Financial Sector Development in India

1.1 Introduction:

The economic policies of early 90's posed opportunities for the financial sector development in India. This contributed directly and robustly to our economic growth. In 1956 life insurance sector was nationalized and hence LIC was born. Private insurance systems harmonize social security systems and add significance by toning risk with price. Insurance! One reads the word and myriad of Agents, Advisors on calls, luring people to secure their life risks, seem to flash the mind in a jiffy. That's just a beginning. If one repeats reading, Gives a thought over it, a totally different picture is viewed. Unlimited working hours, inconceivable attrition rate, unthinkable stress and exhaustion reveals its dreadful side. Every coin has two sides, so is a job in insurance sector. It has both pros and cons, but the ugly side of it is very loud. Insurance sector is in growing demand today, creating lots of job opportunities. It has a promising future. But the HR fraternity is concerned about its attrition issues and is struggling hard to retain talent in insurance sector.

Intense competition and globalization of businesses has put mounting pressure on organizations to deliver more and better than before. Organizations need to develop and organize human resources that can articulate the vision of the organization and make teams with the synergy to perform at much higher levels. Human resource builds and drives the knowledge assets of an organization, the value of which has been established to be many times more than the tangibles. Today, organizations really needs to design bold and breakthrough HR practices for talent acquisition and retention in insurance. This paper attempts to study the attrition issues in insurance sector and explore the factors affecting job satisfaction of employees, particularly sales workforce. In the present scenario it is becoming important for organizations to focus on finding, developing, and retaining talented employees. This paper aims to enhance understanding of the phenomenon of high employee turnover in the insurance industry and factors that lead to job satisfaction of employees. The findings may be helpful for the companies to improve retention levels.

1.2 Indian Insurance Sector at a Glance

The insurance sector in India is one of the fastest growing financial services market in the world. contributing strongly (about 7%) to GDP. The reported growth rate is 15-20% per annum. The new business premiums are growing at the rate of 40% per year. This impressive growth is the result of globalization of sector encouraging the entry of new committed players . The sector has completed a full circle in India from being an open competitive market to nationalization, and back to a liberalized market again. The insurance sector in India is hardly 12 years old and still in its nascent stage of its evolution. Till date, only 20% of the total insurable population of India is covered under various life insurance schemes, the penetration rates of health and other non-life insurances in India is also well below the international level. These facts indicate the of immense growth potential of the insurance sector. The Indian insurance company is growing 360 degrees paving ways for enlarged employment. The sector is human people driven business and the human resources will definitely be the show stoppers. extensively grow at 140% in view of aggressive marketing techniques. The quality of talent acquisition and retention domains are a big challenge for HR in this sector. It would be a real test for them how they are exploiting their Knowledge, skills and abilities and simultaneously meeting their ambitions. Basically insurance is sales-driven industry. The entire business is managed by the sales workforce who have their agents working under them on commission basis. It has always been a challenging job for insurance companies to retain these agents, owing to their high turnover. This in turn affects the sales manager's performance cascading the turnover at their level. This further gets cascaded upwards in the hierarchy. But, the highest turnover is reported to be at the agents level or advisors level where there are no entry and exit barriers, but the work pressures are high.

1.2 Need of the research

The need for this study can be clearly defined in two points:

1. Employee attrition in sales workforce of insurance sector is a burning issue for the blossoming industry of insurance, which needs immediate attention and

2. Various measures are adopted by insurance sector to keep their employees satisfied, but still attrition continues to be on higher end.

1.3 Literature Review

SN TITLE AUTHORS Year and journal RESEARCH QUESTION FINDINGS

1 Effects of nurses job satisfaction on their retention: An Australian perspective Cowlin L 2000, Journal of nursing administration 32(5):283-291 An exploraion of the job satisfaction and retention plans of newly graduated and experienced nurses in NSW and measures the intention of nurses to stay in nursing The greater the satisfaction with professional status, the more the intentions to stay in nursing.

2 Turnover propensity and its causes among singapore nurses: An empirical study Fang Y 2001, International journal of human resource management 12(5):859-871 Examination of variuos antecedants of turnover attempting to identify most critical causes of the turnover problem in singapore: To test previous research frameworks ontheir external validity across the nations Stress throughoutdifferent stages in turnover; professional commitment a significant cause of turnover cognition but not turnover intention; Organizational committmnet and supervisor satisfaction among the top predictors of turnover intentions.

4 Predicting registered job satisfaction and intent to leave Larabee J, Burant C 2003, Journal of nursing administration 33(5):271-283 Investigating the relative influence of nurses attitudes, context of care on job satisfaction and intent to leave. Major predictors of intention to leave is job Dissatisfcation; Major predictor of job satisfation is pscychological empowerment; predictors of psychological empowerment is hardiness, transformational leadership style, group cohesion.

5 The relationships among turnover intentions, job satisfaction and organizational commitment among hospital nurses. Lu K-Y, Chang Y-Y 2002, journal of professional nursing 18(4): 214-219 An investigation of relationships among turnover intentions, professional commitment and job satisfaction of RNs Positive correlation between Job satisfaction and professional commitment, intent to leave organization