Life insurance get the life secure

A training report submitted in partial fulfilment of the requirement for the degree Of

BACHOLER OF BUSINESS ADMINISTRATION

(2009-2012)

SUBMITTED BY:HARSHEET KAUR

ACKNOWLEDGEMENT

I feel immense pleasure to give the credit of my project work not only to one individual as this work is integrated effort of all those who concerned with it. I want to owe my thanks to all those individuals who guided me to move on the track.

This report entitled ICICI LIFE INSURANCE is the outcome of my summer training at DYNAMIC INVESTMENT SERVICES, SURYA COMPLEX, LEELA BHAVAN (PATIALA)

I would like to appreciate the pain staking effort of Mr. MANIDER SINGH (Managing director) and & Mrs. HARDEEP KAUR (HOM) for educating and guiding me at each and every stage and providing me the information related to my chosen topic. I am equally thankful to the whole team of DYNAMIC INVESTMENT SERVICSE COMPNY, who extended their full co-operation and assistance. Words are not sufficient to express the greatness for the help, guidance and knowledge dispensed to me by Respected Mr. NARESH KUMAR (HEAD OF MARKETING & SALE), who not only lent her considerable time and energy to the understanding, but also helped me a great deal in making this report see the light of the day.

Last but not least, I owe my special regards to my parents and my elders for their blessings and good wish

CONTENTS

Acknowledgement

Chapter - 1 INTRODUCTION Chapter - 2 COMPANY PROFILE Chapter - 3 OBJECTIVES AND SCOPE

Chapter - 4 RESEARCH METHODOLOGY Chapter - 5 DATA ANALYSIS AND INTERPRETATION Chapter - 6 FINDINGS AND CONCLUSIONS Chapter - 7 SUGGESTIONS & RECOMMENDATIONS BIBLIOGRAPHY

CHAPTER 1
INTRODUCTION
What is insurance?

Life Insurance is the key to good financial planning. On one hand, it safeguards your money and on the other, ensures its growth, thus providing you with complete financial well being. Life Insurance can be termed as an agreement between the policy owner and the insurer, where the insurer for a consideration agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness, critical illness or maturity of the policy. Life insurance plans, unlike mutual funds, are beneficial when you look at them as a long term avenue of investment which also offers protection through life cover. Life insurance policies are broadly categorized into 2 types; Traditional Plans and Unit Linked Insurance Plans (ULIPs).

Traditional policies offer in-built guarantees and define maturity benefits through variety of products such as guaranteed maturity value. The investment risk in traditional life insurance policies is borne by life insurance companies. Additionally, the investment decisions are regulated to a large extent by IRDA rules and regulations, ensuring stable returns with minimal risk. Investment income is distributed amongst the policy holders through annual bonus. These policies are ideal for policy holders who are not market savvy and do not wish to take investment risks. ULIPs, on the other hand provide a combination of risk cover and investment. More importantly they offer a flexibility to decide your risk taking profile.

What is a life insurance policy?

A life insurance policy provides financial protection to your family in the unfortunate event of your death. At a basic level, it involves paying small sums each month (called premiums) to cover the risk of your untimely demise during the tenure of the policy. In such an event, your family (or the beneficiaries you have named in the policy) will receive a lumpsum amount. In case you live till the maturity of the policy, depending on the type of life insurance policy you have opted for, you will receive returns the policy may have earned over the years. Today, there are many variations to this basic theme, and insurance policies cater to a wide variety of needs.

TYPES:Term Insurance Policy

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A term insurance policy is a pure risk cover policy that protects the person insured for a specific period of time. In such type of a life insurance policy, a fixed sum of money called the Sum Assured is paid to the beneficiaries (family) if the policyholder expires within the policy term. For instance, if a person buys a Rs 2 lakh policy for 15 years, his family is entitled to the sum of Rs 2 Lakh if he dies within that 15-year period. If the policy holder survives the 15-year period, the premiums paid are not returned back. The advantage, apart from the financial security for an individual s family is that the premiums paid are exempt from tax. These insurance policies are designed to provide 100 per cent risk cover and hence they do not have any additional charges other than the basic ones. This makes premiums paid under such life insurance policies the lowest in the life insurance category.

Whole Life Policy

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A whole life policy covers a policyholder against death, throughout his life term. The advantage that an individual gets when he / she opts for a whole life policy is that the validity of this life insurance policy is not defined and hence the individual enjoys the life cover throughout his or her life. Under this life insurance policy, the policyholder pays regular premiums until his death, upon which the corpus is paid to the family. The policy does not expire till the time any unfortunate event occurs with the individual.

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Increasingly, whole life policies are being combined with other insurance products to address a variety of needs such as retirement planning, etc. Premiums paid under the whole life policies are tax exempt.

Endowment Policy
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Combining risk cover with financial savings, endowment policies are among the popular life insurance policies. Policy holders benefit in two ways from a pure endowment insurance policy. In case of death during the tenure, the beneficiary gets the sum assured. If the individual survives the policy tenure, he gets back the premiums paid with other investment returns and benefits like bonuses. In addition to the basic policy, insurers offer various benefits such as double endowment and marriage/ education endowment plans. In recent times, the concept of providing the customers with better returns has been gaining importance. Hence, insurance companies have been coming out with new and better ULIP versions of endowment policies. Under such life insurance policies the customers are also provided with an option of investing their premiums into the markets, depending on their risk appetite, using various fund options provided by the insurer, these life insurance policies help the customer profit from rising markets. The premiums paid and the returns accumulated through pure endowment policies and their ULIP variants are tax exempt.

Money Back Policy

This life insurance policy is favored by many people because it gives periodic payments during the term of policy. In other words, a portion of the sum assured is paid out at regular intervals. If the policy holder survives the term, he gets the balance sum assured. In case of death during the policy term, the beneficiary gets the full sum assured. New ULIP versions of money back policies are also being offered by various life insurers. The premiums paid and the returns accumulated though a money back policy or its ULIP variants are tax exempt.

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ULIPS
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ULIPs are market-linked life insurance products that provide a combination of life cover and wealth creation options. A part of the amount that people invest in a ULIP goes toward providing life cover,

while the rest is invested in the equity & debt instruments for maximizing returns. They provide the flexibility of choosing from a variety of fund options depending on the customers risk appetite. One can opt from aggressive funds (invested largely in the equity market with the objective of high capital appreciation) to conservative funds (invested in debt markets, cash, bank deposits and other instruments, with the aim of preserving capital while providing steady returns). ULIPs can be usefull for achieving various long term financial goals such as planning for retirement, child s education, marriage etc.

Annuities and Pension

In these types of life insurance policies, the insurer agrees to pay the insured a stipulated sum of money periodically. The purpose of an annuity is to protect against financial risks as well as provide money in the form of pension at regular intervals

The History of Life Insurance

Risk protection has been a primary goal of humans and institutions throughout history. Protecting against risk is what insurance is all about. Over 5000 years ago, in China, insurance was seen as a preventative measure against piracy on the sea. Piracy, in fact, was so prevalent, that as a way of spreading the risk, a number of ships would carry a portion of another ship's cargo so that if one ship was captured, the entire shipment would not be lost. In another part of the world, nearly 4,500 years ago, in the ancient land of Babylonia, traders used to bear risk of the caravan trade by giving loans that had to be later repaid with interest when the goods arrived safely. In 2100 BC, the Code of Hammurabi granted legal status to the practice. It formalized concepts of bottomry referring to vessel bottoms and respondentia referring to cargo. These provided the underpinning for marine insurance contracts. Such contracts contained three elements: a loan on the vessel, cargo, or freight; an interest rate; and a surcharge to cover the possibility of loss. In effect, ship owners were the insured and lenders were the underwriters. Life insurance came about a little later in ancient Rome, where burial clubs were formed to cover the funeral expenses of its members, as well as help survivors monetarily. With Rome's fall, around 450 A.D., most of the concepts of insurance were abandoned, but aspects of it did continue through the Middle Ages, particularly with merchant and artisan guilds. These provided forms of member insurance covering risks like fire, flood, theft, disability, death, and even imprisonment. During the feudal period, early forms of insurance ebbed with the decline of travel and longdistance trade. But during the 14th to 16th centuries, transportation, commerce, and insurance would again reemerge. Insurance in India can be traced back to the Vedas. For instance, yogakshema, the name of Life Insurance Corporation of India's corporate headquarters, is derived from the Rig Veda. The term suggests that a form of "community insurance" was prevalent around 1000 BC and practiced by the Aryans. And similar to ancient Rome, burial societies were formed in the Buddhist period to help families build houses, and to protect widows and children

What is a life insurance policy?

A life insurance policy provides financial protection to your family in the unfortunate event of your death. At a basic level, it involves paying small sums each month (called premiums) to cover the risk of your untimely demise during the tenure of the policy. In such an event, your family (or the beneficiaries you have named in the policy) will receive a lumpsum amount. In case you live till the maturity of the policy, depending on the type of life insurance policy you have opted for, you will receive returns the policy may have earned over the years. Today, there are many variations to this basic theme, and insurance policies cater to a wide variety of needs.

CHAPTER 2
COMPANY PROFILE

 Starting in 1957 With LIC India In 2007 16 new companies The Malhotra committee, appointed in 1993
1. HDFC Standard Life Insurance Company Ltd. 2. Max New York Life Insurance Co. Ltd. 3. ICICI Prudential Life Insurance Company Ltd. 4. Kotak Mahindra Old Mutual Life Insurance Limited. 5. Birla Sun Life Insurance Company Ltd. 6. Tata AIG Life Insurance Company Ltd. 7. SBI Life Insurance Company Limited. 8. ING Vysya Life Insurance Company Private Limited. 9. Met life India Insurance Company Ltd. 10. Royal Sundaram Life Insurance Company Limited. 11. Aviva Life Insurance Co. India Pvt. Ltd. 12. Sahara India Insurance Company Ltd. 13. Shriram Life Insurance Company 14. Life Insurance Corporation of India. 15. Reliance Life Insurance Company Limited. 16. Bharti AXA Life Insurance Company Limited
ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, one of the foremost financial services companies of India and Prudential plc, one of the leading international financial services group headquartered in the United Kingdom. ICICI Prudential was amongst the first private sector life insurance companies to begin operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA).

ICICI Prudential Life's capital stands at Rs. 4,780 crores (as of September 30, 2010) with ICICI Bank and Prudential plc holding 74% and 26% stake respectively. For the period April 1, 2010 to September 30, 2010, the company garnered Rs 7,267 crores of total premiums and has underwritten over 10 million policies since inception. The company has a network of over 1,500 offices and over 1,60,000 advisors, as on September 30, 2010. The company has assets held over Rs. 65,000 crores as on September 30, 2010. For the past nine years, ICICI Prudential Life has maintained a wide range of Life Insurance products that meet the needs of the Indian customer at every step in life. ICICI Prudential Life recently completed 10 years on the Indian Insurance scape on 12th December 2010.
Type Private limited company Industry Insurance Headquarters Mumbai Key people Sandeep Bakshi, Managing Director Products Individual and Group Insurance Plans Website Official Website

CHAPTER 3 SCOPE & OBJECTIVE

Scope of the study



 This study can be conducted by comparing the performances & products of three private & government insurance players in insurance industry

 The number of respondents to be surveyed can be Improved.  The study can be conducted in Amritsar city only.  This study can be conducted to analyze the market stand of Reliance Life Insurance Company Limited and Life Insurance Corporation of India Insurance companies

OBJECTIVE
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To study the benefits of this product provided by HDFC Standard Life Insurance company. To know the consumer feedback.

To know the marketing strategies adopted to promote these products. To make the private players responsible to the investors and not to the government. To increase the competition in this sector so that the common people has the advantage of enjoying quality services at a reasonable cost Insurance has a far-reaching effect in synchronizing between the various service sectors. So if this sector can grow, the prospects of the various other service sector remains to be promising.

CHAPTER- 4 RESEARCH
METHODOLOGY

RESEARCH METHODOLOGY
This report is based on primar y as well second ar y data, how e ver primar y da ta collection was given more importance since it is overhearing factor in attitude studies. One of the most important users of research methodology is that it helps in identifying the problem, collecting, analyzing the required information data and providing an alternative solution to the problem .It also helps in collecting the vital information that is required by the top management to assist them for the better decision making both day to day decision and critical ones.

Data sources:
Research is totally based on primary data. Secondary data can be used only for the reference. Research has been done by primary data collection, and primary data has been collected by interacting with various people. The secondary data has been collected through various journals and websites.

Duration of Study:
The study was carried out for a period of two months, from 1June to 31 July

Sampling:
Sampling procedure:
The sample was selected of them who are the customers/visitors of State Bank if India, Boring Canal Road Branch, irrespective of them being investors or not or availing the services or not. It was also collected through personal visits to persons, by formal and informal talks and through filling up the questionnaire prepared. The data has been analyzed by using mathematical/Statistical tool.

Sample size:
The sample size of my project is limited to 100 people only. Out of which only 35 people had taken the life insurance. Other 65 people already took that policy.

Limitation:
1.Some of the persons were not so responsive.
2. Possibility of error in data collection because many of investors may have not given actual answers of my questionnaire.

3. Some respondents were reluctant to divulge personal information which can affect the validity of all responses.

4. The research is confined to a certain part of Patiala.

CHAPTER 6 FINDING & CONCLUSION

Finding

y In Patiala in the Age Group of 36-40 years were more in numbers. The second most Investors were in the age group of 41-45 years and the least were in the age group of below 30 years.

y In Pat iala most of the Investor s were Graduate or P ost Gr aduate a nd below HSC there were very few in numbers. y In Occupation gr oup most of the In ve st ors w ere G ovt. empl o yee s , the second most Investors were Private employees and the least were associated with Agriculture.

y In family Income group, between Rs. 2 0 , 0 0 0 - 3 0 , 0 0 0 w e r e m o r e i n numbers, the second most were in the Income group of more than Rs.30, 000 and the least were in the group of below Rs. 10,000.

y Almost all people take the life insurances policy. Because now that is very important because it give the secure life.