw the launch of the Wellington fund,

which was the first mutual fund to include stocks and bonds, as opposed to direct merchant

bank style of investments in business and trade.

RECENT DEVELOPMENT

In 1971, William fouse and John McQueen of wells Fargo bank established the first

index fund, a concept that john boggle would use as a foundation on which to build the

vanguard group, a mutual fund powerhouse renowned for low-cost index funds. The 1970s

also saw the rise of the no-load fund. This new way of doing business had an enormous

impact on the way mutual funds were sold and would make a major contribution to the

industry’s success with the 1980 and 90 came bull market mania and previously obscure

fund managers became superstars; Max Heine, Michael. Price and Peter Lynch, the mutual

fund industry’s top gunslingers, became household names and money poured into the retail

investment industry at a stunning pace. More recently, the burst of the tech bubble and a spate

of scandals involving big names in the industry took much if the shine off of the industry’s

reputation. Shady dealings at major fund companies demonstrated that mutual funds aren’t

always begin investments managed by folks who have their shareholders best interests in

mind and who treat all investors equally.

HISTORY OF THE INDIAN MUTUAL FUND INDUSTRY

The mutual fund industry in India started in 1963 with the formation of Unit Trust of

India, at the initiative of the Government of India and Reserve Bank. The history of mutual

funds in India can be broadly divided into four distinct phases.

FIRST PHASE- 1964-87

Unit trust of India (UTI) was established on 1963 by an Act of Parliament. It was set

up by the Reserve Bank of India and functioned under Regulatory and administrative control

of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial

Development bank of India (IDBI) took over took over the regulatory and administrative

control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end

of 1988 UTI had Rs. 6,700 Crores of assets under management.

SECOND PHASE – 1987-93 (ENTRY OF PUBLIC SECTOR FUNDS)

1987 marked the entry of non-UTI, public sector mutual funds set up by public sector

banks and life insurance Corporation of India (LIC) and General Insurance Corporation of

India (GIC). SBI mutual fund was the first non UTI mutual fund established in June 1987

followed by Canara Bank Mutual Fund (Dec 87), Punjab national bank mutual fund (Aug

89), Indian bank mutual fund(Nov 89).

India (June 90), Bank of Baroda mutual fund (Oct 92). LIC established its mutual

fund in June 1989 while GIC had set up its mutual fund in December 1990. At the end of

1993, the mutual fund industry had assets under management of Rs. 47,004 Crores.

THIRD PHASE 1993-2003 (ENTRY OF PRIVATE SECTOR FUNDS)

With the entry of private sector funds in 1993, a new era started in the Indian mutual

fund industry, giving the Indian investors a wider choice of fund families. Also 1993 was the

year in which the first Mutual fund regulations came into being, under which all mutual

funds, except UTI were to be registered and governed. The erstwhile Kothari pioneer (now

merged with Franklin Templeton) was the first private sector mutual fund registered in July

1993.

The 1993 SEBI (mutual fund) Regulations were substituted by a more comprehensive

and revised mutual fund regulations in 1996. The industry now functions under the SEBI

(mutual fund) regulations 1996.

The number of mutual fund housed went on increasing, with many foreign mutual

funds settings up funds in India and also the industry had witnessed several mergers and

acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets of

RS 1,21,805 crores. The unit trust of India with Rs 44,541 crores of assets under management

was way ahead of other mutual funds.

FOURTH PHASE – SINCE FEBRUARY 2003

In February 2003, following the repeal of the Unit trust in India Act 1963 UTI was

bifurcated into two separate entities. One is the specified Undertaking of the Unit Trust of

India with assets under management of Rs.29,835 crore as at the end of January 2003,

representing broadly, the assets of US 64 scheme, assured return and certain other schemes.

The specified Undertaking of Unit Trust of India, functioning under an administrator and

under the rules framed by Government of India and does not come under the purview of the

mutual fund regulations.

The second is the UTI mutual fund ltd, sponsored by SBI, PNB, BOB and LIC. It is

registered with SEBI and functions under the mutual fund regulations. With the bifurcation of

the erstwhile UTI which has in March 2000 more than Rs. 76,000 crores of assets under

management and with the setting up of a UTI mutual fund, Conforming to the SEBI mutual

fund regulations, and with recent mergers taking place among different private sector funds,

the mutual fund industry has entered its current phase of consolidation and growth.

MUTUAL FUND AS AN INVESTMENT OPTION:

We have already mentioned that like all other investments in equities and debts, the

investments in mutual fund also carry risk.

However your investment will be managed by professional financial manger. Who are

in a better position to assess the risk profile of the investments. Your small investment cannot

be spread into equity shares of various good companies due to high price of such shares.

Mutual funds are in a much better position to effectively spread your investment across

various sectors and among several products available in the market. This is called risk.

Diversification and can effectively shied the steep slide in the value of your investment.

TYPES OF MUTUAL FUND SHCEME:

Mutual fund schemes may be classified on the basis of its structure and its investment

objective.

Open-end funds: An open-end fund is one that is available for subscription all through the

year. These do not have a fixed maturity. Investors can conveniently but and sell units at Net

Asset Value (NAV) related prices. The key feature of open-end schemes is liquidity.

Closed-end funds: A closed-end fund has a stipulated maturity period which generally

ranging from 3 to 15 years. The fund is open for subscription only during a specified period.

Investors can invest in the scheme at the time of the initial public issue and thereafter they

can buy or sell the units of the schemes on the stock exchanges where they are listed. In order

to provide and exit route to the mutual fund through periodic repurchase at NAV related

prices. SEBI regulations stipulate that at least one of the two exists route is provided to the

investor.

Net Asset Value: The performance of a particular scheme of a mutual fund is denoted by Net

Asset Value (NAV).

Mutual funds invest the money collected from the investors in securities markets. In

simple words, Net Asset value is the market value of the securities held by the scheme. Since

market value is the market value of the securities held by the scheme. Since market value of

securities changes every day. NAV of a scheme also varies on day-to-day basis. The NAV

per unit is the market values of securities of a scheme on any particular date. For example, if

the market value of a mutual fund scheme is Rs.200 Lakhs and the mutual fund has issued 10

lakhs units of Rs.10 each to the investors then the NAV per unit of the fund is Rs.20. NAV is

required to be disclosed by the mutual funds on a regular basis – daily or weekly – depending

on the type of scheme.

The net asset value of the fund is the cumulative market value of the assets fund net of

its liabilities. In other words, if the fund is dissolved or liquidated, by selling off al the assets

in the fund, this is the amount that the shareholders would collectively own. This given rise to

the concept of net Asset value per unit, which is the value represented by the ownership of

one unit in the fund. It is calculated simply by dividing the net asset value of the fund by the

number of units. However, most people refer loosely to the NAV per unit as NAV, ignoring

the “per unit”. We also abide by the same convention.

NAV = (Total Assets – Total Liabilities )/No. of shares outstanding types of mutual funds

Mutual funds can be classified based on their objectives as:

Sector equity scheme

Diversified equity scheme

Hybrid scheme

Income scheme

Money market scheme

Sector equity scheme: these schemes invest in shares of companies in a specific sector. This

could be an industry or a group of industries or various segments as a “A” group shares.

Diversified equity scheme: These schemes invest in shares of companies across different

sector of the economy.

Hybrid scheme: These schemes invest in a mix of share and fixed income instruments.

Income scheme: These schemes invest in fixed income instruments such as bonds issued by

corporate and financial institutions and government securities.

Money market scheme: These schemes invest in short term instruments such as certificate

of deposits, Treasury bill and short term bonds.

ADVANTAGES OF MUTUAL FUND

Professional management: Mutual funds provide the services of experienced and skilled

professions, backed by a dedicated investment research team analyses the performance and

prospects of companies and selects suitable investments to achieve the objectives of the

scheme.

Diversification: Mutual funds invest in a number of companies across a broad cross-section

of industries and sectors. This diversification reduces the risk because seldom do a stocks

decline at the same time and in the same proportion. You achieve this diversification through

a mutual fund with far less money than you can do on your own.

Convenient administration: Investment in a mutual fund reduces paperwork and helps you

avoid many problems such as bad deliveries, delayed payments and follow up with brokers

and companies. Mutual funds save your time and make investing easy and convenient.

Return potential: Over a medium to long-term, mutual funds have the potential to provide a

higher return as they invest in a diversified basket of selected securities.

Low costs: Mutual funds are a relatively less expensive way to invest compared to directly

investing in the capital markets because the benefits of scale in brokerage, custodial and other

fees translate into lower costs for investors.

Liquidity: In open end schemes, the investor gets the money back promptly at net asset value

related prices from the mutual fund. In closed end schemes, the units can be sold in stock

exchange at the prevailing market price or the investor can avail of the facility of direct

repurchase at NAV related prices by the mutual fund.

Transparency: You get regular information o the value of your investment in addition to

disclosure on the specific investments made by your scheme, the proportion invested in each

class of assets and the fund manager’s investment strategy and outlook.

Flexibility: Through features such as regular investment plans , regular withdrawal plans and

dividend reinvestment plans, you can systematically invest or withdraw funds according to

your needs and convenience.

Affordability: Investors individually may lack sufficient funds to invest in high grade stocks.

A mutual fund because of its large corpus allows even a small investor to take the benefit of

its investment strategy.

Choice of schemes: Mutual funds offer a family of schemes to suit your varying needs over a

lifetime.

Well regulated: All mutual funds are registered with SEBI and they function within the

provisions of strict regulations designed to protect the interests of investors. The operations of

mutual funds are regularly monitored by SEBI.

Future scenario:

The asset base will continue to grow at an annual rate of about 30 to 35% over the

next few years as investor’s shift their assets from banks and other traditional avenues. Some

of the older public and private sector players will either close shop or be taken over.

Out of ten public sector players five will sell out, close down or merger with stronger

players in three to four years. In the private sector this trend has already started with two

mergers and one takeover. Here too some of them will down their shitters in the near future to

come.

But this does not mean there is no room for other players. The market will witness a

flurry of new players entering the arena. There will be a large number of offers from various

asset management companies in the time to come. Some big names like fidelity, principal and

old mutual etc., are looking at Indian market seriously. One important reason for it is that

most major players already have presence here and hence these big names would hardly like

to get left behind. The mutual fund industry is awaiting the introduction of derivatives in

India as this would enable it to hedge its risk and the in turn would be reflected in its Net

asset value (NAV).

SEBI is working out the norms for enabling the existing mutual fund schemes t trade

in derivatives. Importantly, many market players have called on the Regulator to process

immediately, so that the mutual funds can implement the changes that are required to trade in

derivatives.

INDIAN INSURANCE INDUSTRY:

Insurance industry, as on 1-4-2000, comprised mainly two players: the state insurers.

Life insurers:

Life Insurance Corporation of India (LIC).

General insurers:

General Insurance Corporation of India (GIC) (with effect from Dec 2000, a national

reinsure)

GIC had four subsidiary companies, namely (with effect from Dec 2000, these subsidiaries

have been de-linked from the parent company and made as independent insurance companies.

The oriental insurance company limited

The new India assurance company limited

National insurance company limited

United India insurance company limited

Yr: 2000 - 2001: (from 2nd April 2000 to 31st December 2001)

Insurance Industry in the year 2000-2001 had 16 new entrants, namely:

Life insurers:

S.No Registr

ation

Date of reg. Name of the company

1 101 23-10-2000 HDFC Standard Life Insurance Company Ltd.

2 104 15-11-2000 Max New York Life Insurance Company Ltd.

3 105 24-11-2000 ICICI Prudential Life Insurance Company Ltd.

4 107 10-01-2001 Kotak Mahindra Old Mutual Life Insurance Ltd.

5 109 31-01-2001 Birla Sun Life Insurance Company Ltd.

6 110 12-02-2001 Tata AIG Life Insurance Company Ltd.

7 111 30-03-2001 SBI Life Insurance Company Ltd.

8 114 02-08-2001 ING Vysya Life Insurance Company private Ltd.

9 116 03-08-2001 Bajaj Allianz Life Insurance Company Ltd.

10 117 06-08-2001 Metlife India Insurance Company Pvt. Ltd.

General insurers:

S.NO Registr

ation


1 102 23-10-2000 Royal Sundaram Alliance Insurance Company Ltd.

2 103 23-10-2000 Reliance General Insurance Company Ltd.

3 106 04-12-2000 IFFCO Tokio General Insurance Company Ltd.

4 108 22-01-2001 TATA AIG General Insurance Company Ltd.

5 113 02-05-2001 Bajaj Allianz General Insurance Company Ltd.

6 115 03-08-2001 ICICI Lombard General Insurance Company Ltd.

Year : 2001-02: (from 1st Jan 2001 to Dec.2002)

Insurance industry in this year, so far has 5 new entrants; namely

Life insurers:

S.No Registration Date of reg. Name of the company

1. 121 03-01-2002 AMP Sanmar life insurance company ltd.

2. 122 14-05-2002 Aviva life insurance co.India pvt.ltd.

General insurers:

S.No Registr

ation


1. 123 15-07-2002 Cholamandalam general insurance company ltd.

2. 124 27-08-2002 Export Credit Guarantee Corporation ltd.

3. 125 27-08-2002 HDFC-Chubb general insurance co.ltd.

Year 2003-04: (from 1st Jan 2003 till date)



1 127 06-02-2004 Sahara India Insurance company ltd.

Year 2004-05:



1 128 17-11-2005 Shriram life Insurance company ltd.

INSURANCE BUSINESS:

Insurance business is divided into four classes:

1) Life Insurance

2) Fire Insurance

3) Marine Insurance

4) Miscellaneous Insurance

Life Insurers transact life insurance business; General Insurers transact the rest. No

composites are permitted as per law.

LEGISLATION (as on 1-4-2000)

Insurance is a federal subject in India. The primary legislation that deals with insurance

business in India is:

Insurance Act, 1938, and Insurance Regulatory and development authority act, 1999.

INSURANCE PRODUCTS (as on 1-4-2000)

Far latest information get in touch with the current insurers.

LIFE INSURANCE:

Popular products: Endowment Assurance (Participating), and Money back . more than

80% of the life insurance business is from these products.

GENERAL INSURANCE:

Fire and miscellaneous insurance businesses are predominant. Motor vehicle

insurance is compulsory.

Tariff Advisory Committee (TAC) lays down tariff rates for some of the general insurance

products 2001.

New products have been launched by life insurers. These include linked products.

INFORMATION

About the insurance industry, the following documents may be helpful:

Malhotra committee report (the report of the committee on reforms in the insurance sector)

IRDA’S first annual report-2001

CUSTOMER PROTECTION:

Insurance industry has Ombudsmen in 12 cities. Each Ombudsman is empowered to redress

customer grievances in respect of insurance contracts on personal lines where the insured

amount is less than Rs. 20 lakhs, in accordance with the Ombudsman Scheme. Addresses can

be obtained from the offices of LIC and other insurers.

Composition of Authority under IRDA Act, 1999.

As per the section 4 of IRDA Act, 1994, Insurance Regulatory and Development Authority

(IRDA, which was constituted by an act of parliament) specify the composition of Authority.

The Authority is a ten member team consisting of

a) A Chairman

b) Five whole-time members

c) Four part-time members

(all appointed by the government of India)

Products offered by Life Insurers, list of insurers

Sr.no Name of the company

1 Bajaj Allianz Life Insurance Company Ltd

2 Birla Sun Life Insurance Company Ltd

3 HDFC Standard

4 ICICI Prudential

5 ING Vysya

6 Life Insurance corporation of india

7 Max New Yor

8 Met life India life insurance company ltd

9 Kotak Mahindra old mutual life insurance company ltd

10 SBI life insurance company ltd

11 Tata AIG life insurance company ltd

12 Reliance life insurance company ltd

13 Aviva life insurance company ltd

14 Sahara India life insurance company ltd

15 Shriram life insurance company ltd

16 Bharti AXA life insurance company ltd

Please note:

For every product/rider, there is a UIN (Unique Identification Number) allotted by

IRDA. For every product/rider offered for sale, there should be corresponding UIN provided.

The Government of India has enacted the right to information act, 2004 which has

come into effect from October 13, 2005. The right to information under this act is meant to

give to the citizens of India access to information under control of public authorities to

promote transparency and accountability in these organizations. The Act, under Sections 8

and 9, provides for certain categories of information to be exempt from disclosure. The act

also provides for appointment of a Chief Public Information Officer to deal with requests for

information.

IRDA’s obligation under the act

The insurance regulatory and development authority (IRDA) is a public authority as

defined in the right to information act, 2005. As such, the insurance regulatory and

development authority is obliged to provide information to members of public accordance

with the provisions of the said act.

Access to the information held by IRDA

The right to information includes access to the information which is held by or under

the control of any public authority and includes the right to inspect the work, document,

records, taking notes, extracts or certified copies of documents/records and certified samples

of the materials and obtaining information which is also stored in electronic form.

IRDA website

The IRDA maintains an active website (URL:http://www.irdaindia.org). The site is

updated regularly and all the information released by the IRDA is also simultaneously made

available on the website. The information published in public domain inclide the following:

1. Acts/regulations

2. Information relating to insurers/reinsurers, agents training institutes, appointed

actuaries.

3. Information relating to Surveyors, third party administrators, insurance brokers,

corporate agents.

4. Information relating to insurance councils, insurance ombudsmen

5. Annual report/IRDA journal

6. Press releases.

COMPLAINTS AGAINST INSURANCE COMPANIES

IRDA has provided for a separate channel for lodging complaints against deficiency of

services rendered by insurance companies. If you have a complaint against an insurance

company for poor quality of services rendered by any of its offices, please approach the

Nodal Officer of the insurance company concerned. In case you are not satisfied with the

insurance company’s response you may also file a complaint with the insurance ombudsman

in your state. The insurance ombudsman is an independent office to provide speedy and cost

effective resolution of grievances to the customers.

COMPLAINTS FRO POLICY HOLDERS

Policy holders who have complaints against insurers are required to first approach the

customer complaints cell of the concerned insurer. It they do not receive a response from

insurer within a reasonable period of time or are dissatisfied with the response of the

company they may approach the grievance cell of the IRDA.

Making an application under the right to information act, 2005

Citizens of India will have to make the request for information in writing, clearly specifying

the information sought under the right to information act, 2005. The application for request

url:http://www.irdaindia.org

should give the contact details, so that the applications can be contacted for clarifications or

further information. As per the act, information can be furnished only to citizens of India but

not to others.

How do I send my application?

As per the right to information (regulation of fee and cost) Rules, 2005 prescribed by the

Government of India: a request for obtaining information under section 6(1) of RIA needs to

be accompanied by an application fee of Rs.10 by way of cash against proper receipt or by

DD or bankers cheque.

You could send your request by post accompanied by the application fee of Rs.10/- payable

by demand draft or banker’s cheque favoring insurance regulatory and development

authority. The fee can also be paid in cash along take up the application for consideration, as

required under the act, only after the application fee has been received.

HISTORY OF INSURANCE

The story of insurance is probably as old as the story of mankind. The same instinct that

prompts modern businessmen today to secure themselves against loss and disaster existed in

primitive men also. They too sought to avert the evil consequences of fire and flood and loss

of life and were willing to make some sort of sacrifice in order to achieve security. Though

the concept of insurance is largely a development of the recent past, particularly after the

industrial era past few centuries- yet its beginnings date back almost 6000 years.

Life insurance in its modern form came to India form England in the year 1818.

Oriental Life Insurance Company started by Europeans in Calcutta was the first life insurance

company on Indian soil. All the insurance companies established during that period were

brought up with the purpose of looking after the needs of European community and Indian

native era not being insured by these companies. However, later with the efforts of eminent

people like Baby Muttylal seal, the foreign life insurance companies started insuring Indian

lives. Nit Indian lives were being treated as sub-standard lives and hear by extra premiums

were being charge on the. Bombay Mutual life assurance society heralded the birth of first

Indian life insurance company in the year 1870, and covered Indian lives at normal rates.

Starting as an Indian enterprise with highly patriotic motives, Insurance companies came into

existence to carry the message of insurance and social security through insurance to various

sectors of society. Bharat insurance company (1896) was also one of such companies inspired

by nationalism. The Swadeshi movement of 1905-07 gave rise to more insurance companies.

The United India in Madras, National Indian, National insurance in Calcutta and the Co-

operative assurance at Lahore were established in 1906. In 1907, Hindustan Co-operative

insurance company took its birth in one of the rooms of the Jorasanko, house of the great poet

Rabindranath Tagore, in Calcutta.

The Indian Mercantile, General assurance and Swadeshi life were some of the companies

established during the same period. Prior to 1912 India had no legislation to regulate

insurance business. In the year 1912, the Life Insurance Companies act and the provident

fund act were passed. The life insurance companies act, 1912 made it necessary that the

premium rate tables and periodical valuation of companies should be certified by an actuary.

But the act discriminated between foreign and Indian companies on many accounts, putting

the Indian companies at a disadvantage.

The first two decades of the twentieth century saw lot of growth in insurance business. From

44 companies with total business-in-force as Rs.22.44 crore, it rose to 176 companies with

total business in force as Rs.298 crore in 1938. During the mushrooming of insurance

companies man financially unsound concerns were also floated which failed miserable. The

insurance act 1938 was the first legislation governing not only life insurance but also non-life

insurance to provide strict state control over insurance business. The demand for

nationalization of life insurance industry was made repeatedly in the past but it gathered

momentum in 1994 when a bill to amend the life insurance act 1938 was introduced in the

legislative assembly. However, it was much later on the 19th of January, 1956, that life

insurance in India was nationalized. About 154 Indian insurance companies, 16 non-Indian

companies and 75 provident were operating in India at the time of nationalization.

Nationalization was accomplished in two stages; initially the management of the companies

was taken over by means of an Ordinance, and later, the ownership too by means of a

comprehensive bill. The parliament of India passed the life insurance corporation act on the

19th of June 1956, and the life insurance corporation of India was created on 1st September,

1956, with the objective of spreading life insurance much more widely and in particular to the

rural areas with a view to reach all insurable persons in the country, providing them adequate

financial cover at a reasonable cost.

LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart from its corporate

office in the year 1956. Since life insurance contracts are long term contracts and during the

currency of the policy it requires a variety of services need was felt in the later years to

expand the operations and place a branch office at each district headquarter. Re-organization

of LIC tool place and large numbers of new branch offices were opened. As a result of re-

organization servicing functions were transferred to the branches, and branches were made

accounting units. It worked wonders with the performance of the corporation. It may be seen

that from about 200 crores of new business in 1957 the corporation crossed 1000 crores only

in the year 1969-70, and it took another 10 years for LIC to cross 2000 crore mark of new

business. But with re-organization happening in the early eighties, by 1985-86 LIC had

already crossed 7000 crore Sum assured on new policies.

Today LIC functions with 2048 fully computerized branch offices, 100 divisional offices, 7

zonal offices and the corporate office. LIC’s wide area network covers 100 divisional offices

and connects all the branches through a metro area network. LIC has tied up with some banks

and service providers to offer on-line premium facility is an addition to customer

convenience, apart from on-line Kiosks and IVRS, info centers have been commissioned at

Mumbai, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, New Delhi, Pune and many

others cities. With a vision of providing easy access to its policy holders, LIC has launched

its SATELLITE SAMPARK offices; the satellite offices are smaller, leaner and closer to the

customer. The digitalized records of the satellite offices will facilitate anywhere servicing and

many other conveniences in the future.

LIC continues to be the dominant life insurer even In the liberalized scenario of Indian

insurance and is moving fast on a new growth trajectory surpassing its own past records. LIC

has issued over one crore policies during the current year. It has crossed the milestone of

issuing 1, 01, 32,955 new policies by 15th Oct, 2005, posting a healthy growth rate of 16.67%

over the corresponding period of the previous year.

From then to now, LIC has crossed many milestones and has set unprecedented

performance records in various aspects of life insurance business. The same motives which

inspired our forefathers to bring insurance into existence in this country inspires us at LIC to

take this message of protection to light the lamps of security in as many homes as possible

and to help the people in providing security to their families.

Some of the important milestones in the life insurance business in India are:

1818: oriental Life insurance company, the first life insurance company in Indian soil started

functioning.

1870: Bombay Mutual Life assurance society, the first Indian life insurance company started

its business.

1912: The Indian life assurance companies act enacted as the first statute to regulate the life

insurance business.

1928: The Indian insurance companies act enacted to enable the government to collect

statistical information about both life and non-life insurance businesses.

1938: Earlier legislation consolidated and amended to by the Insurance act with the objective

of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies are taken over by the central

government and nationalized. LIC formed by an act of parliament, viz. LIC act 1956, with a

capital contribution of Rs. 5 crore from the government of India.

The General insurance business in India, on the other hand, can trave its roots to the Triton

Insurance company Ltd., the first general insurance company established in the year 1850 in

Calcutta by the British.

Some of the important milestones in the general insurance business I India are:

1907: The Indian Mercantile Insurance Ltd. Set up, the first company to transact all classes of

general insurance business.

1957: General insurance council, a wing of the insurance association of India, frames a code

of conduct for ensuring fair conduct and sound business practices.

1968: The insurance act amended to regulate investments and set minimum solvency margins

and the Tariff Advisory Committee set up.

1972: The general insurance business (Nationalization) act, 1972 nationalized the general

insurance business in India with effect from 1st January 1973. 107 insurers amalgamated and

grouped into four companies viz. the National insurance company ltd., the New India

assurance company ltd. The Oriental insurance company ltd. And the United India insurance

company ltd GIC incur ltd. GIC incorporated as a company.

ANALYSIS OF THE WORK

DATA ANALYSIS

This data analysis tool the place in project work analyze data which is collected from the

survey reports. It is essential for know the investors prospects in different concerns and views

and it would helpful to the surveyor to analysis market position and its trends. Here as a

survey I took the sample size is 150. This analyzes goes in touching different corners of

investors. This analyze as follows given below.

N=150

N = sample size

TABLE-1

PREFERENCE OF INVESTMENT OF PLANS(S):

Investment plans No of people preference % of preference

Mutual funds 26 20.31

Insurance 11 7

Real estates 06 4

Bank F.D’s 35 27

Gold deposits 09 7

Post of savings 11 8.5

Stock market 19 14.8

Others 14 10.9

GRAPH-1

Table and graph 1 show that investor’s investment preference among the Bank deposit and

mutual fund took the first and second place respectively.

TABLE - 2

Investment preference No. of people preference % of preference

Safety 43 33.59

liquidity 21 14.48

Diversification 06 5.08

More returns 21 16.01

Tax benefits 28 21.87

Others 12 8.59

GRAPH-2

Table and graph 2 shows that there was various factors of investment point of view in opting

different investment plans, investment gives top priority to safety representing for their

investment later they are looking for more returns and tax benefit respectively. In this area

investor doesn’t give any preference to the diversification. Investors leastly give the priority

liquidity as one of the reasons.

TABLE – 3

Investment preference No. of people preference % of preference

Mutual funds 15 16.39

Insurance 08 8.7

Real estates 04 4.3

Bank F.D’s 25 26.2

Gold deposits 10 8.7

Postal savings 11 12

Stock market 09 9.8

Others 13 13.6

GRAPH - 3

Table and graph 3 shows that investors are more interested in bank deposits and

mutual fund respectively. (26.2%, 16.39%). Real estate’s (4.3%), insurance (8.7%), gold

deposit (8.7%), postal saving (12%), stock market (9.2%), others (13.6%)

TABLE – 4

INVESTERS INVESTMENT SATISFACTION

YES 83 63.35%

NO 48 36.65%

TOTAL 131 100%

GRAPH - 4

There are 63% satisfaction and 37% are not satisfaction.

TABLE - 5

NO OF PEOPLE AWARDED ON EQUITY

YES 34 25.9%

NO 97 74.1%

TOTAL 131 100%

GRAPH-6

Table and graph shows that people awareness on equity shares 25.9% and not aware about

equity is 74.1%.

TABLE – 6

NO OF PEOPLE AWARDED ON EQUITY

YES 28 21.37%

NO 103 78.63%

TOTAL 131 100%

GRAPH - 6

Above table and graph 6 shows that respondents awareness about 21.37% and not aware is

78.63%.

TABLE – 7

PEOPLE AWARENESS OF WAY 2WEALTH

YES 25 19.08%

NO 106 80.02%

TOTAL 131 100%

GRAPH - 7

CONTRIBUTION

CONTRIBUTION

We collected the data base of 875 people

Out of 825, 713 were responded

We contributed Rs.2, 30, 000 premiums towards company

SUGGESTIONS

SUGGESTIONS

Company should concentrate on remaining places in the city like Gajuwaka,

Anakapalli.

Conduct awareness camps in the different areas of the city.

More concentration of the post services.

Way2wealth needs to built company awareness as well as product awareness.

Project

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