INTERNATIONAL JOURNAL OF MARKETING,

FINANCIAL SERVICES & MANAGEMENT RESEARCH

Online Available at indianresearchjournals.com

Vol.1 No. 2, February 2012, ISSN 2277 3622

A STUDY OF BRAND LOYALTY WITH SPECIAL

REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA
DR.D.T.CHAVARE
C.D.Jain College of Commerce, Shrirampur.

ABSTRACT
The abstract is the form of the concluding statement that provides the quick review of the paper.
This abstract is helpful to make aware the readers about the subject under study. In this paper researcher has
attempted to provide detailed information regarding Brand Loyalty with respect to Life Insurance
Corporation of India. The paper titled "A STUDY OF BRAND LOYALTY", With reference to, "LIFE
INSURANCE CORPORATION OF INDIA". At present, investment of saving has assumed great
importance. According to the study of the market, it is being observed that markets are being doing well in
Insurance. In near Future a proper financial planning is required to invest money in all type of financial
project because there is good potential in market to invest In this paper great emphasis is given in
understanding the perception of investors towards the brand. The main objective of this project is to know
various determinants of brand loyalty. The researcher has drawn certain conclusions, which are based on
the analyzed data. In addition researcher has made an attempt to suggest some remedies to improve gray
areas of the services of organization. After analyzing the feedback the conclusion has been made that the
respondent are very loyal towards brand LIC.
Key words: Brand Loyalty, Customer relationship management, Life Insurance Corporation of India,

INTRODUCTION

particular product, Instrument and on Brand of that

In modern era there is cut throat competition in the

product.

market.

Many times any organization not success

A brand is the key aspect of purchasing the

because of its good product or with huge capital, but it

product or invests the money. Brands are important to

is possible with the help of backbone of good brand.

consumer as they provide them with choice, a means of

Brand is an important term from the point view of

simplifying the decisions, Quality assurance, Risk

market. Brand is the identity of the product. Corporate

avoidance and self-experience.

are more & more working or spending more on the

brand and corporate identity.

While making the decision of investment, people

think on different parameters. A brand & Brand

While investing the money investors think over

Loyalty is also one of the important parameter, key

the key aspects of any investments that are time & risk.

element of decision making of investment. The

Investors have wide range of investment avenues

element Brand Loyalty affects more on decision of the

available to them. They may be classified into the

investor. In Insurance business this brand Loyalty is

various categories i.e. Non-Marketable Financial

found in regards to Life Insurance Corporation of

Assets, Shares, Mutual Funds Scheme, Life insurance

India. People are more loyal towards this Company.

policies etc. The decision of investor or the particular

The concept brand Loyalty has a wide scope to

customer is not only depending upon the risk, return,

study & understand from the point view of research. It

and on convenience, but also depends upon that

is difficult too corporate or any organization to stand in

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DR.D.T.CHAVARE

the market without the brand & Loyalty. Some well-

1.2 OBJECTIVES OF THE STUDY: -

situated organizations are trying to get benefit or their

1.

To study the concept of Brand Loyalty.

reputed brand & it's Loyalty. Brand Loyalty is a

2.

To study the Brand Loyalty of LIC.

conscious or unconscious decision expressed through

3.

To find out determinants of Brand Loyalty.

intention or behavior to repurchase a brand

continually. Loyalty reflects the consumer attitude,

1.3 SCOPE OF THE STUDY

faith, and behavior, toward the brand. By purchasing

This study includes the concept Brand Loyalty, the

the particular brand regularly customer show's Brand

organization LIC of India. The study is conducted in

Loyalty.

Satara to analyze the investor's preference regarding

The industry is trying to retain their customer by

Loyalty of Brand in Life Insurance sector. To analyze

various ways. The CRM (Customer relationship

the data researcher used simple analytical techniques

management) is taking places in the market, but

and tools such as pie charts, and ranking.

industry and market has another way of retaining and

increasing customer that is a Brand Loyalty. Mental

1.4 LIMITATIONS OF THE STUDY: -

attachment of customer with brand is helpful to

1.

increase business. It is expensive to gain new customer

determinations of Brand Loyalty, i.e. Changes

& relatively in expensive to keep the existing one,

especially if they are satisfied and more so, if they like

sample to sample.
2.

the brand. Companies don't want to miss any of the

about the New Company.

3.

India, stands for last 50 years. The LIC created best

service brand in India last three years regularly. It is

The investors knowledge about Life insurance

Company's is so less, or may be they are not aware

loyal customers.
In insurance sector Life Insurance Corporation of

It is difficult to researcher to find out the

There is a possibility of personal bias while

answering the questionnaire.

4.

Illiteracy of the respondents may affect the study.

interesting to study the Brand Loyalty of LIC in the

growing insurance sector. 1.1 RESEARCH DESIGN-

1.5 IMPORTANCE OF THE STUDY

The following Research design is adopted for this

The research is conducted to study the concept 'Brand

paper :

Loyalty' with respect to LIC of India. The study is of

1.1.1 Management Problem: -

significance to the organization and to the investors of

Management wishes to know & want to study the

Life Insurance Policies.

concept of Brand Loyalty, and also want to know the

1.5.1 Importance to the Life Insurance

determinants of Brand Loyalty, in insurance business

Corporation of India

with reference to the LIC of India.

1.

1.1.2 Statement of Research Problem:The title of the paper is "A study of Brand Loyalty

The study will helpful to the organization to

understand the 'Brand Loyalty' of LIC in Satara .

2.

The study will be of help to organization to

with special reference to the LIC of India." This

identify the grey areas in insurance service and to

signifies study of Brand Loyalty on the basis of choice

take steps to improve it.

of the investors to the brand..

1.5.2

Significance to the Investors

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A STUDY OF BRAND LOYALTY WITH SPECIAL REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA

1.

2.

The customer of Life Insurance would get the

benefit of this Research while making the next

researcher has used Non-Probability Convenient

decision of their investment in Life Insurance.

Sampling method, all samples are from Satara District

The general investors would get the benefit of this

only. The size of sample is 200.

research, by considering different determinants of

1.6.5

Brand Loyalty in decision making.

3.

Universe of this research is infinite in nature, so

The people or investor's can get knowledge of

market position of other companies.

Sources is analyzed. The analyzed data is formulated in

to the tabular and graphical form.
1.6.6

1.6 RESEARCH DESIGN:-

Data Analysis:-

Data collected from Primary and Secondary

Research Tools used for Analysis:-

In order to derive meaningful result, researcher

Research Design of the study deals with understanding

has used the pie charts and ranks. Data analysis is done

the Brand Loyalty of Insurance Company with special

for finding Investors Brand choice & preferences.

reference to Life Insurance Corporation of India. It is

adopted for this study as follows:1.6.1

Data required for the study:-

To carry out the research, the various data is

required such as conceptual knowledge about Brand

2. BRAND LOYALTY: An overview

Brand Loyalty concept is related with the faith of
brand. The customers trust on brand it results in to the
brand Loyalty.

Product without brand name

Loyalty, Policy holder's information about their

cannot meet the customer requirements in the name of

preferences, choices, investment awareness in Life

the brands; companies want to charge more or try to

Insurance, with respect to different Company.

exploit the customer. Brand matters more either for

1.6.2

Data Sources: -

A. Primary Source: To study the Brand Loyalty of LIC of India data

company or for customer. If customers are indifferent

to the brand and buy with respect to features, price,
and convenience with little concern to the brand name,

collected through Primary Source. i.e. Interviews,

there is likely little equity. The brand Loyalty of the

discussions & Questionnaires.

customer base is often the core of brad equity.

B. Secondary Source: -

In any business, gaining new customer is quite

The Secondary data have been collected through

difficult and expensive, and requires lot of marketing

the books, magazines, broachers, Journal's & annual

effort with uncertainty. But retain the customer and

general report, socioeconomic profile and web sites.

maintain customer base is relatively easy and

also used. 1.6.3 Instruments:-

inexpensive, that's why organizations are trying to

To collect the primary data questionnaire is

achieve the last step of Branding i.e. maintaining brand

prepared. This questionnaire consists close-ended

Loyalty. Loyalty is one of the important brand assets.

questions. The questionnaire is a siphon off

For increasing the asset or maintaining the asset,

information viz. individual profile, company

organizations are trying different way like CRM &

preferences, choices, determinants etc. The

BRM. Loyalty reflects the consumer's attitude towards

questionnaire is then executed on samples.

the brand, especially when there is a change either in

1.6.4

price of product features.

Sampling:-

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DR.D.T.CHAVARE

Brand Loyalty has different levels; each level

India and for setting up of the Life Insurance

provides different equity to the brand. There are five

Corporation of India. The bill as passed is known as the

different Levels of Brand Loyalty from the bottom to

Life Insurance Corporation Act.

top. The Loyalty adds sum type of value to the market.

The corporate started functioning from

The strategic value of Brand is in the form of reducing

September 1, 1956, with the effect from this date the

Marketing Costs, Trade Leverage, Attracting new

corporation became the sole agency for carrying on life

customer, Timely response to competitive threats. The

insurance business in the country. The corporation has

Loyalty of Brand helps the organization to increase its

got monopoly to carry on Life Insurance business. The

business.

LIC transacts business throughout India and also in

some foreign countries through its branches,

2.1 THE NATURE OF BRAND LOYALTY: A study of repeat purchase behavior for nine

particularly in U.K. Mauritius, Srilanka, Fiji &

Bahrain.
Life Insurance Corporation of India is a body

products based on a Chicago Tribune purchase panel

suggested that there were four brand loyalty patterns as

corporate having a perpetual succession and common

follows.

seal with power to acquire, had and dispose of property

1.

and may by its name sue or be sued. The corporation

2.

3.

Undivided loyalty is exhibited by families

purchasing brand A in the following sequence A

consists of such number of persons not exceeding is as

A A A A A.

the central government thinks fit to appoint there to

Divided loyalty is exhibited by the family

and one of them is appointed by the central govt. to be

purchasing brands A and B in the following

the chairmen there of the head office of the LIC is at

sequence A B A B A.

Mumbai. It has seven zonal offices, 100 divisional

Unstable loyalty is shown by the family buying

offices and more than 2000 branch offices spread over

brands A and B in the following sequence. A A A

the India.
Thus Life Insurance Corporation was born

A B B B.
4.

3.

No loyalty is shown by families buying brands A,

committed to the socio-economic welfare of the

B, C, D, E, and F in the following sequence. A B

people with its three basic objectives:

C D E F.

1.

Harnessing the saving.

2.

Providing security.

3.

Utilizing people's money for people welfare.

INTRODUCTION

TO

THE

ORGANIZATION
The life insurance business developed in India after

3.2. PRODUCT DETAILS: -

independence. Before 1950 there were 245 companies

LIC is dealings with financial products, i.e.

in private sector doing Life Insurance business. From

insurance, more than 50 years. The organizations

January 19, 1956, the Life Insurance business comes

always stand from customer's side for more return

under the control and ownership of central

safety & risk. From the starting LIC include summary

government. In June 1956, the parliament passed the

Life insurance policies of & investment plan for child,

bill for nationalization of the life Insurance business in

youngsters, couple, and old use people. A Few

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A STUDY OF BRAND LOYALTY WITH SPECIAL REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA

specified, popular products of LIC are as follows:

4.

DATA ANALYSIS

A.

Whole Life Policy.

To know the brand loyalty researcher has conducted a

B.

Endowment Policy.

survey of LIC employees. Preferences and choices

C.

Group Insurance scheme.

considered by customer are taken in to account. The

D.

Pension Plans.

experience of the LIC employee has considered for

E.

Unit linked plan.

preferences and choices and the benefit of LIC Brand

F.

Special Plan.

that LIC enjoying. Table No. 4.1 - Benefits of Well

G.

Money back Plan.

positioned Brand according to LIC employees

(Source: Primary data)

The above table reveals the Benefits of well-

competitive threats, Brand induce the customer in

positioned brand according to LIC employee.

terms of quality perception and Brand may give

'Existing loyal customer help marketers to get more

marketer greater control over marketing strategy'. The

business through prospecting customer has a first rank

Brand induce the consumer in terms of price

in the analysis. Another benefit to attract new

perception this benefit has an last rank in the table.

customers has a 2ndrank. 3rd rank commonly acquired

by the benefit, 'Reduce marketing cost, Buyers buy

Table No. 4.2. - Experience of LIC Employees

only brand name, People pay higher price for well

regarding

known brand'. Like wise fourth rank also commonly

Selecting Company

preferences

of

client

for

acquired by benefit, 'time to respond to the

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DR.D.T.CHAVARE

(Source: Primary data)

According to this table, safety has considered on

consistency in service, service standards and product

the first rank by the client in the eye-view of LIC

flexibility are some what important because these are

employees. The parameters of trust, value for money

on 5,6,7,8, rank respectively.

and companies track record, following the ranking as

4.1. Data Analysis of policyholder's response

second, third and fourth. As per the table, parameters

like professional money management, usage of
technology & the management team has not much
considered by client, it has least importance to the
inverters. But parameters like peace of mind,

The samples collected from the Satara city are

analyzed by using statistical tool .The weighted
average calculated for giving rank to the parameter .
Table No. 4.3 Classification of respondent
according to Education Qualification
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A STUDY OF BRAND LOYALTY WITH SPECIAL REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA

(Source: Primary data)

GraphNo.4.1 Classification of respondent according to Education Qualification

The preceding table reveals the education

samples from Graduate / PG professional category.

qualification of the investor. In the research 1%

samples are illiterate. The majority samples from the

Table No. 4.4 Classification of respondent

Graduate / PG general category that is 40% and 30%

according to their Occupations

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DR.D.T.CHAVARE

(Source: Primary data)

Graph No.4.2 Classification of respondent according to their Occupations

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A STUDY OF BRAND LOYALTY WITH SPECIAL REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA

As per above table, majority samples are self

worker petty traders and Industrialist.

employed professional i.e. 22% samples. After that

18% respondents are officer / executive. There is less

Table No.

number of sample from the category of unskilled

according to income group

4.5 Classification of respondent

(Source: Primary data)

Graph No.4.3 Monthly Income Frequency

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DR.D.T.CHAVARE

Graph No.4.4 House holds Income Frequency

From the table No. 4.5 and Graph No. 4.3 it is

of house hold income, Graph No.4.4 depicts that 23%

found that, majority samples from the Income class of

respondent are in the income group of 10001-15000,

Rs.5001- 10000 and 10,001- 15,000 i.e. middle &

19% in the group of 15001-20000 and 16% in the

higher middle income group has an 50% hold in

group of 5001-10000.

sampling. The income classes started from 30000 to

40000 have a few numbers of respondents. In respect

Table No. 4.6. Investment Pattern of Respondents.

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A STUDY OF BRAND LOYALTY WITH SPECIAL REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA

(Source: Primary data)

Table No.4.6 indicates the typical mind set up of Indian

systematic investment plan are hardly preferred by the

traditional Investors. They preferably invest in Bank

respondent. The investment avenue like ELSS, NBFC

Deposit, Insurance & Gold as they get ranking 1, 2 and

scheme, Debt insurance not aware by investors.

3 PPF, PO scheme and real estate are another

Table No. 4.7 Table showing preferences of

instrument preferred by policyholder on No. 4, 5 and

investor for Future investment in Insurance

6. Instrument like shares, company deposit's,

Company.

(Source: Primary data)

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DR.D.T.CHAVARE

The above table reveals the preference of investors

placed on rank 5th, 6th and 7th respectively.

for his investment in future, in insurance company. The

Companies like Sahara, METLIFF, New York, Bharti

LIC get first rank for future investment. ICICI, Bajaj

are not preferred by respondent that's why these

and Tata have got 2nd, 3rd, and 4th ranks respectively.

companies stood at last in the ranking.

Also respondent given good ranking to the companies

Table No.

like HDFC, Reliance & Birla Sunlife, these companies

while selecting insurance company

4.8 Benefit Considered by Investor

(Source: Primary data)

Table No.4.8 depicts that 'safety' benefit is

The traditional mind setup of investors has not

primarily considered by respondent to select insurance

considered the benefit of 'Professional Money

company. 'Value for Money' is second important

Management' and 'High Quality Service Standard'

benefit according to investors. It has got second rank.

that's why it has a last rank.

The 'Service Performance' of insurance company and

'peace of mind' after investment has got third and

Table No. 4.9 Parameters Consider by investors

fourth rank respectively.

while selecting insurance company:

(Source: Primary data)

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A STUDY OF BRAND LOYALTY WITH SPECIAL REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA

Respondent consider various parameters for

selecting insurance company.

are on rank 3rd, 4th and 5th respectively. Technology

First and important

factor and management team factor has not much

parameter of decision marking is the 'Trust' on the

important parameters for investors; these parameters

company. Company's track record is second parameter

place at last in ranking.

for selection of insurance company. Investors also

consider product flexibility and transparency, financial

Table No. 4.10 Additional parameters consider by

strength of promoters and parentage parameters; these

investors while selecting insurance company.

(Source: Primary data)

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DR.D.T.CHAVARE

Graph No.4.5 Additional Parameter for selecting

insurance company according to policyholder

on.5th and 6th respectively.

Additional parameters like effective advertising,

There are some other parameters that investor

regular communication from company, and claim

consider for selecting insurance company. The right

settlement experience are not that much influence the

product features and right price of the product are

investors, these parameters have ranked lower. At the

mostly preferred additional parameters they have 1st

end product range of company has taken place on 17 in

and 2nd rank respectively. Perceived image of company

ranking as a parameter for selecting company.

and perceived level of quality of product this factors

place at rank No. 3rd & 4th respectively. The faith on

Table No. 4.11 most preferred insurance company

sales person and reference from well wishers are ranked

in India by investors.

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A STUDY OF BRAND LOYALTY WITH SPECIAL REFERENCE TO LIFE INSURANCE CORPORATION OF INDIA

(Source: Primary data)

The above table predicts that LIC has a first rank

as most preferred insurance company in India by
investors. ICICI, Bajaj has an 2nd & 3rd rank. Also
there is competition from Tata & HDFC these are
placed at no.4th &5th ranks respectively. In short
period Reliance placed good ranking in the table it has
at no.6, Birlasunlife and SBI are also have a good share
and placed at No. 7th and 8th rank. O t h e r
Companies that are ING VAYSA, AVIVA,
MAHINDRA, BHARATI, SHRI-RAM, SAHARA,
MET-LIFE, and New York are last in the ranking at
No. 9, 10, 11, 12, 13, 14, and 15 respectively. These
companies are not popular in Satara city.
5. FINDINGS
5.1. General findings: 1. Insurance is an inevitable part of human being
today.
2. People are much more aware about insurance.
3. Brand LIC have a monopoly in the market.
4. LIC is most trusted company in the market.
5. Many investors don't know the other Company
except LIC.
6. Investors hardly know about the foreign brand of
insurance companies.
7. While investing money people generally think
benefit of safety & value for money.
8. Trust, image, goodwill, track record is considered
most by investor.
9. If Investor's get aware & convinced by the adviser

then a then only investors will purchase a policy.

10. There is less impact of advertising on investors
that he can't recall the advertisement.
5.2. Specific findings:1. Loyal customer of LIC helps LIC to get more
business. Brand name of LIC attracts new
customers, and reduces marketing cost to LIC.
LIC have a strong loyalty Base, this is competitive
threat to other companies. Brand LIC does not
induce the consumer in terms of price perception.
2. Safety & Trust are the important parameters that
investors consider while selecting insurance
company, value for their money and company's
track record is also important parameters for
selecting insurance company according to LIC
employee for investors. Investors never think
much about management team and technology
the company uses.
3. Investors invest more in bank deposits, insurance
& gold, because these are more safety than other.
Investment instrument like Art objects, NBFC
scheme, precious stone, Debt instrument are not
popular in the investors.
4. LIC is the most preferred insurance company in
India, but LIC facing competition from other
companies like ICICI, Bajaj, Tata, HDFC, and
Reliance.
5. While selecting insurance company, safety and
value for many benefits are mostly considered by
investors. Trust as well as company track record
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DR.D.T.CHAVARE

are important parameters according to investors

for selecting insurance company
6. Features of the product, price of the product and
perceived image of company are important
additional parameters that respondent consider
for decision making firstly and secondly.
7. Many investors mostly consider the reference
from well-wishers and their experience as a
guideline for selecting insurance company.

5.

6.

7.
6. SUGGESTIONS
After careful study of "A study of Brand Loyalty" with
reference to Life Insurance Corporation of India, the
researcher has to make the following suggestions. LIC
is a well-established brand in the market because of its
long market standing and loyalty. After observation of
the other company's presence in the market, LIC
should think on following points.
6.1 General Suggestions: 1. LIC should try to take more and more benefit
from their loyal customers. 2. LIC should make
aware people more and more about Insurance.
3. There should be separate customer relationship
program in the organization like CRM.
4. LIC should concentrate on below poverty line
people and farmer living in rural area.
5. LIC should try to increase their bonus rates
compared to other private companies.
6.2 Specific Suggestions: 1. LIC should concentrate more on customer care
and after sale services (From table No. 4.2)
2. LIC should highlight skill of their people as well
as usage of technology, which will attract
investors. (From table No. 4.2)
3. LIC should try to aware investor's about benefit's
of their, professional money management and
high quality service standard, to increase the
sale.(From table No. 4.8)
4. Companies track record' and 'Trust' are major
parameters that are considered by investor while

8.

selecting insurance company, therefore LIC

should maintain 'Trust' and improve effective
track record. (From table No. 4.9)
LIC should minimize the gap between investor
and company and build healthy relation and
regular communication. (From table No. 4.10)
LIC should concentrate on direct marketing
rather than huge advertising (From table
No.4.10)
There should be easy procedure and less
documentation in respect of purchasing new
policy. (From table No. 4.10)
LIC should adopt aggressive marketing strategy
like wise other private companies (ICICI, Tata,
Reliance and Bajaj). Also it should increase the
sales force to compete with aggressive private
player. (From table No. 4.11)

REFERENCES:A) Books
1. Bhave.S.R., Saga of Security, LIC of India.
2. Henry D., Road to brand equity, Himalaya
Publishing House.
3. Dr. Gupta.S.L., Brand Management, Himalaya
Publishing House.
4. Dr. Joshi .C.J., Textbook of Insurance (B.Com1), Phadake Prakashan.
5. Jha S.M., Service Marketing, Himalaya
Publishing House.
6. Kotler Philip, Marketing Management.
7. Sengupta Subroto, Brand positioning, Tata Macgrew hill Publishing co. Ltd.
B) Journals
1. LIC annual report. 2005-2006.
2. Manual for agent, LIC of India
C) Websites
1. www.licindia.com
2. www. yahoo.com
3. www. google .com
4. www. Wekipedia.com
5. www. tutor2.com
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