Chapter:-1

Introduction

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INTRODUCTION

1.1BACKGROUND OF THE STUDY

People constantly face a number of risks but are unaware of the dangers they are in until something major

happens to them. These include risk to one’s health - illness, accident or risk to ones property - fire,

burglary, earthquake etc. Insurance covers all such risks over which one has no control and that too at a

very low cost.  As responsible members of a family, one should be adequately prepared to manage these

risks.

Similarly a shop owner will take great pride in his establishment as it has been built up to its present glory

due to a lot of hard work and sacrifice on his part and hence he may have worries about the dangers his

shop and its contents are exposed to. Theft, an employee’s infidelity, a fire accident – such unfortunate

events can most certainly hamper the smooth running of the sales premises. That is why a protective

cover like a comprehensive policy cover to protect the shop building, its contents and the peace of mind

of its owners is required. Hence, shop insurance is required to cover the losses that arise due to a wide

variety of perils. Shop insurance is specially designed to meet the needs of small shopkeepers. It is a

comprehensive commercial insurance policy, catering to different insurance needs of shopkeepers.

MEANING OF SHOP INSURANCE

If you own a shop, you will obviously be concerned about its safety as well as the merchandise stored in

it. After all, it is your livelihood that is being talked here. You have the grocery store with a bakery

counter, the vegetable shop that has a non-veg counter, or the paan-shop that doubles up as a mobile-

recharge center. Versatility being the name of the game, it is only natural that insurers have come up with

a range of covers for the discerning shop owner

A number of insurance companies in India have come up with attractive insurance policies for people

owning small or medium-sized shops known as ‘shop insurance’. It covers all the risks and contingencies

faced by small or medium- sized shop owners. In addition to this, the policy provides protection for the

property and the interests of the shop owners (including their partners) in the business venture, who has

applied for the insurance cover. Hence it is also known as ‘shopkeeper’s insurance policy’. It is a package

policy for commercial shops, aimed at both independent shopkeepers and franchised retailers including

single shops and portfolios.

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1.2 STATEMENT OF PROBLEM

Take necessary steps to minimize the loss/damage. In case of fire, inform fire brigade immediately. In case of theft, larceny or burglary inform the police immediately along with a list of items stolen and their approximate value. Inform insurance company by phone or fax and in writing. Extend full co-operation to the surveyor appointed by the insurance Co. and provide necessary documents to substantiate the loss. A claim form issued by the company is also to be submitted. In case any rights of recovery exist against any other party responsible for the loss, your rights of recovery have to be subrogated to the insurance company on payment of claim.

1.3 CONCEPT

Burglary & HousebreakingCovers contents of insured shop premises (excluding money and valuables) against loss or damage by burglary and/or housebreaking.

Money InsuranceCovers loss of money in transit, loss of money/valuables whilst contained in a locked safe, loss of money contained in cashiers till and/or counter by burglary/housebreaking.

Plate GlassCovers loss of or damage to fixed plate glass in insured's shop by accidental means.

BaggageCovers loss or damage to accompanied personal baggage of insured or baggage in connection with his trade, whilst anywhere in India, by accident or misfortune

Personal AccidentCovers insured and spouse and/or his children, named in the schedule and aged between 5&70 years, against bodily injury caused solely and directly by accident and resulting in death or permanent total or partial disablement or temporary total disablement within 12 calendar months of such injury.

1.4 OBJECTIVE OF THE STUDY

The main aim of the project is to understand and study the concept of shop insurance in detail. The main

objectives of the project’s study are:

To understand the concept of shop insurance and its relevance in the insurance sector,

To outline the benefits and limitations of taking out the policy to the customers of various

categories,

To establish the reasons for non-popularity of the policy among the public and

To ascertain the need and reasons of the customers for including those risks that are not included

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1.5 HYPOTHESIS

Research Hypothesis:

The new India assurance company limited shopkeeper’s policy in performing well in Mumbai.

Null hypothesis:

Shopkeeper’s insurance policy of the new India assurance company limited is not effective in Mumbai

region.

1.6 MAJOR ASSUMPTION BEHIND THE STUDY

This policy can be taken by small shopkeepers whose shop building value and contents value does

not exceed Rs. 10 lacs.

In case it exceeds Rs.10 lacs, this policy cannot be given. This policy is meant for shops only.

Mere registration under Shops and Establishment Act does not entitle the premises to be insured

under this policy.

Hence Restaurants and Tea /Coffee shops cannot be insured under this policy. However, shops

selling goods where minor repair work is carried on incidental to the main business of selling, can

take this policy.

1.7 RESEARCH QUESTION

There are some people to be taken shopkeeper insurance policy in Dombivli areas.

1.8 METHODOLOGY

For making this successful and worth, a questionnaire was structure .through the help of the questionnaire

primary data has been collected. Questionnaire has been filled from 50 responses.

The research also includes secondary data which has been collected from various website, journal,

newspaper etc.

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1.9 SCOPE OF THE STUDY

The researcher is conducted in the area of thane .the survey method has been followed for the study well-

structure questionnaire is designed to necessary data and details from c1.10 customers .the data was

collected selectively.

1.10 LIMITATION

Due to time constraint, only one company and twenty samples were considered for study and

analysis by the researcher. Also due to confidentiality, employee of the company did not give an

acknowledgement letter to researcher.

The respondent company did not disclose certain facts and figures related to premium, claims and

customers again due to confidentiality.

The researcher wanted to study ahead about the topic in detail but due to limitations which were

put by the University, the researcher restricted to project affairs only.

In spite of such limitations, research could get enough information required to conduct an analysis

of the topic.

1.11 SUMMARY

The insurance industry is a key component of the financial infrastructure of an economy, and its viability

and strengths have far reaching consequences for not only its money and capital markets, but also for its

real sector. The Indian insurance industry has traveled a long way ever since businesses were regulated

tightly & concentrated by few insurers of the public sector.

The activities of insurance companies have become more diversified in response to high expectations

from their customers. With liberalization & globalization of economy, they are required to offer more

different products & services at competitive prices.

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Chapter:-2

Review of Literature

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REVIEW OF LITERATURE

Review: 1

Project on the New India Assurance Company.Author

Sandeep vaishnav

Introduction

Assurance industry has always been a growth-oriented industry globally. On the Indian scene too, the

assurance industry has always recorded noticeable growth vis-à-vis other Indian industries. The new India

assurance Co. Ltd. was the first general assurance company to be established in India in 1850, which was

a wholly British-owned company. The new India assurance company to be set up by an Indian was Indian

Mercantile assurance Co. Ltd., which was established in 1907. There emerged many a assurance player

on the Indian scene thereafter. The general assurance business was nationalized after the promulgation

of General Insurance Business (Nationalization) Act, 1972. The post-nationalization general assurance

business was undertaken by the assurance Corporation of India (GIC) and its 3 subsidiaries:

Objectives:

Ascertain the profile and characteristics of potential buyers.

To have an insight into the attitudes and behaviours of customers.

To find out the differences among perceived service and expected service.

To produce an executive service report to upgrade service characteristics of life insurance companies.

To access the degree of satisfaction of the consumers with their current brand of Insurance products

Finding:

Professional Management:You avail of the services of experienced and skilled professionals who are backed by a dedicated investment researchs team which analyses the performance and prospects of companies and selects suitable investments to achieve the objectives of the scheme.Diversification:

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Funds invest in a number of companies across a broad cross-section of industries and sectors. This diversification reduces the risk because seldom doll 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 ownReview: 2Shopkeeper insurance in India with reference to the new India assurance co. ltd

Author

Mahesh jaiswar

Introduction

People constantly face a number of risks but are unaware of the dangers they are in until

something major happens to them. These include risk to ones health - illness, accident or risk to ones

property - fire, burglary, earthquake etc. Insurance covers all such risks over which one has no

control and that too at a very low cost.  As responsible members of a family, one should be adequately

prepared to manage these risks.

Similarly a shop owner will take great pride in his establishment as it has been built up to its present glory

due to a lot of hard work and sacrifice on his part and hence he may have worries about the dangers his

shop and its contents are exposed to. Theft, an employee’s infidelity, a fire accident – such unfortunate

events can most certainly hamper the smooth running of the sales premises. That is why a protective

cover like a comprehensive policy cover to protect the shop building, its contents and the peace of mind

of its owners is required. Hence, shop insurance is required to cover the losses that arise due to a wide

variety of perils.

Objective:

To outline the benefits and limitations of taking out the policy to the customers of various

categories,

To ascertain the need and reasons of the customers for including those risks that are not included in

the current policy.

Finding:

One such innovative service introduced by the companies is shop insurance policy. This policy is

especially for the small shop-keepers. It is necessary to create awareness among the people about this

policy and also make them understand the benefits of taking out such a policy. This project gives a bird’s

eye view on shop insurance policy in India.

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Review 3

General insurance market in India

Author

Jan 12, 2010 by CHAITRA NAIK

Introduction

This project is about the study conducted on the general insurance industry. In particular with the auto insurance this is a part of general insurance. This is the detailed study on how auto insurance industry sector functions, what are the challenges faced by auto insurance industry currently, Who are the market players in this auto insurance sector? What is the current market situation about of the auto insurance sector What are the various market strategies followed by these industries What are the challenges faced by auto insurance sector How the companies are taking steps in order can overcome the challenges. What are the future prospects of auto insurance industry.

Objective

“To study the Indian general insurance industry particularly with the autoinsurance segment of general insurance, identify areas of excellence andareas needing improvement; and provide suggestions for such improvement”.

The aim of this Thesis is to successfully study general insurance sector one common platform, analyze their working and performance; marketingstrategies highlight their performance, evaluating the various challenges faced by them while providing suggestions and recommendations for improvement.

Finding

Big changes have occurred over the last few years, during which the sector was opened to private participation, along with foreign direct investment.

It also has one of the lowest penetration rates for property and casualty insurance in Asia in terms of premium as a percentage of GDP.

India’s general insurance market witnessed a variety of changes as deregulation continued at a hectic pace.

Rate reductions in the recently de-tariff corporate portfolio (fire &engineering) has impacted the

premium growth, but this is also leading to the greater sales of existing and new products

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CHAPTER:-3

Research Methodology

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RESEARCH METHODOLOGY

3.1 RESEARCH METHODOLOGY

The research decides to do survey in DOMBIVLI AREA. The researcher use survey method for presents

3.2 SOURCES OF DATA

Primary data and secondary data were collected for present study:

a) Primary Data:-The researcher collected the primary data personally through face to face interaction

with the shop owner.

b) Secondary Data:-The secondary data was collected through various ways which is by Internet,

Journals and Textbooks.

3.3RESEARCH AREA

The researcher has made research in Mumbai region. To study the shopkeeper’s insurance policy in

Mumbai, with respect to the new India assurance company limited.

3.4 METHOD USE FOR DECIDING THE SAMPLING PLAN

The researcher used selective sampling method to collect data.

3.5 SAMPLING PLAN

The sample size constituted of 30 respondents.

3.6 VALIDATION OF TOOLS

The question in questionnaire was discussed with bank officials and senior professors in the college to

ascertain their accuracy. The questionnaire was then finalized after discussion with experts.

3.7 DATA COLLECTION INSTRUMENT

The type of instrument used for data collection for surveying was Questionnaire

3.8 RATING SCALE11 | P a g e

Lakers scale was used in the questionnaire.

3.9 DATA PROCESSING AND ANALYSIS PLAN

The data was processed and analyzed with the help of percentages using excel sheet.

3.10 FIELD WORK

The approach was made to the respondent for three times. The sample constituted bank manager and staff

selected through random method.

At first visit the shop owner of respondent, to study the performance of shopkeeper’s insurance policy .

Approach the fill form to the customer who is taking home loan. Statistical tools were used to analysis the

data collected.

The data collected was tabulated and graphical.

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CHAPTER:-4

Data Analysis

And

Observation

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Q.1 Since, how many years you have been taking this shopkeeper’s insurance policy?

Particular Responded In Percentage0 To 1 Years 6 202 To 3 Years 9 30 3 To 5 Year 8 27 More Than Years 7 23

Observation:

20% respondents have been taking shopkeeper insurance policy for 0 to 1 years.

30% respondents have been taking shopkeeper insurance policy for 2 to 3 years.

27% respondents have been taking shopkeeper insurance policy for 3 to 5 years.

23%respondents have been taking shopkeeper insurance policy for more than 5 years.

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Q:2How did you come to know about this insurance company?

Particular Responded In PercentageInsurance Company 3 10Relative & Friends 7 23Advertisement 5 17Internet 6 20Agent 9 30

Observation:

10% respondents that know about this insurance company through insurance company.

23%respondents have known about this insurance company through relative & friends.

17%respondents that know about this insurance company through advertisement.

20% respondents that know about this insurance company through internet.

30% respondents that know about this insurance company through agent.

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Q.3 what documents were submitted by you for shopkeeper’s insurance?

Particular Responded In PercentagePan Card 17 57Aadharcard 13 43

Observation:

57% respondents have pan card submitted for shopkeeper insurance policy.

43% respondents have aadharcard submitted for shopkeeper insurance policy.

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Q.4 Does your insurance company helps you regarding positive and negative side of the policy?

Particular Responded In PercentageYes 9 43No 21 57

Observation:

30% are respondents that insurance company helps you regarding positive and negative side of the policy.

70% are not respondents that insurance company helps you regarding positive and negative side of the policy.

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Q.5Did you receive the policy on time?

Particular Responded In PercentageYes 19 63No 11 37

Observation:

36% respondents have receive the policy on time.

37% respondent has not receive the policy on time.

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Q.6 Does your queries solved by insurance company personnel?

Particular Responded In PercentageYes 25No 5

Observation:

83% respondents have been queries solved by insurance company personnel.

17% respondents have not queries solved by insurance company personnel.

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Q.7 Are you satisfied with facilities provide by insurance company?

Particular Responded In PercentageYes 27 90No 3 10

Observation:

90% respondents has been satisfied with facilities provide by insurance company.

10% respondent that is not satisfied with facilities provide by insurance company.

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Q.8 How do you pay the insurance premium?

Particular Responded In PercentageOnline 0 0Cash 26 87Postdated Cheque 4 13

Observation:

0% respondents are pays the online insurance premium.

87% respondents are paying the cash insurance premium.

13% respondent is paying the postdated cheque.

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Q.9Could you afford yearly payment of premium?

Particular Responded In PercentageYes 23 77No 7 23

Observation:

77 respondents are afford yearly payment of premium.

23% respondents are not afford yearly payment of premium.

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Q.10 Do you have any suggestion for improvement regarding the shopkeeper’s insurance policy with formalities?

Particular Responded In PercentageTime Taken To Received The Claim

16 55

Calculation Of Claim Amount

7 24

Premium Option6

21

Observation:

55% respondents have improvement regarding the shopkeeper’s insurance policy with formalities for Time taken to receive the claim.

14% respondents have improvement regarding the shopkeeper’s insurance policy with formalities for Calculation of claim amount.

21% respondents have improvement regarding the shopkeeper’s insurance policy with formalities for Premium option.

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Q.11 Do you have any complaints against shopkeeper’s insurance term and condition?

Particular Responded In PercentageYes 8 25No 24 75

Observation:

25% respondents have complaints against shopkeeper’s insurance term and condition.

75% respondents are not complaints against shopkeeper’s insurance term and condition.

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Q.12 Are you satisfied with terms and conditions about shopkeeper’s insurance?

Particular Responded In PercentageYes 16 58No 14 47

Observation:

58 % respondents have been satisfied with terms and conditions about shopkeeper’s insurance.

47% are respondents are not satisfied with terms and conditions about shopkeeper’s insurance.

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Q.13 Can you make delayed payment of premium?

Particular Responded In PercentageYes 0 0No 30 100

Observation:

0% respondents are make delayed payment of premium.

100% respondents are make delayed payment of premium.

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Q.14 How do you rate the service provided to you by the insurance company?

Particular Responded In PercentageExcellent 2 7Very Good 6 20Good 16 53Poor 6 20

Observation:

7% respondent’s service provided to you by the insurance company for the excellent.

20% respondents’ service provided to you by the insurance company for the very good.

53% respondents’ service provided to you by the insurance company for the good.

20% respondents’ service provided to you by the insurance company for the poor.

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Chapter:-5

Finding & Interpretation

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Chapter:-5 Finding

Table No 1

It is found that majority of the respondents have been taking this shopkeeper’s insurance policyand some people are 0 to 1 years,3 to 5 years and more than 5 years.

Table No 2

Most of the people are respondents that the know about this insurance company for the agent some people are relative & friens, advertisement, Insurance company and internet.

Table No 3

It is found the majority of the respondents are submitted by you for shopkeeper’s insurance for the pan card and some people are aadharcard.

Table No 4

It is show that majority of the respondents’ insurance company helps you regarding positive and negative side of the policy and some people are not insurance company helps you regarding positive and negative side of the policy.

Table No 5

It is found that majority of the respondent receive the policy on time than some people are not receive the policy on time.

Table No 6

Most of the people are respondent queries solved by insurance company personnel than people are not queries solved by insurance company personnel.

Table No 7

It is found that majority of the respondents satisfied with facilities provide by insurance company and some people are not satisfied with facilities provide by insurance company.

Table No 8

It is show that majority of the respondents pay the insurance premium for the cash and some people are pay the insurance premium for the postdated cheque.

Table No 9

It is found that majority of the respondent afford yearly payment of premium and then some people are not afford yearly payment of premium.

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Table No 10

It is found that majority of the respondents’ improvement regarding the shopkeeper’s insurance policy with formalities for the Time taken to receive the claim. And some people are improvement regarding the shopkeeper’s insurance policy with formalities for the Premium option.

Table No 11

Most of the people are respondents that are complaints against shopkeeper’s insurance term and condition

Table No 12

It is show that majority of the respondent are satisfied with terms and conditions about shopkeeper’s insurance and some people are not satisfied with terms and conditions about shopkeeper’s insurance.

Table No 13

It is found that majority of the respondents are not make delayed payment of premium.

Table No 14

It is found that majority of the respondent that is service provided by the insurance company for the good. Some people are service provided by the insurance company for the poor, very good and excellent.

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Chapter:-6

Conclusion and recommendation

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Chapter:-6Conclusion and recommendation

Conclusion

Insurance may be described as a social device to reduce or eliminate risk of loss to life and

property. The risks, which can be insured against, include fire, the perils of sea, death and accidents and

burglary. Any risk contingent upon these may be insured against, at a premium proportionate to the risk

involved. Thus collective bearing of risk is insurance.

The Indian insurance industry has traveled a long way ever since businesses were regulated tightly &

concentrated by a few insurers of the public sector. The launch of new developments in the insurance

industry saw many new international insurers entering the market. It also gave way to propagation of

innovative goods & channels for distribution & hence the supervisory norms rising. Shopkeepers’

insurance policy is one such innovative product offered to customers.

Shops today have become the most common means of livelihood for an individual. These are easy to set

up and easy to run. However, these are not bereft of risks. Setting up a shop involves a large sum of

money and any damages to it could incur a huge loss on the owner. The owner hardly has the time to

think about this due to the work he has to put in therefore this policy takes that trouble from him. Hence,

there is a need for shopkeepers’ insurance policy. But, the shop-owners have failed to understand its

importance which may be due to many reasons.

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Recommendation

Based on the study the researcher carried out, there are some main causes for the unpopularity of

shop insurance package in India. They are:

a) Lack of awareness

b) Ignorance

c) Time consuming procedure

d) Paper-work

e) Premium

To overcome these problems, the researcher has made the following recommendations which the

Insurance companies need to apply:

A) To increase public awareness through extensive marketing efforts in the form of advertisements

distribution of pamphlets, etc;

B) To increase the human resources involved in marketing and selling of policies and train them properly;

C) To incorporate new technologies to make the various procedures simpler and faster.

D) Proper mechanisms for handling suspicious claim reports;

E) To reduce the premium rates in accordance with the risks taken;

F) To include more risks in the policy and also to cover some of those risks that are currently in the

exclusions.

These are just some suggestions which may or may not be implemented by the insurers. By implementing

at least some of the recommendations above, there can be a vast growth and profitability rate. This growth

rate will improve the economy and thus boost India’s growth which will allow creating space for the

nation internationally in this category.

Bibliography

PRIMARY DATA

Personal interview with an employee of New India Assurance Company Ltd., data from the personal

website of the company which are for the employees only as well as survey of the shop-keepers regarding

the shop insurance policy.

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SECONDARY DATA

1. Books

a) ‘Insurance- Fundamentals, environment and procedures’ by B.S. Bodla, M.C. Garg and K.P. Singh

b) ‘Practical approach to General Insurance Underwriting’ by K.C. Mishra and R.C. Guria

c) ‘Indian Insurance- A Profile’ by H. Narayanan

d) ‘General Insurance (Commercial)’ of ICFAI University (Publication-18th August, 2006)

2. Websites

http://www.iloveindia.com/real-estate/commercial-insurance. insurance.html

http://www.iribl.com/policy_ind.htm

http://www.ayushveda.com/realestate/shopkeepers-insurance-policy.htm

http://www.economywatch.com/insurance/building/shop.html

http://www.idealinsurance.in/genins1.php?pid2=70

Appendix

MATRUSHRI KASHIBEN MOTILAL PATEL SENIOR COLLEGE OF SCIRNCE &COMMERCE

MUKESH N GAUTAM

CLASS-TYBBI

Roll No-02

To study the shopkeeper’s insurance policy performance in Mumbai, with respect to the new India assurance company limited.

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Questionnaire

Name of the owner: _____________________________________________________________

Location of the shop: ____________________________________________________________

Telephone No: ________________________________________________________________

Q.1 Since, how many years you have been taking this shopkeeper’s insurance policy?

0 to 1 years 2 to 3 years

3 to 5 year more than years

Q.2How did you come to know about this insurance company?

Insurance company Relative & friend

Advertisement Internet Agent

Q.3 what documents were submitted by you for shopkeeper’s insurance?

Pan card adhaarcard

Q.4 Dose your insurance company helps you regarding positive and negative side of the policy?

Yes No

Q.5Did you receive the policy on time?

Yes No

Q.6 does your queries solved by insurance company personnel?

Yes No

Q.7 Are you satisfied with facilities provide by insurance company?

Yes No

Q.8 how do you pay the insurance premium?

Online Cash postdated cheque

Q.9 Could you afford yearly payment of premium?

Yes No

Q.10 Do you have any suggestion for improvement regarding the shopkeeper’s insurance policy with formalities?

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Time taken to received the claim Calculation of claim amount Premium option

Q.11 Do you have any complaints against shopkeeper’s insurance term and condition?

Yes No

Q.12 Are you satisfied with terms and conditions about shopkeeper’s insurance?

Yes No

Q.13 Can you make delayed payment of premium?

Yes No

Q.14 How do you rate the service provided to you by the insurance company?

Excellent very good

Good poor

Q.15 Does shopkeeper insurance provide any offers?

____________________________________________________________________________________________________________________________________________________________

Q.16 Are all scheme suitable to you provide by insurance company?

_____________________________________________________________________________________________________________________________________________________________________

Q.17Any suggestion?

_____________________________________________________________________________________

Glossary

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