You are on page 1of 46

A

PROJECT
ON

“TO STUDY THE BEHAVIORAL PATTERN OF THE


INVESTORS FOR LIFE INSURANCE”

FOR

ICICI PRUDENTIAL LIFE INSURANCE


COMPANY LTD.
PATAN

Submitetd to

Dr. Ashwin Modi


( Faculty member )
S.K School of Business Management
Hemchandracharya North Gujarat University, Patan.

(In Partial fulfillment of the Requirement for the subject of


'Entrepreneurship Development And Project Mgt as a part of
Semester-II in Post Graduate Diploma In Financial Services
Management'.)

SUBMITTED BY :-

Tejas Soni (36)


Ashwin Chaudhary (15)
Nima Patel (22)
Sunita Prajapati (27)
ACKNOWLEDGEMENT

On this occasion, I would also like to thank to all those people who have
helped me directly or indirectly during my project work.

I would like to thank Our H.O.D. Mr. Nishit Bhatt who has given me
such opportunity which will help me in my future. I am also very thankful to my
project guide Mr. Ashwin Modi for providing the full guidance during my
project work and motivated me through out the fulfillment of my project.

I am very thankful to ICICI Prudential Life Insurance Company Limited


for giving me the opportunity to undergo training in their esteemed organization.

I would like to thank to Mr. Sunil Patel the channel development


manager of ICICI Prudential Life Insurance Company Limited -Patan and Mr.
Mehul Parmar the Unit manager of ICICI Prudential Life Insurance Company
Limited -Patan for giving me training in my project.

And at last but not the least I also express my sincere thanks to all my
respondents, without their cooperation and help; I could not be able to complete
my study.

Tejas Soni
Ashwin
Chaudhary
Nima Patel
Sunita Prajapati
EXECUTIVE SUMMARY

The project topic assigned to me was “To study the behaviour pattern
of Investors for Life insurance” at ICICI Prudential Life Insurance Company
Ltd, Surat.

The sample size was 50. The data was collected through contacting
personal Interview. The approach to interview was questionnaire. Analysis
includes the behavior pattern of the investors. At the time of investment
actually what they keep in mind to invest money. How they approach to life
insurance.

This report talks about the behavioral pattern of the investors in life
insurance policies. While building up the report there are various things,
which we have found out like there are many people who are interested in
investing in life insurance policies for reasons like education for children, tax
benefits, increasing wealth and many more.

This study will also throw light on how their profile affect the behavior
pattern of the investors.
TABLE OF CONTENTS

No. Contents Page No.


1 Industry Profile
2 Company Profile
3 Research Methodology
• Research objective
• Research design
• Sources of data
• Research approach
• Research instrument
• Sampling plan
• Limitations
4 Data Analysis
5 Conclusion
6 Annexure
7 Bibliography
BRIEF HISTORY OF INSURANCE

Life Insurance in its modern form came to India from England in the year 1818. Oriental
Life Insurance Company started by Europeans in Calcutta was the first life insurance
company on Indian Soil. All the insurance companies established during that period were
brought up with the purpose of looking after the needs of European community and
Indian natives were not being insured by these companies. However, later with the efforts
of eminent people like Babu Muttylal Seal, the foreign life insurance companies started
insuring Indian lives. But Indian lives were being treated as sub-standard lives and heavy
extra premiums were being charged on them. Bombay Mutual Life Assurance Society
heralded the birth of first Indian life insurance company in the year 1870, and covered
Indian lives at normal rates. Starting as Indian enterprise with highly patriotic motives,
insurance companies came into existence to carry the message of insurance and social
security through insurance to various sectors of society. Bharat Insurance Company
(1896) was also one of such companies inspired by nationalism. The Swadeshi movement
of 1905-1907 gave rise to more insurance companies. The United India in Madras,
National Indian and National Insurance in Calcutta and the Co-operative Assurance at
Lahore were established in 1906. In 1907, Hindustan Co-operative Insurance Company
took its birth in one of the rooms of the Jorasanko, house of the great poet Rabindranath
Tagore, in Calcutta. The Indian Mercantile, General Assurance and Swadeshi Life (later
Bombay Life) were some of the companies established during the same period. Prior to
1912 India had no legislation to regulate insurance business. In the year 1912, the Life
Insurance Companies Act, and the Provident Fund Act were passed. The Life Insurance
Companies Act, 1912 made it necessary that the premium rate tables and periodical
valuations of companies should be certified by an actuary. But the Act discriminated
between foreign and Indian companies on many accounts, putting the Indian companies
at a disadvantage.
The first two decades of the twentieth century saw lot of growth in insurance business.
From 44 companies with total business-in-force as Rs.22.44 crore, it rose to 176
companies with total business-in-force as Rs.298 crore in 1938. During the mushrooming
of insurance companies many financially unsound concerns were also floated which
failed miserably. The Insurance Act 1938 was the first legislation governing not only life
insurance but also non-life insurance to provide strict state control over insurance
business. The demand for nationalization of life insurance industry was made repeatedly
in the past but it gathered momentum in 1944 when a bill to amend the Life Insurance
Act 1938 was introduced in the Legislative Assembly.

However, it was much later on the 19th of January, 1956, that life insurance in
India was nationalized. About 154 Indian insurance companies, 16 non-Indian companies
and 75 provident were operating in India at the time of nationalization. Nationalization
was accomplished in two stages; initially the management of the companies was taken
over by means of an Ordinance, and later, the ownership too by means of a
comprehensive bill. The Parliament of India passed the Life Insurance Corporation Act
on the 19th of June 1956, and the Life Insurance Corporation of India was created on 1st
September, 1956, with the objective of spreading life insurance much more widely and in
particular to the rural areas with a view to reach all insurable persons in the country,
providing them adequate financial cover at a reasonable cost.

Some of the important milestones in the life insurance business in India:

 1818: Oriental Life Insurance Company, the first life insurance company on
Indian soil started functioning.
 1870: Bombay Mutual Life Assurance Society, the first Indian life insurance
company started its business.
 1912: The Indian Life Assurance Companies Act enacted as the first statute to
regulate the life insurance business.
 1928: The Indian Insurance Companies Act enacted to enable the government to
collect statistical information about both life and non-life insurance businesses.
 1938: Earlier legislation consolidated and amended to by the Insurance Act with
the objective of protecting the interests of the insuring public.
 1956: 245 Indian and foreign insurers and provident societies are taken over by
the central government and nationalised. LIC formed by an Act of Parliament,
viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the
Government of India.

The General insurance business in India, on the other hand, can trace its roots to the
Triton Insurance Company Ltd., the first general insurance company established in the
year 1850 in Calcutta by the British.

The Indian insurance industry is segmented into two distinct markets: the life insurance
market and the non-life, or general, insurance market. The history of life insurance in
India can be traced from 1818.
THE KEY FEATURES OF LIFE INSURANCE INDUSTRY

Nomination: -When one makes a nomination, as the policyholder you continue to be the
owner of the policy and the nominee does not have any right under the policy so long as
you are alive. The nominee has only the right to receive the policy monies in case of your
death within the term of the policy.

Assignment :-If your intention is that your policy monies should go only to a particular
person, you need to assign the policy in favor of that person

Death Benefit: -The primary feature of a life insurance policy is the death benefit it
provides. Permanent policies provide a death benefit that is guaranteed for the life of the
insured, provided the premiums have been paid and the policy has not been surrendered.

Cash Value: -The cash value of a permanent life insurance policy is accumulated
throughout the life of the policy. It equals the amount a policy owner would receive, after
any applicable surrender charges, if the policy were surrendered before the insured's
death.

Dividends: -Many life insurance companies issue life insurance policies that entitle the
policy owner to share in the company's divisible surplus.

Paid-Up Additions: -Dividends paid to a policy owner of a participating policy can be


used in numerous ways, one of which is toward the purchase of additional coverage,
called paid-up additions.

Policy Loans: -Some life insurance policies allow a policy owner to apply for a loan
against the value of their policy. Either a fixed or variable rate of interest is charged. This
feature allows the policy owner an easily accessible loan in times of need or opportunity.

Conversion from Term to Permanent: -When in need of temporary protection,


individuals often purchase term life insurance. If one owns a term policy, sometimes a
provision is available that will allow her to convert her policy to a permanent one without
providing additional proof of nsurability.
Disability Waiver of Premium

Waiver of Premium is an option or benefit that can be attached to a life insurance policy
at an additional cost. It guarantees that coverage will stay in force and continue to grow.

THE BENEFITS OF LIFE INSURANCE

Risk cover: -Life Insurance contracts allow an individual to have a risk cover against any
unfortunate event of the future.

Tax Deduction: - Under section 80C of the Income Tax Act of 1961 one can get tax
deduction on premiums up to one lakh rupees. Life Insurance policies thus decrease the
total taxable income of an individual.

Loans: - An individual can easily access loans from different financial institutions by
pledging his insurance policies.

Retirement Planning: - What had provided protection against the financial


consequences of premature death may now be used to help them enjoy their retirement
years. Moreover the cash value can be used as an additional income in the old age.

Educational Needs: - Similar to retirement planning the cash values that flow from ones
life insurance schemes can be utilized for educational needs of the insurer or his children.

ROLE OF LIFE INSURANCE IN THE GROWTH OF THE ECONOMY

The Life Insurance Industry has an enviable track record among public sector units. It has
a Consistent profit and dividend paying record accompanied by a steady growth in its
financial resources. Through investments in the Government sector and socially- oriented
sectors the Industry has contributed immensely to the nation's development. The industry
is recognized as one of the largest financial Institutions in the country. The ventures
initiated by the industry in the areas of Mutual Fund, Housing Finance has done
exceedingly well in recent years. To protect the country's foreign exchange reserves, the
reinsurance arrangement are so organized that maximum retention is made possible
within the country while at the same time protecting interests of the policy holders.

INDIA AGAINST THE GLOBAL MARKETS

India is an under-insured market India’s insurance market is still at an early stage of


development. This is reflected in low penetration rates and low premiums per capita.

Insurable population – only 10% of India’s population have life insurance According
to ING only 10% of the population is insured, which represents around 30% of the
insurable population. This suggests more than 300m people, with the potential to buy
insurance, remain uninsured

Global perspective – India ranks 19th on the global stage

India represents only around 0.66% market share (ranked 19th) of global insurance

premiums. As of 2004 the largest markets in size are the US (50x bigger than India),
Japan and the UK. Out of the Asian countries (ex Japan), South Korea is the largest
insurance market, Comprising 2.12% of global premiums, followed by China with
1.61%.

While insurance continues to reach out to the masses, India’s insurance penetration
(premiums as a percentage of GDP) still remains very low at 3.2%. This can be split
between life penetration of 2.6% and non-life of 0.6%. On the world stage, penetration
rates are significantly below developed markets such as the US (9.4%), UK (12.6%) and
Australia (8%). Compared with Asian markets, India still falls well short of its nearest
peers with countries such as Japan, South Korea and Taiwan having some of the highest
penetration rates in the world (between 9% and 14%). Nevertheless, despite current low
spend on insurance, the trends in India remain positive. Since the opening up of the
market to foreign players in 2000, penetration has more than doubled from 1.5%. With
foreigners gaining momentum and building the insurance, coupled with India’s favorable
macro overlay, we expect penetration rates to continue to expand.
FUTURE OF LIFE INAURANCE SCHEMES

The Indian Life insurance sector will register a high growth rate in the future years to
come says the report prepared by Fitch Ratings. This will be due to the innovative
products, better distribution network, better services coupled with other never-before
changes that have taken place in the insurance sector.

In Nov 2005 the Indian Life insurance industry saw a growth of 46 %. This rally is
expected to continue as people realize the importance of risk management. The private
sector players are expected to grow with their innovative and profitable life insurance
schemes.

INSURANCE REGULATORY AUTHORITY

On the recommendation of Malhotra Committee, an Insurance Regulatory Development


Act (IRDA) passed by Indian Parliament in 1993. Its main aim was to activate an
insurance regulatory apparatus essential for proper monitoring and control of the
Insurance industry.

Due to this Act several Indian private companies have entered into the insurance market,
and some companies have joined with foreign partners. In economic reform process, the
Insurance Companies has given boost to the socio-economic development process. The
huge amount of funds that are at the disposal of Insurance Companies are directed as
desired avenues like housing, safe drinking water, electricity, primary education and
infrastructure. Above all the policyholders gets better pricing of products from
competitive insurance companies.

Liberalization

The opening up of Insurance sector was a part of the ongoing liberalization in the
financial sector of India. The domain of State-run insurance companies was thrown open
to private enterprise on December 7, 1999, with the introduction of the Insurance
Regulatory and Development Authority (IRDA) Bill. The opening up of the sector gave
way to the world known names in the industry to enter the Indian market through tie-ups
with the eminent business houses. What was once a quiet business is becoming one of the
hottest businesses today.

Post liberalization

The changing face of financial sector and the entry of several companies in the field of
Life Insurance segment are one of the key results of these liberalization efforts. Insurance
business by way of generating premium income adds significantly to the GDP. Despite
the fact that the market is vast in India for the Insurance business, the coverage is far less
compared with the international standards. Estimates show that a meager 35-40 million,
out of a population of 950 million, have come so far under the umbrella of the insurance
industry. The potential market is so huge that it can grow by 15 to 17 per cent per annum.
With the entry of private players, the Indian Insurance Market may finally be able to
make deeper penetration in to newer segments and expand the market size manifold. The
quality of service will also improve and there will be wide The Life insurance market in
India is likely to be risky in the initial stages, but this will improve in the next three to
five years Therefore, it may be advantageous to be a second-round entrant. In the Life
insurance market the need risk assessment systems and data that are the key to success in
the Life insurance market are significantly underdeveloped in India even today.

MAJOR MARKET PLAYERS

Presently there are 15 Life insurance companies in the country. There is only one public
sector company LIC and the rest 14 are private sector. Although LIC has been
dominating the Life Insurance business since past few years the private players have now
started to take the momentum.
Major market players

Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India is a 100% government held Public Sector Company.
Being the first to be established LIC is the forerunner in the Life Insurance sector. The
market share for the first eight months of FY 2005-06 is 73.91%.

ICICI Prudential Life Insurance

ICICI Prudential Life is a 74:26 joint venture between ICICI and Prudential. It is a
private sector company. The company was registered on 24/11/2000. The market share
for the first eight months of FY 2005-06 is 7.11%.

Birla Sun Life Insurance Company

Birla Sun Life Insurance Company is a 74:26 joint venture between Birla group and Sun
Life Financial. It is a private sector company. The company was registered on 31/1/2001.
The market share for first the eight months of FY 2005-06 is 1.84%.

HDFC – Standard

HDFC standard is a 74:26 joint venture between HDFC and Standard Life. It is a private

sector company. The company was registered on 23/10/2000. The market share for the
first eight months of FY 2005-06 is 2.96%.

OM Kotak Mahindra old Mutual

OM Kotak Mahindra is a 74:26 joint venture between Kotak Mahindra bank and Old
Mutual. It is a private sector company. The company was registered on 10/1/2001. The
market share for the first eight months of FY 2005-06 is 0.71%.
Royal Sundaram

Royal Sundaram marks the coming together of Sundaram Finance, one of India’s most
respected and trusted finance companies, and Royal and Sun Alliance, one of the largest
insurance groups in the world.

Max New York Life

Max New York Life is a 74:26 joint venture between J & Bank, Pallonji & Co and
MetLife. It is a private sector company. The company was registered on 6/8/2001. The
market share for the first eight months of FY 2005-06 is 1.32%.

AMP SANMAR

Amp Sanmar was purchased by Reliance group in 3Q2005. It was registered as a private
sector insurance company on 3/1/2002.The market share for the first eight months of FY
2005-06 is 0.54%.

Aviva Life Insurance India

Aviva Life insurance is a 74:26 joint venture between Aviva and Dabur. It is a private
sector company. The company was registered on 14/5/2002. The market share for the
first eight months of FY 2005-06 is 1.12%.

ING Vysya Life insurance

ING Vysya Life Insurance is joint venture between Exide (50%), Gujarat Cements
(14.87%), Enam (9.13%) and ING (26 %). It is a private sector company. The company
was registered on 2/8/2001. The market share for the first eight months of FY 2005-06 is
0.63%.
Met Life India

Met Life India is a 74:26 joint venture between 74:26 JV between J & Bank, Pallonji &
Co and MetLife. It is a private sector company. The company was registered on 6/8/2001.
The market share for the first eight months of FY 2005-06 is 0.40%.

Allianz Bajaj Life Insurance Co.

Allianz Bajaj Life Insurance Company is a 74: 26 Joint venture between Bajaj Auto
limited and Allianz AIG. The company was registered on 3/8/2001. The market share for
the first eight months of FY 2005-06 is 6.12%.

SBI Life Insurance Company Ltd:

SBI Life Insurance Company is a 74: 26 Joint venture between SBI and Cardiff S.A. The
company was registered on 31/3/2001.It is a private sector company. The market share
for the first eight months of FY 2005-06 is 1.52%.

The TATA AIG Group

TATA AIG group is a 74:26 JV between Tata Group and AIG. It belongs to the private
sector. The company was registered on 12/2/2001. The market share for the first eight
months of FY 2005-06 is 1.78%.

Sahara India Life Insurance Company Ltd.

First Wholly Indian Owned Private Life Insurance Company. The Company commenced
operations from 30th October 2004.

Shriram life insurance company Ltd

Shriram Life is a recent entrant into the life insurance sector It is a 74:26 joint venture
between the Shriram group through its Shriram Financial Holdings and Sanlam Life
Insurance Limited, South Africa. The company expects to start operations soon.
PRODUCT RANGE

Life insurance is all about making sure your family has adequate financial resources to
make those plans and dreams come true. It provides financial protection to help your
family or business to manage after your death.

Whole life policies - Cover the insured for entire life. The insured does not receive
money while he is alive; the nominee receives the sum assured plus bonus upon death of
the insured.

Endowment policies - Cover the insured for a specific period. The insured receives
money on survival of the term and is not covered thereafter.

Money back policies - The nominee receives money immediately on death of the
insured. On survival the insured receives money at regular intervals during the term.
These policies cost more than endowment with profit policies.

Children's policies - The nominee receives a guaranteed amount of money at a pre-


determined time and not immediately on death of the insured. On survival the insured
receives money at the same pre-determined time. These policies are best suited for
planning children's future education and marriage costs.

Annuities/Pension schemes - are policies that provide benefits to the insured only upon
retirement. If the insured dies during the term of the policy, his nominee would receive
the benefits either as a lump sum or as a pension every month.

Since a single policy cannot meet all the insurance objectives, one should have a portfolio
of policies covering all the needs.
THE MAJOR DISTRIBUTION CHANNELS

Retail Banks

While a lot of bank relationships with insurance companies have been established, life
insurance sales have been slower than one would expect he primary bank insurance
activities have been the distribution of annuities, credit life, and direct marketing
insurance. Banks are failing to incorporate successful sales tactics used to sell other
financial services like investments.

Full-Service Brokers

Brokerage firms have gained much of the institutional and personal trust business lost by
the banks. These firms have steadily captured assets, primarily at the expense of the
banks. The number of non-bank trust companies has increased in recent years as
independent trust companies have emerged and more broker/dealers are integrated
services. Insurance companies view full-service brokers as a potentially new distribution
channel as well.

Discount Brokers and Online Financial Services

Direct sales of life insurance are growing rapidly, but many of the traditional full-serve
players seem to be letting it go. Across all financial services, consumers are expressing a
willingness to deal with a variety of providers on the web. Web sites are starting to pop
up offering consumer insurance products especially designed for distribution over the
web.

Independent Advisors

To gain a better understanding of the demand amongst independent advisors for trust
services and to gain a better feel for how independent advisors handle trust services, a
research was performed with independent advisors across several broker/dealers and
custodians. The interviews revealed that demand is greatest for living trusts among
independent advisors, followed by demand for corporate trustee services.
Life Insurance Agents, CPAs, & Lawyers

Independent insurance agents represent a number of companies and can research these
companies’ products to find the right combination for their clients. Independent agents &
insurance producer groups are growing in prevalence. Although producer groups are in

their infancy, their emergence may potentially be realignment in the distribution of


financial services. Independent shops realized that by pooling production and funding a
central support office, they had increased buying power.

PERFORMANCE

A robust 36 per cent increase in business by country's largest insurer LIC and strong
performance by most of the private players pushed the overall life insurance growth to 46
per cent in April-November 2005. With competition intensifying, the 14 life-insurers
collected Rs 16,604 crores in new premium in the first eight months of 2005-06
compared to Rs 11,337 crores in the year ago period, according to data compiled by
regulator IRDA. State-owned Life Insurance Corporation gave a tough fight to private
players, who were fast increasing their market share, to collect Rs 12,271 crores in new
premium by selling over 1.3 crores policies.

The 13 private players led by ICICI Prudential and Bajaj Allianz are leaving no stones
unturned to expand business by netting more policyholders to increase their market share.
Among private players, ICICI Prudential ranked at the top by collecting about Rs 1,180
crores after logging 73 per cent growth, followed by Bajaj Allianz, which increased
business by 264 per cent to collect Rs 1,016 crores in premium. ICICI Prudential had a
market share of 7.11 per cent while Bajaj Allianz increased its market pie to 6.12 per
cent.
HDFC Standard Life had a market share of 2.96 per cent, followed by Birla Sunlife (1.84
per cent), Tata AIG (1.78 per cent), SBI Life (1.52 per cent), Max New York Life (1.32
per cent) and Aviva (1.12 per cent). Other players -- Kotak Mahindra Old Mutual, ING
Vysya, AMP Sanmar, Met Life and Sahara Life -- each had less than one per cent of the
market.

HDFC Standard collected Rs 491 crores in premium income till November, followed
Birla Sunlife (Rs 305 crores), Tata AIG (Rs 296 crores), SBI Life (Rs 252 crores), Max
New York Life (Rs 219 crores) and Aviva (Rs 186 crores).

In group insurance, LIC continued to dominate with a market share of about 81.32 per
cent by covering 8.638 million lives till November this fiscal. Among the private
insurers, SBI Life was at the top with a market share of 5.27 per cent, followed by Tata
AIG (4.16 per cent), ICICI Prudential (2.34 per cent), Met Life (1.9 per cent), Aviva
(1.16 per cent) and Bajaj Allianz (1.14 per cent).

First Year Premium Underwritten By Life Insurers For The Period Ended November
2005

l.No Insurer Market Sahre(%)


1 LIC 73.91
2 Bajaj Allianz 6.12
3 ING Vysya 0.63
4 AMP Sanmar 0.54
5 SBI Life 1.52
6 Tata AIG 1.78
7 HDFC Standard 2.96
8 ICICI Prudential 7.11
9 Birla SunLife 1.84
10 Aviva 1.12
11 Kotak Mahnidra Old Mutual 0.71
12 Max New York 1.32
13 Met Life 0.40
14 Sahara Life 0.06
COMPANY PROFILE

India's Number One private life insurer, ICICI Prudential Life Insurance Company is
a joint venture between ICICI Bank-one of India's foremost financial services
companies-and Prudential plc- a leading international financial services group
headquartered in the United Kingdom. Total capital stands at Rs. 18.15 billion, with
ICICI Bank holding a stake of 74% and Prudential plc holding 26%.

They began their operations in December 2000 after receiving approval from
Insurance Regulatory Development Authority (IRDA). Today, the PruICICI having
nation-wide team comprises, about 450 branches, over 150,000 insurance advisors
and 18 bancassurance partners.

ICICI Prudential was the first life insurer in India to receive a National Insurer
Financial Strength rating of AAA (Ind) from Fitch ratings.

VISION:
To make ICICI Prudential the dominant Life and Pensions player built on trust by
world-class people and service.

IT WILL BE ACHIEVED THROUGH:

 Understanding the needs of customers and offering them superior products and
service

 Leveraging technology to service customers quickly, efficiently and


conveniently
 Developing and implementing superior risk management and investment
strategies to offer sustainable and stable returns to our policyholders
 Providing an enabling environment to foster growth and learning for our
employees

 building transparency in all their dealings.

VALUES:
Every member of the ICICI Prudential team is committed to 5 core values: Integrity,
Customer First, Boundaryless, Ownership, and Passion.

ABOUT COMPANIES

ICICI Bank is India's second largest bank and largest private sector bank with
assets of Rs. 2823.72 billion as on September 30, 2006. ICICI Bank provides a broad
spectrum of financial services to individuals and companies. This includes
mortgages, car and personal loans, credit and debit cards, corporate and
agricultural finance. The Bank services a growing customer base through a multi-
channel access network which includes over 635 branches and extension counters,
2325 ATMs, call centers and Internet banking.

Prudential
Established in London in 1848, Prudential plc, through its businesses in the UK and
Europe, the US and Asia, provides retail financial services products and services to more
than 21 million customers, policyholder and unit holders worldwide. As of June 30, 2006,
the company had over £234 billion in funds under management. Prudential has brought to
market an integrated range of financial services products that now includes life assurance,
pensions, mutual funds, banking, investment management and general insurance. In Asia,
Prudential is the leading European life insurance company with a vast network of 23 life
and mutual fund operations in twelve countries - China, Hong Kong, India, Indonesia,
Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand and Vietnam.

For the past six years, ICICI Prudential has retained its position as the No. 1 private
life insurer in the country, with a wide range of flexible products that meet the needs
of the Indian customer at every step in life.

Distribution

ICICI Prudential has one of the largest distribution networks amongst private life insurers
in India. As of December 31, 2006 it had commenced operations in over 360 cities and
towns in India, stretching from Bhuj in the west to Guwahati in the east, and Jammu in
the north to Trivandrum in the south, and had over 175,000 advisors.

The company has 18 bancassurance partners, having tie-ups with ICICI Bank, Bank of
India, Federal Bank, South Indian Bank, Lord Krishna Bank, all regional rural banks
sponsored by Bank of India, as well as some co-operative banks. It has also tied up with
NGOs, MFIs and corporates for the distribution of rural policies.

Products
ICICI Prudential Life Insurance offers a range of innovative, customer-centric products
that meet the needs of customers at every life stage. Its products can be enhanced with up
to 4 riders, to create a customized solution for each policyholder.

 Savings & Wealth Creation Solutions CashPlus is a transparent, feature-packed


savings plan that offers 3 levels of protection as well as liquidity options.
 Save'n'Protect is a traditional endowment savings plan that offers life protection
along with adequate returns.
 CashBak is an anticipated endowment policy ideal for meeting milestone
expenses like a child's marriage, expenses for a child's higher education or
purchase of an asset. It is available for terms of 15 and 20 years.
 LifeTime Super & LifeTime Plus are unit-linked plans that offer customers the
flexibility and control to customize the policy to meet the changing needs at
different life stages. Each offer 4 fund options - Preserver, Protector, Balancer and
Maximiser.
 LifeLink Super is a single premium unit linked insurance Plan which combines
life insurance cover with the opportunity to stay invested in the stock market
 Premier Life Gold is a limited premium paying plan specially structured for
long-term wealth creation.
 InvestShield Life New is a unit linked plan that provides premium guarantee on
the invested premiums and ensures that the customer receives only the benefits of
fund appreciation without any of the risks of depreciation.
 InvestShield Cashbak is a unit linked plan that provides premium guarantee on
the invested premiums along with flexible liquidity options.
Protection Solutions
 LifeGuard is a protection plan, which offers life cover at low cost. It is available
in 3 options - level term assurance, level term assurance with return of premium
& single premium.
 HomeAssure is a mortgage reducing term assurance plan designed specifically to
help customers cover their home loans in a simple and cost-effective manner.

Child Plans

 Education insurance under the SmartKid brand provides guaranteed


educational benefits to a child along withlife insurance cover for the parent who
purchases the policy. The policy is designed to provide money at important
milestones in the child's life. SmartKid plans are also available in unit-linked
form - both single premium and regular premium.

Retirement Solutions

 ForeverLife is a traditional retirement product that offers guaranteed returns for


the first 4 years and then declares bonuses annually.
 LifeTime Super Pension is a regular premium unit linked pension plan that helps
one accumulate over the long term and offers an annuity option (guaranteed
income for life) at the time of retirement.
 LifeLink Super Pension is a single premium unit linked pension plan.
 Immediate Annuity is a single premium annuity product that guarantees income
for life at the time of retirement. It offers the benefit of 5 payout options.

Health Solutions

 Health Assure and Health Assure Plus: Health Assure is a regular premium plan
which provides long term cover against 6 critical illnesses by providing
policyholder with financial assistance, irrespective of the actual medical expenses.
Health Assure Plus offers the added advantage of an equivalent life insurance
cover.
 Cancer Care: is a regular premium plan that pays cash benefit on the diagnosis
as well as at different stages in the treatment of various cancer conditions.
 Diabetes Care: Diabetes Care is the first ever critical illness product specially for
individuals with Type 2 diabetes. It makes payments on diagnosis on any of 6
diabetes related critical illnesses, and also offers a coordinated care approach to
managing the condition. Diabetes Care Plus also offers life cover.

Group Insurance Solutions


ICICI Prudential also offers Group Insurance Solutions for companies seeking to enhance
benefits to their employees.

Group Gratuity Plan: ICICI Pru's group gratuity plan helps employers fund their
statutory gratuity obligation in a scientific manner. The plan can also be customized to
structure schemes that can provide benefits beyond the statutory obligations.

Group Superannuation Plan: ICICI Pru offers both defined contribution (DC) and
defined benefit (DB) superannuation schemes to optimise returns for the members of the
trust and rationalise the cost. Members have the option of choosing from various annuity
options or opting for a partial commutation of the annuity at the time of retirement.

Group Immediate Annuities: In addition to the annuities offered to existing


superannuation customers, we offer immediate annuities to superannuation funds not
managed by us.

Group Term Plan: ICICI Pru's flexible group term solution helps provide affordable
cover to members of a group. The cover could be uniform or based on designation/rank
or a multiple of salary. The benefit under the policy is paid to the beneficiary nominated
by the member on his/her death.

Flexible Rider Options

ICICI Pru Life offers flexible riders, which can be added to the basic policy at a marginal
cost, depending on the specific needs of the customer.

 Accident & disability benefit: If death occurs as the result of an accident during
the term of the policy, the beneficiary receives an additional amount equal to the
rider sum assured under the policy. If the death occurs while traveling in an
authorized mass transport vehicle, the beneficiary will be entitled to twice the sum
assured as additional benefit.
 Critical Illness Benefit: protects the insured against financial loss in the event of
9 specified critical illnesses. Benefits are payable to the insured for medical
expenses prior to death.
 Income Benefit: This rider pays the 10% of the sum assured to the nominee every
year, till maturity, in the event of the death of the life assured. It is available on
SmarKid and CashPlus.
 Waiver of Premium: In case of total and permanent disability due to an accident,
the future premiums continue to be paid by the company till the time of maturity.
This rider is available with LifeTime Super, LifeTime Super Pension and
CashPlus

RESEARCH METHODOLGY

To study the behavioral pattern of the investors for life insurance.

OBJECTIVES OF THE STUDY


Research Objectives:

1. To study the consumer preference for life insurance in general.


2. To better know how the consumers’ profile affects their investment decision in
insurance.
3. To understand the positioning of life insurance products.

RESEARCH DESIGN

Marketing research can be classified in one of three categories:


• Exploratory research
• Descriptive research
• Causal research

Descriptive research is more rigid then exploratory research and seeks to describe users
of a product, determine the proportion of the population that uses the product, or predict
the future demand for a product. As opposed to exploratory research, descriptive research
should define questions, people surveyed, and the method of analysis prior to beginning
data collection. In other words the, who, what, where, when, why and how aspects of the
research should be defined. Such preparation allows the opportunity to make any required
changes before the costly process of data collection has begun.

There are two basic types of descriptive research: longitudinal studies and cross sectional
studies. Longitudinal studies are time series analyses that make repeated measurements of
the same individuals, thus allowing one to monitor behavior such as brand switching.
However, longitudinal studies are not necessarily representative since many people may
refuse to participate because of the commitment required. Cross sectional studies sample
of the population to make measurements at a specific point of time. A special type of
cross sectional analysis is a cohort analysis, which tracks an aggregate of individuals who
experience the same event within the same time interval overtime. Cohort analyses are
useful for long term forecasting of product demand.

This research is Descriptive Research as this research is based on secondary data


collected

DATA COLLECTION

Researcher has two options in order to collect the data. He can gather secondary data,
primary data, or both.

PRIMARY DATA

Primary data are data that freshly gathered for a specific purpose or for a specific
research project.
The primary data is collected through the systematic market research survey. This survey
conducted through questionnaire, which have predefined specific objective questions.
The 150 respondents are contacted within the Surat city.

Again the informal interview is also taken for more in-depth to topic to the same
respondents.

SECONDARY DATA
Before going through the time and expenses of colleting primary data, one should check
for secondary data that previously may have been collected for other purposes but that
can be used in the immediate study. Secondary data may be internal to the firm, such as
sales invoices and warranty cards, or may be external to the firm such as published data
or commercial available data. The government census is a valuable source of secondary
data.

SECONDARY DATA SOURCES

The secondary data are data that were collected for another purpose and already exist
somewhere. The secondary I used in my research are from the following Books and sites:

The data collected from the following websites,


www.iciciprulife.com
www.irdaindia.org
Other sources of secondary data,
Various Brochers of ICICI Prudential Life Insurance.

LIMITATIONS

1. As this study is based on sample survey, therefore there might be chances of some
little variation from census survey.
2. Some of data are highly sensitive, therefore some of respondents might give
wrong information about their personal detail viz. Income
3. This survey is conducted within Patan city; therefore it might not be generalized
for other cities.
ANALYSIS AND INTERPRETATION

(1) How much amount of money do you invest annually?

10000-20000 20000-30000
30000-50000 more than 50000

Amount
Investing Respondent Percentage (%)
10000-20000 24 48
20000-30000 13 26
30000-50000 09 18
Above 500000 04 08
Total 50 100

Annualy Investment
8%
18%
48%

26% 10000-20000
20000-30000
30000-50000
Above 500000

Interpretation:

From the Above Graph we can say that 26% of the respondents invest between
20000-30000, where 48% respondents invest between 10000-20000. 18%
respondents between 30000-50000 and only 8% respondents invest above
50000.
(2) For what purpose do you invest?

For child education and marriage


For increase wealth
For financial securities
Planning for retirement
Long-term returns
Tax saving
Any other, please specify

Purpose Respondent Percentage


Child education 04 08%
Increase in wealth 14 28%
For financial securities 06 12%
Retirement 02 04%
Long term return 15 30%
Tax saving 09 18%
Total Respondents 50 100

Investment Purpose
8% Child education
18%
Increase in
wealth
28% For financial
securities
Retirement

30% Long term


return
4% 12% Tax saving
Interpretation:

From the Above Graph we can say that the purpose of most of respondents
was to invest for increasing wealth and long term return. The percentages
were 28% and 30 % respectively. 28% respondents invest for increase in
wealth. 04%, 30% and 12% respondents were investing for planning for
retirement, long term return and for financial securities respectively.

(3) Where do you invest your money?

Bank FD Mutual fund


Post office deposit Insurance
Shares Any other, please specify

Age group Respondent Percentage


Bank FD 13 26%
Mutual fund 08 16%
Post office deposite 07 14%
Insurance 12 24%
Shares 10 20%
Total 50 100

Where to Invest
Bank FD
20%
26%
Mutual fund

Post office
deposite
Insurance
24%
16%
Shares
14%

Interpretation:
from the above graph we can say that out of 50 respondents 13 respondents invest
in F.D. 07 invests in post office deposit. 12 in insurance and 08 in mutual fund. and
10 invest in Shares.

(4) Name the insurance company that you are aware of?

LIC
ICICI Prudential
Bajaj- Alliance
TATA-AIG
Reliance life
Birla sun life
HDFC standard life

Company Respondent Percentage


Bajaj Allianz Life Insurance 38 76.00%
ICICI Prudential life Insurance 42 84.00%
TATA- AIG 34 68.67%
Reliance Life Insurance 26 52.00%
LIC 50 100.00%

Bajaj Allianz Life


76.00% Insurance
100.00%
ICICI Prudential
life Insurance
TATA- AIG

Reliance Life
84.00% Insurance
52.00%
LIC

68.67%

Interpretation:
From the above graph we can say that LIC is the having the 100% awareness where
42 respondents were aware of ICICpru. 38 respondents were aware of Baja-alliance
and 34 were aware of TATA- AIG, where 26 were aware of reliance life.

(5) Have you invested in any life insurance policy?

Yes No

Policy holder Respondent Percentage (%)


Yes 35 70
No 15 30
Total 50 100

Invest in insurance

30%

Yes
No

70%

Interpretation:

From the above graph we can say that 70% from the respondents were having the
insurance policy where 30% respondents had not insurance policy.
If No Go to Q. no. 08 Otherwise continue with next question.

06) Which policy do you hold?

Investment Only
Insurance Only
Both

Gender Respondent Percentage (%)


Investment only 11 31
Insurance only 13 38
Both 11 31
Total 35 100

which policy

31% 31%

Investment only
Insurance only
Both

38%

Interpretation:
From the above graph we can say that 31 % of them having Policy for both purpose
where 38% of the respondents were used to invest for insurance cover only and
31% were used to invest for investment purpose.
(7) In you family, who all posses an insurance cover?

My self
Spouse
Children
Parents
Grand children

Gender Respondent
My self 32
Spouse 30
Children 17
Parents 28
Grand Children 04

who posses insurance


4%

29%
25% My self
Spouse
Children
Parents
Grand Children
15%
27%

Interpretation:

From the above graph we can say that 35 respondents have the policy for their
selves as well as their children, spouse, parents and grandchildren.
(08) At present are you interested in investing into life insurance policy?

Yes No

Gender Respondent Percentage (%)


Yes 41 82
No 09 18
Total 50 100

Interested in Investing in Life Insurance

18%

Yes
No

82%

Interpretation:

From the above graph we can say that 82% right who wants to invest in Life
insurance. And 18% were not ready to invest right now.
(09) Choose the insurance policy in which you would like to invest?

Investment only
Insurance only
Both

Gender Respondent Percentage (%)


Investment only 09 18
Insurance only 11 23
Both 29 59
Total 50 100

Investment pattern

18%

Investment only
Insurance Only

23% Both
59%

Interpretation:

From the above graph we can say that those who wants to invest most of them
59% wants invest for both the purpose Investment as well as insurance. Where
23% wants to invest for insurance purpose only and 18% wants to invest for
Investment purpose only.
Personal Information :-

(1) Gender:
Male Female

Gender Respondent Percentage (%)


Male 45 10
Female 05 90
Total 50 100

Gender of respondent

10%

Male
Female
90%

Interpretation:

Form the above graph we can say that 90 % respondents are Male and 10%
respondents are Female.
(2) Age Group:

Below 25 25-35 35-45 45-55 Above 55

Age group Respondent Percentage (%)


Below 25 01 02
25-35 35 68
35-45 10 20
45-55 04 08
Above 55 01 02
Total 50 100

Age group of Respondent

8% 2%2%
Below 25
20% 25-35
35-45
45-55
68%
Above 55

Interpretation:

Form the above graph we can say that 68 % respondents are between the age of 25-35
and 20% respondents are between 35-45. There were 02% respondents below 25,
08% between 45-55 and only 2% respondents were above 55 in my survey.
(3) Marital Status: Married Unmarried

Marital Status Respondent Percentage (%)


Married 38 76
Unmarried 12 24
Total 50 100

Gender of Respondent

24%

Married
Unmarried

76%

Interpretation:

Form the above graph we can see that 76 % respondents are married and 24 %
respondents are unmarried.
FINDINGS

 In the survey it is found that among the private player


ICICI prudential is doing well in the insurance sector.
People are Interested in investing in ICICIpru than other
private insurance company.

 Most of the respondents having the income between 60000-


150000 and they usually investing in the different policy.

 89 of the respondents have already invested indifferent plan


of insurance.

 123 of the respondents are really interested in investing in


Insurance.

 People Who have invested in Insurance most of them are


having the plan which includes the purpose of Investment
as well as Insurance cover

 Most of the respondents have the policy for their selves as


well as their family members.

 The purpose of investment of most of the respondent was


for the Child education and the Tax benefit.

 Although there are some respondents who invest for


increase in wealth and financial security ad retirement
solution.

 Most of the respondents have their investment in the Bank


FD, and post office deposit.

 Some of the them also investing in mutual funds and


insurance also.

 In the survey it is found that most of the respondents were


having the services as their occupation.
SUGGESTIONS
 People still doubt the private companies whether they
provide return or not and their money will safe or not.

 Company should improve the quality f the adviser so


that they can provide full information to the customers.

 People still investing in the bank FD and post. To


capture that market company should come with the
product, which is more safe and having good return
capacity.

 Company should also give more focus on professionals


and the businessman who can be the more profitable for
the company.
CONCLUSION
 After survey its known that people want to invest in
the ULIPs than other policy. the reason is that it
gives reasonable return with lore safety than other
plan of Private insurance players.

 People should be given more knowledge about the


benefit of the insurance.

 As the trust on private player is less the company


should work on the getting the full trust of all the
people.

 Because of insecurity in private companies people


invest in the bank FD and Post office deposit.
BIBLIOGRAPHY

WEBSITES:

 www.irdaindia.com
 www.icicibank.com
 www.iciciprulife.com
 www.prudential.co.uk

BOOKS REFFERED:

 Business Research Methodology


Author : Donald Cooper & Pamela Schindler
Publisher : TATA - Mcgraw hill
Year of Publication : 2003

 Marketing Management
Author : Philip kotler
Publisher : prentice hall
Year of Publication : 2006