A STUDY ON HRM PRACTICES IN SELECT PUBLIC AND ...

A STUDY ON HRM PRACTICES IN SELECT PUBLIC AND PRIVATE SECTOR

LIFE INSURANCE COMPANIES IN CHENNAI CITY

By

Leena Rani.S* , Prof.Dr.G.P.Raman** &Dr.G.Vijaya Kumar***

Abstract

Human resource management practices have the facility to create organizations that are

more bright, flexible and capable than their rivals through the application of policies and

practices that focus on recruiting, selecting, providing the training skill of employees and

directing their best efforts to cooperate within the resource collection of the organization.

The study utilized both primary, secondary data. The primary data collected from the 284

employees of both public and private sector life insurance companies in Chennai city.

Out of 284 samples, 141 samples collected from LIC and 143 from ICICI Prudential Life

Insurance Company Limited. The study found that the LIC managed good HRM

practices as compared with the private sector life insurance, i.e., ICICI Prudential Life

Insurance Company Limited. The study also originates that there is a significant

difference between LIC and ICICI Prudential Life Insurance Company limited

concerning the HRM dimensions, i.e., Recruitment and Selection, Compensation and

Rewards, Performance Appraisal, Teamwork, and Training and Development.

*Ph.D. Research Scholar (Part-Time Category-B), Department of Commerce,

Bharathiyar University, Coimbatore. Email: [email protected]

**Research Supervisor & Guide, Principal (Retd.), Arulmigu Sri Subramanya Swamy

Govt. Arts College, Tiruttani. Email: [email protected].

***Assistant Professor & Research Supervisor, Department of Commerce, Sir

Theagaraya College, Chennai-600 021. Email: [email protected]

The International journal of analytical and experimental modal analysis

Volume XI, Issue X, October/2019

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Introduction

Human Resource Development has taken for granted considerable importance in recent

years, be it a business organization or a bank or insurance company, the development of

human resources is necessary for its well-organized and effective working. In an

evolutionary progression, when developing the economy struggles to achieve higher

levels of living, it can hardly overlook the requirements of developing its human

resources to meet the more significant and novel challenges of raising the quality of the

life of masses(Dey & 2018). The concept of HRD deals with the enhancement of human

quality in general and development of personal skills, standards, comprehensions, and

application in the production enterprises in particular. As such, HRD has become an

essential program of all organizations not only for enhancing production efficiency/

productivity level but also to bring about qualitative improvement among the employees

at different levels. Human resource management is the strength of the character of any

organization, and the life insurance sector is no exception to it. The insurance sector is

that people or customers primarily dominate the service sector. The success of the

insurance business more or less depends upon the effective and efficient human resources

of the companies. The service quality and customer satisfaction can be enhanced by the

behavior and hospitality of insurance employees. This sector has undergone a metaphoric

revolutionize during the last three-decade concerning their human resources management

practices. In today’s competitive and quickly changing business world, organizations

primarily in the service industry, i.e., the insurance sector, need to make specific

maximum utilization of their resources to their advantage, a requirement for

organizational survival. The HRM has transcended from policies that assemble dust to



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practices that produce good results. Human resource management practices have the

facility to create organizations that are more bright, flexible and capable than their rivals

through the application of policies and practices that focus on recruiting, selecting,

providing the training skill of employees and directing their best efforts to cooperate

within the resource collection of the organization. It can potentially consolidate

organization performance and generate competitive advantage as a result of the historical

understanding of human resources and the social complex of policies and practices that

rivals may not be intelligent to imitate or duplicate their diversity and depth. Therefore

the present is undertaken to measure the level of HRM practices and compare the HRM

practices dimensions in both LIC and ICICI Prudential Life Insurance Company Limited.

Review of Literature

(Guest, 1997) Stated that the nature of HRM, and especially the justification for the

specific lists of practices of HR, the nature of organizational performance, and the

connection between HRM and performance. A representation is presented within which

to discover these linkages. The literature on HRM and performance is reviewed in the

glow of this analysis to identify critical gaps in knowledge and help to focus further on

the research priorities. (Allen, Shore, & Griffeth, 2003) Suggest that perceptions of

competent human resources practices (participation in decision making, the fairness of

rewards, and enlargement opportunities) contribute to the expansion of POS, and POS

mediates their associations with organizational commitment and level of job satisfaction.

Further, POS is pessimistically related to withdrawal, but the relationships are also

mediated. Kundu and Malhan (2007) mentioned that the Training & benefits,



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performance appraisal policies, the process of selection of employees, HR planning, &

recruitment approaches were found to be the significant HRM practices followed by

insurance firms in India. The workforce diversity and competitive compensation policies

were also found to be among the critical HRM practices followed by insurance firms.

(Petrescu & Simmons, 2008) Found that numerous HRM practices lift workers' overall

job satisfaction and their satisfaction level with pay. However, these effects are only

crucial for non-union members. Satisfaction with pay is superior, where performance-

related pay and seniority-based reward systems are in place. (Ozolina-Ozola, 2014) The

human resource management practices, which were declared in connection with

employee turnover, were detected and described its effect on employee turnover. By

conducting two separate expert surveys, the initial information about the spread of some

identified human resource management practices and the potential effectiveness of these

practices in Latvian organizations are acquired and analyzed. (Das & Vijayalakshmi,

2015) Point out that a problem of employee turnover increasing particularly at the

inferior level, majority of the employees are satisfied with the organization policies,

work-culture but still improvement is required in some of the HR domain like

performance appraisal, Job design, perks and benefits, Work-life balance, etc are the

main findings of the study. The paper concludes that human resources are an essential

asset, and the success level of any organization ultimately depends on how efficient and

effective its human resources are. (Anitha & Kumar, 2016) Reveals that the training is

given to the employees in the Private Insurance Sector, Coimbatore District improves the

performance level of the employees. The increase is formed in employee productivity

after the training. The education level, staff category and the work experiences of the



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employees are the factors determining the growth of employee’s performance in the

organization after the training. Human Resource is considered an essential resource in an

organization. The employees should be offered with proper training to improve their

efficient and effective functioning in an organization. (Jebolise Chukwuka & Peace

Nwakoby, 2018) The study concludes from the result, as confirmed by the survey that

there was a weak and insignificant effect of HRM practices on employee Retention in the

Nigerian Insurance Industry. However, the study also confirmed that HRM practices have

a positive and significant effect on employee performance. This paper strongly

recommends that the Government, through NAICOM, should help to check the high

handedness of some insurance firms on their employees. Some of the insurance firms fail

to implement Nigerian labor laws and employee work benefits.

Objectives of the Study

The present study’s core objective is to assess the level of HRM practices in select

life insurance companies in Chennai city.

To study and compare the HRM practices namely Recruitment and Selection,

Compensation and Rewards, Performance Appraisal, Teamwork, and Training

and Development in both LIC and ICICI Prudential Life Insurance Companies in

Chennai city

Statement of Hypothesis

The HRM Practices namely Recruitment and Selection, Compensation and

Rewards, Performance Appraisal, Teamwork, and Training and Development are

similar in both LIC and ICICI Prudential Life Insurance Companies in Chennai

city



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Research Methodology

The current study’s core objective is to find out the HRM Practices in both public and

private sector insurance companies in the Chennai city. The study used both secondary

and primary data. The primary data attained from the employees of both public and

private sector life insurance companies in Chennai city. The data collected through

structured questionnaires. The secondary collected to familiarize the research area. The

reviews are collected from the research-based articles which were published in national

and international journals. The samples consisted of 284 employees of public and private

sector life insurance companies. Out of 284 samples, 141 from LIC and 143 from ICICI

Prudential Life Insurance Company Limited. The data were collected from June 2019 to

September 2019. The collected data neatly tabulated in excel sheets and analyzed the

data with the support of SPSS software version 21. The cross-tabulation used to ascertain

the results and Independent t-test used to test the hypothesis of the study.

Data Analysis and Discussion

Demographic profile of the Employees

Table 1

Gender category of Employees of Public and private sector Life Insurance

Companies

Gender Sector Total

LIC ICICI Pru

Male

62 104 166

37.3% 62.7% 100.0%

44.0% 72.7% 58.5%

Female

79 39 118

66.9% 33.1% 100.0%

56.0% 27.3% 41.5%

Total 141 143 284

49.6% 50.4% 100.0%



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100.0% 100.0% 100.0%

Table 1 shows the frequency results of the Gender category of Employees of Public and

private sector Life Insurance Companies in Chennai city. In LIC out of 141 employees,

the majority of 56% of the employees are the female category, and 44% of the employees

are the male category. In ICICI Pru out of 143 employees, the majority 72.7% of the

employees are the male category, and 27.3% of the employees are the female category.

Overall, 58.5% of the employees are male, and 41.5% of the employees are female.

Table 2

Age group of Employees of Public and private sector Life Insurance Companies

Age Sector Total

LIC ICICI Pru

Up to 25 years

26 21 47

55.3% 44.7% 100.0%

18.4% 14.7% 16.5%

26-35 years

46 37 83

55.4% 44.6% 100.0%

32.6% 25.9% 29.2%

36-45 years

44 49 93

47.3% 52.7% 100.0%

31.2% 34.3% 32.7%

46-55 years

18 17 35

51.4% 48.6% 100.0%

12.8% 11.9% 12.3%

Above 55 years

7 19 26

26.9% 73.1% 100.0%

5.0% 13.3% 9.2%

Total

141 143 284

49.6% 50.4% 100.0%

100.0% 100.0% 100.0%

Table 2 reveals the results of the Age group of Employees working in select Public and

private sector Life Insurance Companies. Out of 284 employees, 32.7% 29.2% of the

employees are in the age group of between 36-45 years, followed by 29.2% of the



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employees are in the age group of between 26-35 years, 16.5% of the employees are in

the age group of up to 25 years, 12.3% of the employees are in the age group of 46-55

years, and 9.2% of the employees are in the age group of above 55 years.

Table 3

Marital status of Employees of Public and private sector Life Insurance Companies

Marital Status Sector Total

LIC ICICI Pru

Single

46 44 90

51.1% 48.9% 100.0%

32.6% 30.8% 31.7%

Married

95 99 194

49.0% 51.0% 100.0%

67.4% 69.2% 68.3%

Total

141 143 284

49.6% 50.4% 100.0%

100.0% 100.0% 100.0%

Table 3 highlights the frequency results of the marital status of employees working in

select public and private sector life insurance companies in the study region. In the LIC

majority, 67.4% of the employees are married, and 32.6% of the employees are single. In

ICICI Pru majority, 69.2% of the employees are married, and 30.8% of the employees are

single. In the overall majority, 68.3% of the employees are married, and 31.7% of the

employees are single.

Table 4

Educational Qualification of Employees working in Public and private sector Life

Insurance Companies

Educational Qualification Sector Total

LIC ICICI Pru

Up to HSC

11 23 34

32.4% 67.6% 100.0%

7.8% 16.1% 12.0%

UG 61 48 109

56.0% 44.0% 100.0%



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43.3% 33.6% 38.4%

PG

39 42 81

48.1% 51.9% 100.0%

27.7% 29.4% 28.5%

Professional

30 30 60

50.0% 50.0% 100.0%

21.3% 21.0% 21.1%

Total

141 143 284

49.6% 50.4% 100.0%

100.0% 100.0% 100.0%

Educational Qualification of Employees working in public and private sector Life

Insurance Companies frequency results are shown in Table 4. In LIC and ICICI

Prudential, life insurance company majority of the employees are under-graduates. The

overall majority, 38.4% of the employees are under-graduates, followed by 28.5% of the

employees are post-graduates, 21.1% of the employees are professionals, and 12% of the

employee's educational background is up to HSC.

Table 5

Experience of Employees working in Public and private sector Life Insurance

Companies

Experience Sector Total

LIC ICICI Pru

Up to 3 years

33 37 70

47.1% 52.9% 100.0%

23.4% 25.9% 24.6%

3-6 years

49 41 90

54.4% 45.6% 100.0%

34.8% 28.7% 31.7%

6-9 years

32 39 71

45.1% 54.9% 100.0%

22.7% 27.3% 25.0%

Above 9 years

27 26 53

50.9% 49.1% 100.0%

19.1% 18.2% 18.7%

Total

141 143 284

49.6% 50.4% 100.0%

100.0% 100.0% 100.0%



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Table 5 exhibits the results of the experience of employees working in the public and

private sector Life Insurance Companies. Majority 31.7% of the employees have 3-6

years of experience, followed by 25% of the employees who have work experience

between 6-9 years, 24.6% of the employees have up to 3 years experience, and 18.7% of

the employees have above 9 years of experience in their field.

Level of HRM Practices in LIC and ICICI Prudential Life Insurance Company

Limited

Table 6

Level of HRM Practices in LIC and ICICI Prudential Life Insurance Company Limited

Sector Level of HRM Practices Total

Average Moderate Good

LIC

25 51 65 141

17.7% 36.2% 46.1% 100.0%

35.2% 37.0% 86.7% 49.6%

ICICI Pru

46 87 10 143

32.2% 60.8% 7.0% 100.0%

64.8% 63.0% 13.3% 50.4%

Total

71 138 75 284

25.0% 48.6% 26.4% 100.0%

100.0% 100.0% 100.0% 100.0%

Table 6 shows the results of the Level of HRM Practices in LIC and ICICI Prudential

Life Insurance Company Limited in the study region. In LIC majority 46.1% of the

employees are opined that HRM practices are good, followed by 36.2% of the employees

are feeling that the HRM practices are moderate and 17.7% of the employees are felt that

the HRM practices are average level. In ICICI prudential life Insurance company the

limited majority of 60.8% of the employees have viewed the HRM practices are moderate



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in their organization, followed by 32.2% of the employees are felt that the HRM practices

are average level and 7% of the employees are viewed the HRM practices are sound. The

overall, LIC is managed well by the HRM practices compare with the private sector life

insurance company, i.e., ICICI prudential.

Null Hypothesis 1

The HRM Practices namely Recruitment and Selection, Compensation and

Rewards, Performance Appraisal, Teamwork, and Training and Development are

similar in both LIC and ICICI Prudential Life Insurance Companies in Chennai

city

Table 7

Independent t-test for HRM Practices in both LIC and ICICI Prudential Life Insurance

Companies in the study region

Sector N Mean Std.

Deviation

t p

Recruitment and

selection

LIC 141 3.81 0.89

4.921 <0.001** ICICI Pru 143 3.24 1.05

Compensation and

Reward

LIC 141 3.51 0.84

4.185 <0.001**

ICICI Pru 143 3.07 0.92

Performance

Appraisal

LIC 141 3.75 0.80

4.291 <0.001**

ICICI Pru 143 3.29 0.97

Team Work LIC 141 3.72 0.82

4.014 <0.001**

ICICI Pru 143 3.29 0.94

Training and

Development

LIC 141 3.64 0.78

5.749 <0.001**

ICICI Pru 143 3.08 0.87



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Table 7 depicts the results of Independent t-test for HRM Practices in both LIC and ICICI

Prudential Life Insurance Companies in the study region. The HRM practices dimensions

namely Recruitment and selection (t=4.921 & p=<0.001), Compensation and Reward

(t=4.185 & p=<0.001), Performance Appraisal (t=4.291 & p=<0.001), Team Work

(t=4.014 & p=<0.001),and Training and Development (t=5.749 & p=<0.001). It is

identified from the above results, the p-value for entire HRM practices dimensions are

<0.01. It is less than 0.01. Therefore the framed null hypothesis is rejected and concluded

that there is a significant difference between LIC and ICICI Prudential life insurance

companies concerning HRM Practices. Further, the study inferred that the ‘Recruitment

and selection process’ mean value of LIC (3.81) and ICICI Prudential Life Insurance

company (3.24). It indicates that the recruitment policy and selection are extremely good

in LIC. It implies that the right selection of employees with an adequate level of

qualifications and traits will facilitate the LIC. The compensation and reward factor mean

values of LIC (3.51) and ICICI Prudential Life Insurance (3.07), it inferred that the

compensation packages and reward system are extremely well in LIC compare with the

private sector life insurance company of ICICI Prudential Life. The other important

HRM practices are the performance appraisal system, and the performance appraisal is

properly assessed by the LIC(3.75) than the private sector life insurance company

limited(3.29). The teamwork and training development factors better in LIC as compared

with the private sector life insurance, i.e., ICICI Prudential Life Insurance company

limited. Overall, the study originated that the HRM practices managed well in public



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sector life insurance companies, i.e., LIC as compared with the private sector life

insurance company, i.e., ICICI Prudential life insurance company limited.

Conclusion

The study is proposed to find out the HRM practices in both public and private sector life

insurance companies in Chennai city. The study identified five predominant factors of

HRM practices, namely Recruitment and Selection, Compensation and Rewards,

Performance Appraisal, Teamwork, and Training and Development. The LIC managed

good HRM practices as compared with the private sector life insurance company, i.e.,

ICICI Prudential Life Insurance company limited. The study also inferred that the

majority of employees are satisfied with the HRM practices in LIC. The study also found

that there is a significant difference between LIC and ICICI Prudential Life Insurance

Company limited concerning the HRM dimensions, i.e., Recruitment and Selection,

Compensation and Rewards, Performance Appraisal, Teamwork, and Training and

Development.

References

Allen, D. G., Shore, L. M., & Griffeth, R. W. (2003). The role of perceived

organizational support and supportive human resource practices in the turnover

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Anitha, R., & Kumar, A. (2016). A Study On The Impact Of Training On Employee

Performance In Private Insurance Sector, Coimbatore District. International Journal

of Management Research Dan Review.



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Das, V. T., & Vijayalakshmi, C. (2015). Employee attrition and retention in the life

insurance sector: an empirical study HRM. Peripex-Indian Journal of Research.

Dey, S. K., & Commerce, L. (2018). “ HRM Practices in Indian Banking Sector : A

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Guest, D. E. (1997). Human resource management and performance: A review and

research agenda. International Journal of Human Resource Management.

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Jebolise Chukwuka, E., & Peace Nwakoby, N. (2018). EFFECT OF HUMAN

RESOURCE MANAGEMENT PRACTICES ON EMPLOYEE RETENTION AND

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