National Insurance
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A STUDY REPORT ON MARKET POTENTIAL OFOFOF GENERAL INSURANCE BUSINESS AT CHILAKALURIPET AND SURROUNDINGS Submitted to Hon’ble Chairman-Cum-Managing Director National Insurance By K. GANESH BHOOPAL RAO Branch Manager National Insurance Chilakaluripet Branch Office 1 ACKNOWLEDGEMENT This is an occasion to know ourselves and “where we are” in the General Insurance Market in the vicinity. As such I convey my gratitude to our Hon’ble CMD “National Insurance ” for giving me an opportunity to study the potentiality of General Insurance market at Chilakaluripet and surrounding areas. Since this study is going to help me, being a branch manager, in many ways such as knowing ourselves, laying a path to reach the targets, improving the brand image of “ National Insurance ” etc.,. I once again express my gratefulness to our CMD. I thank one and all who helped me in providing the statistical data pertaining to the Insurance market at Chilakaluripet particularly to all the Heads of Branches/Divisions of Public Sector Undertakings at Chilakaluripet. I also acknowledge the support given by our Chief Regional Manager Mr. P. Vijay Kumar and the encouragement given by our DGM Mr. Nadhamuni in preparation of this report. I am deeply indebted to Mr. J. Venkatapathy Rao, AM our BO who extended his helping hand in collecting the statistical data from various sources such as PSUs, DIC and other local sources which enables me in concluding this Report. Finally I thank to Mr. M. Hasanali, Sr. DM, Ongole DO for extending his support in finalizing the report. K. GANESH BHOOPAL RAO Branch Manager, Chilakaluripet BO 2 CONTENTS Page Sl. No Title 1 Acknowledgement 2 2 Objective of this Study: 3 3 Scope of the study 3 4 Introduction to topic 3 5 Scope and limitations 3 6 Actual Potentiality of General Insurance Market at Chilakaluripet: 6 7 Rural Insurance Market: 6 8 Other Personal Line Insurance Prospects: 7 9 Statement showing the premium underwritten by all the Insurance 7 Companies at Chilakaluripet. 10 Data Analysis And Interpretation Observation And Findings 9 11 Summary Of Source Wise And Area Wise Analysis: 13 12 Market Share Analysis (On Total Premium Underwritten Irrespective Of 14 Area) 13 Market Share Analysis (On Premium Procured From Chilakaluripet Area) 14 14 Final Analysis 16 15 Areas Of Opportunities 16 16 What Is Needed To Be Explored? 18 17 National Insurance, Chilakaluripet BO PROFILE 19 18 Method Of Data Collection: 19 19 Conclusion 20 20 List Of Large & Medium Scale Industries Located In The Vicinity Of 21 Chilakaluripet – Annexure-I 21 List Of Small Scale Industries Located In Chilakaluripet And Surrounding 24 Mandals – Annexure-II 3 Objective of this Study: To study the General Insurance Market Potential at Chilakaluripet as directed by the CMD, National Insurance and find out various methods to increase our market share and to tap the untapped business if any. To draw an action Plan for completing the target and to increase the Company’s share at Chilakaluripet: Scope of the study The study of potential of General Insurance business is concerned with market study i.e. Research and fieldwork. This study is going to help the National Insurance to find out Market potential and enables a comparative study with other companies. The study will help the company to assess their performance and improve it where it is lacking. The study of market potential of general insurance at Chilakaluripet is very helpful to find out who are the market leaders in Chilakaluripet as well as overall analysis of potentiality, premium booking, modus operandi of premium procurement, other avenues of penetration into the market, position of the company while comparing other players in the market etc. Availability of time was also taken into account while deciding the particular method to meet the objectives. The entire study programmed was for the period of two weeks. The subject of the study was initiated not only to know the potentiality but also to give suggestions related to the topic. The study limits itself only to find out the General Insurance Market Potentiality at Chilakaluripet. The main objective of this study is to know ourselves as “where we are” in the insurance market. To facilitate the above, a study is initiated namely “A STUDY REPORT ON MARKET POTENTIAL OF GENERAL INSURANCE BUSINESS AT CHILAKALURIPET and its SURROUNDINGS in Guntur district, Andhra Pradesh”. Chilakaluripet is an assembly constituency in Andhra Pradesh. Nearby villages are Thimmapuram, Edlapadu, Ganapavaram, and Nadendla which are Industrial estates in the vicinity . Since we are operating from Chilakaluripet we have taken the area of operation as our study area. The area of operation includes adjacent mandals such as Edlapadu, Nadendla and 4 Prattipadu where many of the annexed industries are located. The main industries are located in Ganapavaram, Thimmapuram, Edlapadu, Boyapalem etc., on the NH-5 towards Guntur City, North East of Chilakaluripet. Map showing Chilakaluripet location on NH-5 surrounded by Ganapavaram, Edlapadu, Thimmapuram, Martur etc. Chilakaluripet has many small scales to medium scale industries. It has many cotton and spinning mills and few cold storages. Geographically the Chilakaluripet is surrounded by Guntur City 40 kms, Narasaraopet is about 20 kms and Martur (Prakasham Dist) is about 15 Kms towards south. It is also famous for jeep building industry. It is a small business centre fulfilling the needs of nearby villages and also has some Hotels and Restaurants. These villages are mainly dependent on agriculture and more particularly they cultivate commercial crops such as Cotton, Chilies and little bit of tobacco. As such there is much cotton, oil, and rice mills have come up in late 80s. At present many number of spinning mills and Cold storage plants have been established in the neighborhood in addition to the Cotton and Ginning and Pressing factories . 5 Keeping in view of the above, we have taken up the study to know the General Insurance Market Potential at Chilakaluripet and segmented the market study in the following areas. 1. Actual Potentiality 2. Total net-worth – Showing the present status in relation to the premium underwritten by all the Insurance Companies at Chilakaluripet 3. Customer behaviour – Discuss about the modus operandi of premium procurement by the Insurance Companies 4. Focus Areas The study undertook for two weeks. As we have to target specifically to various industries located in the vicinity for knowing their net worth, risk factors and premium being paid or premium paying capacity and to know the potentiality. We have spent more than one week for the collection of data and scanning of data. This report shows detail work in the following neighborhood. CHILAKALURIPET GANAPAVARAM NADENDLA THIMMAPURAM EDLAPADU BOYAPALEM PRATTIPADU (Part) 1. Actual Potentiality of General Insurance Market at Chilakaluripet: As stated in foregoing Paras, the Chilakaluripet is an Industrial Area where many major industries are located: The list of Industries annexed herewith as Annexure – I and II. Annexure-I shows that there are about 50 Large Industries are located and approximate premium base of those industries would be around 300 lakhs. Annexure – II shows that there is an investment made in Small and tiny sector is about Rs.50.00 Crore in the area we have selected. Thereby we can assume that the existing General Insurance Premium Income (potentiality) against above portfolio would be about Rs.10.00 Lac in all. The components taken in arriving at such estimated premium income is Property Insurance, Motor Insurance and Personal Line Insurance covers belonging to above SSIs. 6 RURAL INSURANCE MARKET: LIVESTOCK: In Rural Insurance the higher premium income comes from Cattle Insurance in the selected geographical area. As per the information received from Animal Husbandry Department the total population of cattle under above four mandals is about 50000 Animals which includes Dairies also. It is also expected at least 50% of cattle is being insured with various Companies through Dairies as well by Govt. Hence the total potentiality of Cattle premium would be 25000 x 1.80% (the rate at present being charged on the cattle by the Company in Guntur District) = 90.00 lakhs. Therefore the total premium potentiality would be around Rs.1.00 Crore in the vicinity. (However the other players like Oriental is charging @ 1.60% only) JANATHA PERSONAL ACCIDENT, UNIVERSAL HEALTH INSURANCE SCHEME AND OTHER RURAL INSURANCE COVERS: As per the 2001 census and population growth rate for the last 10 years, the above four mandals population is about 4.00 lakhs out of four lakhs population 2.00 lakhs are working men and women. Out of these two lakhs about 80% are engaged in Agricultural activities. If not all the above but at least 50% of them are brought under the Accident & Health Insurance covers, a premium of Rs.20.00 lakhs can be generated. OTHER PERSONAL LINE INSURANCE PROSPECTS: As stated above, out of total populace about 1.50 lakhs are urbanites and literates where we can sell Traffic Accident Policies, PA policies and Health Policies. If we can tap such untapped business starting with 20% of them a premium can be generated @ 1000 per capita amounts to 30.00 lakhs. As such aim of this study is to be Market research & find out the Market Potential of General Insurance business at Chilakaluripet and its surrounding areas. For this we have to know the various sectors of General Insurance Business Sources, modus operandi of booking the premium, Agencies involved in procuring the premium, references etc. So, specifically the target of the project is to focus on tapping of the potentiality and to specify the areas of concentration. To capture the potentiality we have to study the methodology, mechanism and even infrastructure facilities for doing so.