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Uploaded bySharon Mansoor
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Swot analysis on bajaj allianz

Bajaj Allianz, a joint venture between Bajaj Finserv and Allianz SE, is a major player in India's insurance market with total assets of Rs 42,995 crore and a network of 722 offices. A SWOT analysis reveals strengths in global exposure and strong services, weaknesses in competition and public perception, opportunities in untapped markets, and threats from regulatory changes and traditional competitors. Despite challenges, the company is well-positioned for growth as perceptions of private insurance improve.

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SWOT Analysis on Bajaj AllianzBy Group IV 1st Year MBA (General), Institute of Management in Kerala
Bajaj Allianz Life Insurance Company Limited-Introduction  Joint venture between Bajaj Finserv Limited and Allianz SE  German based Allianz SE is one of the largest insurance companies in the world and India based Bajaj is one of the biggest 2 & 3 Wheeler manufacturers in the world  Incorporated on 12th March 2001  Head office located at Pune  CEO is Mr. Anuj Agarwal  Total assets of Rs 42,995 Crore  Has 722 offices spread across India  Caters to all financial needs like Protection, Savings, Retirement & Investment of individual and groups
Need for a SWOT Analysis  An indicator of the health of a business  Helps forming strategies to tackle possible threats  Helps prepare to tap possible opportunities  Gives an overview of company’s strengths and weaknesses  Allows an outsider to quickly and effectively understand the company
(i)Strength  Global Exposure in Insurance Through Allianz SE and Strong Local Implementation by Bajaj -Allianz SE in 125 years old and operates in over 70 countries. It is the largest insurance company in the world -Bajaj is a household name in India and is over 110 years old  Large Network - 722 offices spread across India  Strong Financial Base -Total assets of Rs 42,995 Crore -Reported 40% jump in consolidated net profit on 20th October 2015 (source:moneycontrol.com)  Excellent Services -Awarded “Best Life Insurance Company-Private Sector” by LOKMAT Banking, “Economic Times Promising Brand for 2015”  Wide Product Range - Covers Home, Health, Travel, Two-wheeler, Car and Life insurances - Plans can be customized for various preferences
(ii)Weakness  Lot of Competitors with Better Premiums and Offerings -Bajaj Allianz insurance premium of Rs 3,923 whereas Edelweiss Tokio offers premium of Rs 2,923 for insurance of Rs 30 Lakhs, 30 years for a 22 year old male (source:policybazar.com)  Unfavourable Public Perception Towards Private Sector Insurance Comapanies -Total asset of LIC is Rs 1560482 Crores V/s Rs 42,995 Crores of Bajaj Allianz -2,048 Offices of LIC V/s 722 offices of Bajaj Allianz  Low Rural Penetration -Rural business of 6-7% only (source: Economic Times, Sep 15,2013)  Long and Complicated Procedures for Getting Insured -Customers have to undergo lengthy procedures before getting insured
(iii)Opportunities  Untapped Markets -Vast amount of the insurance market is untapped -27% of India’s health-insurance payouts comes from just 6 cities (Source:Business standard,9/9/15)  Insurance Offers Security with High Returns - In a conservative society like India, people are more inclined towards risk free investments (Bank FDs) over high return investments (Share market). Insurance companies offer them both  India’s Large Population -India is the second most populous country in the world, and has many children and people reaching age of retirement - This provides huge opportunities in health insurance, general insurance and retirement plans  Huge Automobile Sector - India is one of the largest automobile markets in the world, with over 40 million vehicles -This provides huge opportunities in two- wheeler as well as car insurance sector
(iv)Threats  Large Number of Competitors -11 Private sector players in Life Insurance sector alone  Increasingly Strict Rules and Supervision by IRDA -Insurance Regulatory and Development Authority brings in stricter rules everyday, which increases burden on insurance companies -Recently IRDA slapped Rs 55 lakh fine on Max Life for violation of rules (source:livemint.com 22/12/2014)  Increased Capital Flow from Abroad -Recently the government has cleared a higher FDI cap for insurance sector at 49% -This might allow the competitors to get capital from abroad  Strong Presence of Traditional Public Sector Competitor - General public continues to hold favorable view towards public sector companies like LIC over private sector companies
Conclusion The insurance market in India presents a lot of opportunities. Bajaj Allianz, being one of the largest players in the field has immense potential in the field. Bajaj Alliance, being a conglomerate of two proven giants has the right mix of financial power, brand image and experience for achieving growth despite the increase in competition. With the gradual change in people’s perception towards private insurance companies, the threat posed by LIC is decreasing. This will allow Bajaj Allianz to secure a more strong position in India’s insurance market.
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