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Summer Training Project

“Study of Finance Channel Available For Life Insurance”

Training Period
(May 15th, 2008 to July 15th, 2008)

Submitted By
BATCH: (jan. 2008-2010)


The Harder You Work…… The Luckier You Get.

It was a privilege for us to work in a reputed organization- ICICI
PRUDENTIAL Life Insurance Ltd. This has given us an opportunity to work
in a truly professional environment where team work score over individual
effort, where there is a helpful atmosphere.
A well planned, properly executed and evaluated training helps a
lot in inoculating good work culture. It provides linkage between student and
industry in order to develop the awareness of individual approach to problem
solving based on the broad understanding of plant machinery, process and
mode of operation of individual organization. The project on “Study of
Marketing Channel Available for Life Insurance” has been made to facilitate
effective understanding about the marketing aspects.
The project training has provided me an opportunity to gain
practical experience, which has helped me to increase my sphere of
knowledge to a greater extent. I have tried to summarize all our experience
and knowledge acquired up till now, in this report. This project is a keen
effort to obtain the expected results and fulfill all the information required.
At the end annexure and bibliography are given for effective
I am grateful to ICICI PRUDENTIAL Life Insurance for
providing required support.
Thank you for your interest in my project report.



I, XXXXXXXX , student of the Delhi Business School, jan. 2007-08 Batch
hereby declare that the project titled “Study of Finance Channel Available for
Life Insurance” is a bonafide work and is neither submitted to Delhi Business
School, new Delhi at any point of time nor to any other university/Institution
for fulfillment of the requirement of the course of study.


3 Research Methodology 1.1 An Overview 1.3 Insurance Sector Reforms 3.4 Organization development 2.1 Life Insurance Facts 3. Table of contents: Acknowledgement 5 Executive Summary 6 Chapter: 1 Introduction 7-11 1.1 About ICICI 2.2 A Brief History of Insurance Sector 3.2 Objectives of the study 1.1 Distribution Channel 4.4 Role of Life Insurance 3.2 About PRUDENTIAL 2.3 Life Advisor Restrictions .4 Limitation of the Study Chapter: 2 Company profile 11-18 2.5 Performance highlights Chapter: 3 Industry Profile 19-29 3.3 About ICICI PRUDENTIAL Life Insurance 2.2 Life Advisor Profile 4.5 Major Players of Life Insurance Chapter: 4 Conceptual Frameworks 30-34 4.

Chapter: 5 Sectional Works Done in the Company 35-42 5.4 Suggestions Chapter: 6 Recommendations 43-46 Chapter: 7 Conclusions 47-49 Chapter: 8 Appendixes 50-54 8.1Glossary 8.2 Work Done at ICICI PRUDENTIAL Life Insurance 5.3 Findings 5.2Bibliography .1 Products Offered 5.

XXXXXXX . Although I have expressed our gratitude and heartfelt thanks to every person. but there might be a few. I acknowledge with deep gratitude and respect to the placement In-charge Mr. Our sincere gratitude to training in-charge Mr. Before we got things I would like to add a few heartfelt words for the people who were part of this project in numerous ways. who’d been left out. useful suggestion. Acknowledgement When we do anything. who helped me in reaching at this stage. I would like to thank all of them for being a constant motivation and inspiration to me. critical evaluation and unending support which helped us accomplishes the project.Ravi sharma for providing me support for my project. Mukul bharati for his valuable guidance. we always want to thank all those people who have left an impression on our lives and inspired us to greatness. encouragement.

when we have to live today? Insurance is a tool. or property damage. Insurance is a legal contract that protects people from the financial costs that result from Loss of life. . Preparing for the uncertainties of life is what Insurance is all about. loss of health. lawsuits. for instance. from a variety of insurance organizations. some pleasant and some not so pleasant. Insurance provides a means for individuals and societies to cope with some of the risks faced in everyday life. Almost everyone living in modern. laws in most states require people who own a car to buy insurance before driving it on public roads. industrialized countries buys insurance. Why waste precious moments contemplating tomorrow. Business partners take out life insurance on each other to make sure that business will succeed even if one of the partners dies. Lenders require anyone who finances the purchase of a home or car with borrowed money to insure that property. a solution for delegating the worries concerning tomorrow onto a trustworthy institution so that you can start living today. In other words. called policies. Our families and we have to live with these uncertainties. People purchase contracts of insurance. Executive summary Life is full of surprises.

The primary purpose of life insurance is therefore protection of the family in the event of death. Deregulation in India has resulted in increased number of players in the market and hence the competition. retirement. Objectives of the study: The main purpose of this project is to identify the trends. In the life insurance market. London (26%). from FY 2000 to 2006 it demonstrated a substantial premium income growth. one of the fastest growing companies in India. This guarantees that our dependants will be able to continue living without financial hardships even in case of our demise. . This competition has brought about a change in the existing distribution channels. the market offers insurance plans that not just cover the life and but at the same time grow wealth too. Today. (74%) and Old Mutual plc. Today. insurance is also seen as a tool to plan effectively for the future years. progress and performance of marketing channel in insurance industry. in effect what we are doing is insuring our earning capacity. ICICI PRUDENTIAL Life Insurance was established in 2000 as a joint venture between ICICI Bank Ltd. ICICI PRUDENTIAL Life Insurance. The new types of distribution channels are wider and are expected to be more technology oriented for the urban population in future. There also exists a vast potential for new types of companies coming into the market that support the existing structure of the industry such as agency management systems and the brokerage firms. and for children's future needs. When we insure our life.

 A level playing field at all stages of development in the sector for all the players.  A more rationale approach to the investment criteria.  Trained professionals to build and sell the product. And last but not the least patience amongst the players and consumers to wait for the pot of gold at the end of the rainbow.  A well-established distribution network. CHAPTER: 1 INTRODUCTION .  A stringent accounting practice to prevent failures amongst the insurers.Recommendations: The following are the recommendations as per my study:  A change in the attitude of the population  An open and transparent environment created under the IRDA.

they're all built into the working of the Universe. insurance is a unique investment avenue that delivers sound returns in addition to protection.  Spread of financial services in rural areas and amongst socially less privileged. theft. illness.accident. waiting to happen. natural disaster . An accident or disability can be devastating.4 Limitation of The Study An Overview: Risks and uncertainties are part of life's great adventure -.1 An Overview 1. The following are the contribution made by insurance industry to Indian economy:  Life Insurance is the only sector which garners long term savings. Insurance also provides a safeguard in the case of accidents or a drop in income after retirement.2 Objectives of The Study 1. and an insurance policy can lend timely support to the family in such times. For that. 1. .3 Research Methodology 1.

(Mark to Market basis around 80. The following are the primary objective of study:  To find prospects for appointing them as insurance advisors.  Provide Long term funds for infrastructure. Employees in insurance sector as on 31st March. Many agents depend on insurance for their livelihood  Industry also contributes in economic development through investments in capital market.  To target the groups of people who can do well as insurance advisors and be beneficial to the company in bringing prospective clients.  Employment generation i. 40. The primary motive of any business undertaking is to earn profit.  Strong positive correlation between development of capital markets and insurance/ pension sector. .e. Insurance industry able to satisfy the object of investor and stakeholder via providing excellent opportunities. Objective of the Study: The main objective of this project is to identify the progress and performance of marketing channel in insurance industry and also gain first hand experience of how an organization works and to get familiar with the working and structure of the organization. Life Insurance industry is under the phase of infancy after 50 years of monopoly and also face healthy competition from within and other sectors of financial market. Because. Insurance industry needs environmental support till it reaches a comfort zone. 2005 is around 2 lakhs. Life insurance industry provides increased employment opportunities.000 crores).  To know the type of people requiring such job of work.000 crore. Present level of investments is over Rs.

PERIOD OF STUDY: . marketing aspects assume a significant role in determining the growth of industries. technology. Out of these.  To tell prospects about the flagship policies of the company.  To find out the working process of an insurance agent  To find out how ICICI recruits the agents.  To find out databases from different sources for random calling. Research Methodology: THE SCOPE OF THE RESEARCH: Development of industries depends on several factors such as financial.  To know the origin and history of life insurance companies  To gain experience in different environment with different people  At the same time to show the integration of the various business processes. quality of the services and social responsibility.  To understand the functioning of an insurance company. where the company differentiates. All of the organization operation virtually affects its need for cash that create aims to explore this product.

when and how. Thus the major purpose of descriptive research is the description of the state of affairs. The period of the study for this project covers two months i. But there is possibility for some discrepancies to come in between due to following limitations:  Respondents may give their biased opinion. TYPES OF THE RESEARCH: It is a descriptive research and the main objective of descriptive research is to learn about who. It includes study and fact finding inquiries of different kinds. errors so as to ensure authenticity and accuracy. Further. as they know the identity of Management Trainee. what. . as it exits at present. FRAMEWORK OF ANALYSIS: The study has been undertaken to examine and understand the marketing aspect for a business playing a crucial role in the growth.e. The framework of study concern with structure of marketing channel. two month period is a reasonable period to study the performance of target person and to gain knowledge with respect of insurance industry. May. 15th 2007 to July. 9th 2008.  It was difficult to get appointment from the person whom I know because of their busy schedule. Limitation of the Study: Throughout the study utmost care has been taken to avoid biases.

it required a dedicated labor in term of both time and effort. Since the project had to be completed within eight weeks.  Last but not the least and the most deciding factor paucity of time.  The study is not free from communication error.  Since the study involved a through analysis of the insurance market and relative study of various players offering the similar products and that of similar. it was too short a time to convert the prospective advisors. which may not give a true picture. CHAPTER: 2 COMPANY PROFILE . the study had to be very limited.  Assumption is made that views and suggestion given by the respondent are his factual knowledge about information.  My study is based on responses of client and guidance of corporation only. Since the curriculum did not permit more time.

2 About PRUDENTIAL 2. In the 1990s. ICICI's shareholding in ICICI Bank was reduced to 46% through a public offering of shares in India in fiscal 1998. ICICI transformed its business from a development financial institution offering only project finance to a diversified financial services group offering a wide variety of products and services. both directly and through a number of subsidiaries and affiliates like ICICI Bank.1 About ICICI 2. 2. ICICI Bank's acquisition of Bank of Madura Limited in an all-stock amalgamation in fiscal 2001. the Government of India and representatives of Indian industry. ICICI become the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE.5 Performance Highlights About ICICI ICICI Bank was originally promoted in 1994 by ICICI Limited. The principal objective was to create a development financial institution for providing medium-term and long-term project financing to Indian businesses.4 Organization Development 2. an equity offering in the form of ADRs listed on the NYSE in fiscal 2000. . an Indian financial institution.3 About ICICI PRUDENTIAL Life Insurance 2. ICICI was formed in 1955 at the initiative of the World Bank. and secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal 2002. In 1999. and was its wholly-owned subsidiary.

The merger was approved by shareholders of ICICI and ICICI Bank in January 2002. seamless access to ICICI's strong corporate relationships built up over five decades. have been integrated in a single entity. ICICI Personal Financial Services Limited and ICICI Capital Services Limited. particularly fee-based services. the managements of ICICI and ICICI Bank formed the view that the merger of ICICI with ICICI Bank would be the optimal strategic alternative for both entities. and would create the optimal legal structure for the ICICI group's universal banking strategy. and the move towards universal banking. and access to the vast talent pool of ICICI and its subsidiaries. The merger would enhance value for ICICI shareholders through the merged entity's access to low-cost deposits. the ICICI group's financing and banking operations. Consequent to the merger. greater opportunities for earning fee-based income and the ability to participate in the payments system and provide transaction-banking services. by the High Court of Gujarat at Ahmedabad in March 2002. . entry into new business segments. with ICICI Bank. both wholesale and retail. higher market share in various business segments. After consideration of various corporate structuring alternatives in the context of the emerging competitive scenario in the Indian banking industry. In October 2001. and by the High Court of Judicature at Mumbai and the Reserve Bank of India in April 2002. the Boards of Directors of ICICI and ICICI Bank approved the merger of ICICI and two of its wholly-owned retail finance subsidiaries. The merger would enhance value for ICICI Bank shareholders through a large capital base and scale of operations.

over 261.033 of India's foremost financial services companies-and Prudential plc . with ICICI Bank holding a stake of 74% and Prudential plc holding 26%. Total capital infusion stands at Rs. ICICI Prudential has been voted as India's Most Trusted Private Life Insurer. ICICI Prudential was the first life insurer in India to receive a National Insurer Financial Strength rating of AAA (Ind) from Fitch ratings. 37. We began our operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). For three years in a row. Today. and 20 bancassurance partners. by The Economic Times .000 advisors. we continue to tirelessly uphold our commitment to deliver world-class financial solutions to customers all over India. As we grow our distribution.About PRUDENTIAL: ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank . our nation-wide team comprises of over 955 branches in addition to 1. . product range and customer base.a leading international financial services group headquartered in the United Kingdom.72 billion.AC Nielsen ORG Marg survey of 'Most Trusted Brands'.

be it product development. the sales process or servicing. and also partners with leading banks. but it's equally important to ensure that our customers can access them easily and quickly. Having the right products is the first step. or Health insurance that arms you with the funds you might need to recover from a dreaded disease.About ICICI PRUDENTIAL Life Insurance company Ltd: The ICICI Prudential edge comes from our commitment to our customers. It is this research that helps us develop Education plans that offer the ideal way to truly guarantee your child's education. distribution. . 1. Retirement solutions that are a hedge against inflation and yet promise a fixed income after you retire. To this end. ICICI Prudential has an advisor base across the length and breadth of the country. in all that we do . Here's a peek into what makes us leaders. corporate agents and brokers to distribute our products . 2. Our products have been developed after a clear and thorough understanding of customers' needs.

Entrusted with helping our customers meet their long-term goals. we ensure equitable costing of risks. . our 28. 4. so that they can deliver on our promise to cover you. every day in a multitude of ways. Last but definitely not the least. and thereby ensure a smooth and hassle-free claims process. With clear guidelines in place. 5. at every step in life. We believe this keeps them engaged and enthusiastic. Robust risk management and underwriting practices form the core of our business.000 plus strong team is given the opportunity to learn and grow.3. we adopt an investment philosophy that aims to achieve risk adjusted returns over the long-term.

3307 *-- Balancer (Balanced) 25.42 (Balanced) Fund # Pension Protector 14.27 .51 Fund * Pension Maximiser 48.79 Fund *-- Maximiser (Growth) 48.7296 (Income) Fund # Group Balanced Fund 17.56 (Growth) Fund # Pension Balancer 24.Organization development: Unit Values of different Funds as on 09-07-2008 Unit Value Plan (Rs./unit) Protector (Income) Fund 16.

2273 Fund * ^-- Balancer (Balanced) 16.16 Term) Fund # ~ $$ Pension Maximiser 27.42 Fund II ^ Preserver (Short Tem) 13.5519 fund Group Growth Fund 22.0289 Short Term Debt Fund Maximiser (Growth) 26.54 (Growth) Fund II ~ $$ .277 II ^ Pension Preserver (Short 13.Group Debt Fund 13.27 Group Capital Guarantee 13.89 Fund II ^ Protector (Income) Fund 12.4649 Group Short Term debt 13.

2452 Investshield Gold .51 ISPP Maximiser (Growth) 12.26 Fund III ^^ Balancer (Balanced) 11.5344 III ^^ Preserver (Short Tem) 11.46 (Balanced) Fund II ~ $$ Investshield Cash .ISLP 14.3258 (Income) Fund II ~ $$ Pension Balancer 17.ISCH 12.9588 Fund III ^^ .Pension Protector 12.92 Fund III ^^ Protector (Income) Fund 11.46 Investshield Pension - 14.

74 Flexi Growth II ^ 10.903 Secure Plus Fund 12.Group Capital Guarantee 11.5006 Fund Flexi Growth-. 10.84 Flexi Growth III ^^ 10.37 .27 Growth Fund Cash Plus Fund 12.9838 Debt Fund ** Group Capital Guarantee 12.1 Balanced Fund ## Group Capital Guarantee 11.71 Pension Flexi Growth # 10.75 Secure Plus Pension 12.43 Balanced Fund ** New Invest Shield 12.

2032 Short Term Debt Fund II Group Capital Guarantee 11.Pension Flexi Growth II $ 10.1401 Debt Fund II Group Capital Guarantee 11.9 Flexi Balanced III ^^ 10.32 Growth Fund II .08 Balanced Fund II Group Capital Guarantee 10.58 Pension Flexi Balanced # 11. 10.18 Pension Flexi Balanced II 11.47 $~ Flexi Balanced-.65 Flexi Balanced II ^ 10.07 $$ ~ Group Capital Guarantee 11.

2 Multiplier Fund III-.5698 IV $$$ Preserver (Short Tem) 10.17 Fund IV $$$ Multiplier Fund-.13 Multiplier Fund IV $$$ 8. 7.15 .42 Fund IV $$$ Balancer (Balanced) 10.Flexi Growth IV $$$ 9.696 Fund IV $$$ Maximiser (Growth) 9.41 Multiplier Fund II ^ 8.^^ 8.24 Flexi Balanced IV $$$ 9.72 Protector (Income) Fund 10.

9.37 Pension RICH Fund II ~ 9.51 RICH Fund IV $$$ 9.43 RICH Fund II ^ 9.Pension Multiplier Fund-- 8.26 # Pension Multiplier Fund 8.2172 Fund .37 $$ Group Leave Encashment Balance 9.48 Pension RICH Fund # 9.26 II ~ RICH Fund -.94 Fund Group Leave Encashment Short Term 10.48 RICH Fund III ^^ 9.

Group Leave Encashment Income 10.1398 Fund * Unit values are applicable to LifeLink LifeTime LifeTime Super SmartKid RP SmartKid SP ^ Unit values are applicable to Golden Years LifeLink II LifeTime II LifeTime Plus PremierLife Gold PremierLife SmartKid RP II SmartKid SP II Smart Kid New SmartKid New Unit Linked Unit Linked Regular Premium Single Premium # Unit values are applicable to LifeLink Pension LifeTime Pension LifeStage Pension ~ Unit values are applicable to .

LifeLink Pension LifeLink Super II Pension LifeTime LifeTime Super Pension II Pension ** Unit values are applicable to Invest Shield Gold *** Unit values are applicable to InvestShield CashBak ^^ Unit values applicable to LifeLink Super ## Unit values applicable to InvestShield Life New $$ Unit values applicable to Premier Life Pension $$$ Unit values applicable to Life Stage RP -.Unit values applicable to .

6.684 crores.72 billion (as on March. 2008 .500 crore as on May 31. the company garnered Retail New Business Weighted premium of Rs. The company has assets held over Rs. Life Time Gold Performance Highlights: ICICI Prudential Life's capital stands at Rs. registering a growth of 68% over the last year and has underwritten nearly 3 million retail policies during the period. 2008. 37. For the year ended March 31. 29. 2008) with ICICI Bank and Prudential plc holding 74% and 26% stake respectively.


1 Life Insurance Facts 3.2 A Brief History of Insurance Sector 3.3 Insurance Sector Reforms 3.5 Major Players of Life Insurance .4 Role of Life Insurance 3. CHAPTER: 3 INDUSTRY PROFILE 3.

Insurance is also seen as a tool to plan effectively for future years. has paid off their mortgage and no longer has major financial obligations. your retirement. It provides dependents with the necessary funds to settle financial obligations and to cover the loss of income created by the insured’s death. What Is It Intended To Do? Life insurance offers security in the event of the insured’s death. for immediate financial needs. Why is Life Insurance Necessary? People carry life insurance for many reasons. educational costs for young children. The primary purpose of life insurance is therefore protection of the family in the event of death. An individual may choose to no longer carry their insurance or to reduce their coverage amount to a level just . for child care. It is an insurance company's promise to pay a beneficiary a specific amount of money when an insured dies in exchange for timely payment of premiums. Life insurance offers financial protection to survivors. Among the most common are to pay off a mortgage. to provide for educational protect a mortgage or an estate. Today. and medical or funeral costs. and for your children's future needs. credit cards…). the market offers insurance plans that not just cover your life and but at the same time grow your wealth too.Life Insurance Facts: What Is Life Insurance? Life insurance provides protection against financial loss resulting from death. etc. for beneficiaries to be able to maintain their current standard of living. then their life insurance needs will be lower than when they were younger. or personal debts (car loan. How Might Life Insurance Needs Change Over Time? If an individual has finished raising their family. for retirement or for charity. Life insurance policies are usually purchased with a specific intention in mind .

and therefore. theft. When an individual buys life insurance. the insured pays the insurance company for their insurance policy. Since younger people are less likely to die than older people.sufficient to ensure that their survivors have enough money to pay final expenses (burial. they are grouped together with other people who are similar in age. insurance premiums are generally lower at younger ages. This is a called designating a beneficiary. the more money will be needed to pay death claims. Each year. The insured also informs the insurance company who should get the insurance money if they (the insured) die. fire. and health. If the insured dies while their policy is active. What Is An Actuary? An actuary is a person who is professionally trained in the technical aspects of insurance. How much does life insurance cost? . auto accidents. Insurance provides a means of transferring the financial consequences of certain risks from the individual to an insurance company. dividends. This money is called a premium. and proper policy reserves. while many more people pay them premiums. Actuaries assist in estimating the cost of implementing new benefits or benefit enhancements and also conduct statistical and financial studies. Insurance companies can do this because only a small number of people die each year. more money will have to be collected as premiums. Actuaries calculate how many people in each group are likely to die in a period of time. the insurance company will pay the beneficiaries the insurance money. How Does Life Insurance Work? All aspects of life involve risk. particularly in the mathematics of insurance. The more deaths there are in a group. such as calculating premiums.. medical. e. sex. The “risk” of death is spread out among many people in order to prevent a financial loss to the beneficiaries of the few who will die. estate taxes…). injury.g.

Bombay Mutual Assurance Society. The Insurance Act was passed in 1912. It was during the swadeshi movement in the early 20th century that insurance witnessed a big boom in India with several more companies being set up. is derived from the Rig Veda. business in India are: 1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business. A Brief History of Insurance Sector: Insurance in India can be traced back to the Vedas. 1928: The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. The amount of premiums payable depends upon the type of policy. followed by a detailed and amended Insurance Act of 1938 that looked into investments.In order to buy a life insurance policy. the first Indian life assurance society. Bharat and Empire of India were also set up in the 1870-90s. Some of the important milestones in the life ins. . was formed in 1870. expenditure and management of these companies' funds. The term suggests that a form of "community insurance" was prevalent around 1000 BC and practised by the Aryans. term of policy contract. protect widows and children. Other companies like Oriental. the name of Life Insurance Corporation of India's corporate headquarters. in Calcutta. For instance. you must pay premiums to the life insurance company. yogakshema. sum assured and your age. Burial societies of the kind found in ancient Rome were formed in the Buddhist period to help families build houses. The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Co.

.. 5 crore from the Government of India. and the United India Insurance Company Ltd. set up. LIC Act. the National Insurance Company Ltd. the first company to transact all classes of general insurance business. LIC formed by an Act of Parliament. 1956: 245 Indian and foreign insurers and provident societies taken over by the central government and nationalized. 107 insurers amalgamated and grouped into four companies’ viz. 1957: General Insurance Council. GIC incorporated as a company. the Oriental Insurance Company Ltd. 1956. 1968: The Insurance Act amended to regulate investments and set minimum solvency margins and the Tariff Advisory Committee set up. can trace its roots to the Triton Insurance Company Ltd. 1972 nationalized the general insurance business in India with effect from 1st January 1973. frames a code of conduct for ensuring fair conduct and sound business practices. the first general insurance company established in the year 1850 in Calcutta by the British.. The General insurance business in India. with a capital contribution of Rs. a wing of the Insurance Association of India. on the other hand. 1972: The General Insurance Business (Nationalization) Act. viz.1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. the New India Assurance Company Ltd. Some of the important milestones in the general insurance business in India are: 1907: The Indian Mercantile Insurance Ltd. .

was formed to evaluate the Indian insurance industry and recommend its future direction. Malhotra. For years thereafter. has extensive powers to oversee the insurance business and regulate in a manner that will safeguard the interests of the insured. It was only after seven years of deliberation and debate . an autonomous insurance regulator set up in 2000. N. headed by former Finance Secretary and RBI Governor R. insurance remained a monopoly of the public sector. Insurance Sector Reforms: In 1993. The Insurance Regulatory & Development Authority. In 1994.that the sector was finally opened up to private players in 2001.after the RN Malhotra Committee report of 1994 became the first serious document calling for the re-opening up of the insurance sector to private players -. The reforms were aimed at “creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognizing that insurance is an important part of the overall financial system where it was necessary to address the need for similar reforms…”. The Malhotra committee was set up with the objective of complementing the reforms initiated in the financial sector. the committee submitted the report and some of the key recommendation included: i) Structure  Government stake in the insurance Companies to be brought down to 50% . Malhotra Committee.

 Government should take over the holdings of GIC and its subsidiaries so that these subsidiaries can act as independent corporations  All the insurance companies should be given greater freedom to operate ii) Competition  Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the industry  No Company should deal in both Life and General Insurance through a single entity  Foreign companies may be allowed to enter the industry in collaboration with the domestic companies  Postal Life Insurance should be allowed to operate in the rural market  Only one State Level Life Insurance Company should be allowed to operate in each state iii) Regulatory Body  The Insurance Act should be changed  An Insurance Regulatory body should be set up  Controller of Insurance (Currently a part from the Finance Ministry) should be made independent iv) Investments  Mandatory Investments of LIC Life Fund in government securities to be reduced from 75% to 50%  GIC and its subsidiaries are not to hold more than 5% in any company (There current holdings to be brought down to this level over a period of time) v) Customer Service  LIC should pay interest on delays in payments beyond 30 days .

Since being set up as an independent statutory . The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDA’s online service for issue and renewal of licenses to agents. which are expected to be introduced by early next year.100 crores. The Insurance Regulatory and Development Authority Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. the committee felt the need to exercise caution as any failure on the part of new players could ruin the public confidence in the industry. The committee felt the need to provide greater autonomy to insurance companies in order to improve their performance and enable them to act as independent companies with economic motives.  Insurance companies must be encouraged to set up unit linked pension plans  Computerization of operations and updating of technology to be carried out in the insurance industry The committee emphasized that in order to improve the customer services and increase the coverage of the insurance industry should be opened up to competition. But at the same time. Hence. it had proposed setting up an independent regulatory body. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. it was decided to allow competition in a limited way by stipulating the minimum capital requirement of Rs. The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products. For this purpose.

workers in the unorganized and informal economically back.5 mn would be imposed the first time. and this is besides the added incentives offered by insurers. In . something that is missing in non-insurance products. The percentage may be specified by the IRDA and such regulations will apply to all insurers operating in the country. the focus shifted to the following: * The Insurance Regulatory and Development Authority (IRDA) should give priority to health insurance while issuing certificates of registration. You cannot compare an insurance product with other investment schemes for the simple reason that it offers financial protection from risks. * In case the insurers fail to meet the social sector obligation a fine of Rs. Insurance products yield more compared to regular investment options. Role of Life Insurance: ► Role 1: Life insurance as "Investment": Insurance is an attractive option for investment.2.body the IRDA has put in a framework of globally compatible regulations. * Insurers will be expected to undertake a certain percentage of business in the rural or social sector and provide policies to persons residing in rural areas. many are not aware of its advantages as an investment option as well. While most people recognize the risk hedging and tax saving potential of insurance. In the private sector 12 life insurance and 6 general insurance companies have been registered. With the Insurance Regulatory and Development Act. Subsequent failures would result in cancellation of licences. * Policyholders' funds will be invested in the social sector and infrastructure.

Thus insurance is a unique investment avenue that delivers sound returns in addition to protection. A loss claim is paid out of the total premium collected by the insurance companies. unlike non-life help outlast life's unpredictable protection. you get maturity benefits on survival at the end of the term. you must accept that a part of the total amount invested in life insurance goes towards providing for the risk cover. insurance firms collect contributions from many people who face the same risk. ► Role 2: Life insurance as "Risk cover”: First and foremost. and an insurance policy can lend timely support to the family in such times. Thus. while the rest is used for savings. the amount invested as premium in the policy will come back to you with added returns. Designed to safeguard against losses suffered on account of any unforeseen event. before comparing with other schemes. It .fact. you buy peace of mind and are prepared to face any financial demand that would hit the family in case of an untimely demise. In the unfortunate event of death within the tenure of the policy. who act as trustees to the monies. An accident or disability can be devastating. Insurance also provides a safeguard in the case of accidents or a drop in income after retirement. In other words. To provide such protection. By buying life insurance. to be more precise . In life insurance. insurance provides you with that unique sense of security that no other form of investment provides. insurance is about risk cover and protection . the premium you pay for an insurance policy is an investment against risk. if you take a life insurance policy for 20 years and survive the term. the family of the deceased will receive the sum assured.

000 on payment of yearly premium of Rs 60. many of these can be further customized to fit individual/group specific needs.they're all built into the working of the Universe. you can buy anything upwards of Rs 10 lakh in sum assured. waiting to happen.also comes as a great help when you retire. illness. it's worth buying some extra sleep. (depending upon the age of the insured and term of the policy) This means that you get a Rs 12. Risks and uncertainties are part of life's great adventure -. Major Players of Life Insurance: STRUCTURE OF INSURANCE INDUSTRY Historical Perspective I ). The rebate is deductible from tax payable by the individual or a Hindu Undivided Family. Considering the amount you have to pay now. in case no untoward incident happens during the term of the policy. Under Section 88 of Income Tax Act 1961. theft.000 a year. an individual is entitled to a rebate of 20 per cent on the annual premium payable on his/her life and life of his/her children or adult children. Further.000. natural disaster . This rebate is can be availed upto a maximum of Rs 12. With the entry of private sector players in insurance. The rebate is deductible from the tax payable by an individual or a Hindu Undivided Family.accident. Prior to 1956 242 Companies operating . ► Role 3: Life insurance as "Tax planning" Insurance serves as an excellent tax saving mechanism too. By paying Rs 60. The Government of India has offered tax incentives to life insurance products in order to facilitate the flow of funds into productive assets.000 tax benefit. you have a wide range of products and services to choose from.

a. (AMP SANMAR) l. ING Vysya Life Insurance Co. b. Postal Life Insurance 2. Ltd. Kotak Mahindra old mutual Life Insurance Co. Ltd. Ltd. (TATA AIG) k. (ING VYSYA) g. (MNYL) h. and Axa Bharti Enterprises. c. (BSLI) d. (HDFC STD LIFE) e. (METLIFE) i. 1956 . (AVIVA) m. Ltd. HDFC Standard Life Insurance Co. Pvt. Ltd. Aviva Life Insurance Co. LIC – Fully owned by Government b. Pvt. MetLife India Insurance Co. TATA AIG Life Insurance Co. (SBI LIFE) j.2001 Nationalization – LIC monopoly Player – Government control III) 2001 -. Opened up sector PRESENT STRUCTURE OF INSURANCE INDUSTRY 1. Max New York Life Insurance Co. Sahara India Life Insurance Co. Ltd. Ltd. Reliance Life Insurance. ICICI Prudential Life Insurance Co. (SAHARA LIFE) 3. Other likely players – PNB Life Insurance. Birla Sun Life Insurance Co. SBI Life Insurance Co. . Bajaj Allianz Life Insurance Co. Ltd. Ltd. Ltd. Private players - a. f. Ltd. II ). AMP Sanmar Assurance Co. Ltd. Ltd.

CHAPTER: 4 CONCEPTUAL FRAMEWORK 4.2 Life Advisor Profile 4.3 Life Advisor Restrictions .1 Distribution Channel 4.

Several obvious factors that impact on a channel’s adoption are consumer attitudes and preferences. Consumers still do not view even personal lines insurance products to be commodity products. and agent-led channels. it is helpful to examine some of the existing literature on innovation adoption and insurance distribution channels. company led channels. Although there have been some changes in the areas of commissions and production requirements. bank-led channels. In particular. there are several factors that may explain the low rate of adoption of alternative distribution channels. These include the Internet-led channels. perceived complexity across insurance lines (personal and commercial) may continue to serve as a deterrent to adoption. As noted earlier in the paper. complexity is one explanation for why different distribution systems co-exist. A variety of distribution channels are currently used in the market place and some insurers utilize a combination of distribution channels. agents continue to be the primary distribution channel for insurance products. it may in part reflect the consumer’s perception that insurance is a complex product. While it is true that insurance purchasers today have more options available than they did five years ago. Given the low adoption rates for sales via the life advisor. If the advisor has to experience . The experience of insurance agents has been much different. it is unclear if and when these channels will dominate existing insurance distribution channels. To gain a better understanding of what factors tend to drive the adoption of one channel over another. To date. it may be that consumers consider insurance products to be more complex than originally thought.Distribution Channel: The insurance marketplace is undergoing a transformation that may eventually lead to significant changes in how consumers purchase insurance products.

 Unlimited income with network of contacts. Mentoring: Training and support from the Company to meet your goals. .  Prestige among peers  Be your own boss and write your own pay cheque.  Long term economic security. 2.  Regular incomes for years till the policies sold by you are in force. You would also enjoy the benefits of continuous training and mentoring programs that are designed to update you.significant gains as a distribution channel. apart from enhancing your selling skills. life insurance offers with an opportunity for:  An exciting / challenging career.  Flexible work hours.  Represent a strong. Enriching training program: An intensive training program before you commence your new career. trusted brand. Life Advisor Profile: As a Life Advisor the role would go beyond selling policies. its benefits and our products. Opportunity to learn from industry professionals. This would equip you with all the information and knowledge about life insurance. Hence. Support and Benefits provided by us As a Life Advisor with ICICI PRUDENTIAL Life Insurance you would enjoy the following benefits: 1. then perceptions regarding product complexity will have to change. The role would be to explain life insurance and its benefits to potential customers and help them decide which plan suits them best after analyzing their financial needs. This would help you perform your job better and meet your goals.

providing both short and long term solutions to financial risks. estate planning and personal investment. Freedom: Continue with your present job occupation if you so desire and treat this as a parallel source of income. foreign trips and Sales promotional schemes. You act as a strategist in annuities. Leather portfolio bags. 7. 5. Qualifications required and Expectation  A wide social network  Good interpersonal skills  Desire to meet people  Attend all training programs  Follow sales processes  Maintain customer records  Enhance company image  Render customer service . Planners. Earnings: Entitlement to a percentage of the premium as commission till the time the policies sold by you are in force.3. Satisfaction: You will help people manage their assets and plan their financial security. 4. and experience deep satisfaction from making a positive difference in others lives. Attractive additional benefits for high-performers: Palmtops. Offsite conferences. This allows you time to decide if you want to take the job of a Life Advisor as a full time activity. Flexibility: Decide you own working hours and earning goals. 6. business insurance.

Payment of premiums . 1. Prohibition of Rebates All Life Advisors have to strictly comply with Section 41 of the Insurance Act 1938 as regards prohibition of rebates to clients. either directly or indirectly. An "insurance advertisement" means and includes any communication directly or indirectly related to a policy and intended to result in the eventual sale or solicitation of a policy from the members of the public. or its products unless. there is an authorization in writing from the Chief Marketing Officer of ICICI PRUDENTIAL Life Insurance Ltd. as an inducement to any person to take out or renew or continue an insurance in respect of any kind relating to lives or property in India.Life Advisor Restrictions: Any Life Advisor found violating the restrictions listed below is liable to be terminated from the services of the company. any rebate of the whole or part of the commission payable or any rebate of the premium shown on the policy. except such rebates as may be allowed in accordance with the published prospectuses of the insurer" 2 Restrictions on Advertisements A Life Advisor is strictly prohibited from issuing an "insurance advertisement" which publicizes ICICI PRUDENTIAL Life Insurance Ltd. 3. nor shall any person taking out or renewing or continuing a policy accept any rebate. and shall include all forms of printed and published materials or any material using the print and or electronic medium for public communication. "No person shall allow or offer to allow. The following are the extracts from Section 41 of the Insurance Act 1938.

4 Suggestions . Life Advisors are strictly prohibited from advancing premiums on behalf of proposers or policyholders. CHAPTER: 5 SECTIONAL WORK DONE IN THE COMPANY 5.1 Products Offered 5.2 Work Done at ICICI PRUDENTIAL Life Insurance 5.3 Findings 5.

Read more 5. Read more . Read more 2. Read more 4. provides retirement & tax benefits applicable to an approved superannuation trust.Products Offered: The Following are the types of products offered by ICICI PRUDENTIAL. defined benefit and defined contribution. Group Super Annuation: This flexible plan for both. Group Term Insurance Plan: This insurance plan provides affordable cover to all your employees. Group Term Insurance in lieu of EDLI: This plan is certified by Employee Provident Fund Organistion (EPFO) as a superior alternative to Employee's Deposit Linked Insurance Scheme. Read more 3. ICICI Prudential offers a suite of Group Insurance plans that provide both you and your employees with a host of benefits: 1. Group Gratuity Plan: This hassle-free plan enables you to effortlessly fund your statutory gratuity obligation. Annuity Solutions: This suite of retirement plans enables you to provide your employees with a steady income all through their retired lives.

there is no element of savings or investment in such a policy. the policyholder pays regular premiums until his death.► Term Insurance Policy A term insurance policy is a pure risk cover for a specified period of time. While the insured buys the policy at a young age. however. It simply means that a person pays a certain premium to protect his family against his sudden death. a Whole Life Policy is an insurance cover against death. So. What if he survives the 15-year period? Well. irrespective of when it happens. For instance. By the time he dies. It doesn't take into account a person's increasing needs either. Under this plan. ► Whole Life Policy As the name suggests. He forfeits the amount if he outlives the period of the policy. if a person buys Rs 2 lakh policy for 15-years. following which the money is handed over to his family. his family is entitled to the money if he dies within that 15-year period. fails to address the additional needs of the insured during his post-retirement years. . As a result of these drawbacks. the insurance company keeps the entire premium paid during the 15-year period. What this means is that the sum assured is payable only if the policyholder dies within the policy term. insurance firms now offer either a modified Whole Life Policy or combine in with another type of policy. then he is not entitled to any payment. his requirements increase over time. It is a 100 per cent risk cover. This explains why the Term Insurance Policy comes at the lowest cost. the value of the sum assured is too low to meet his family's needs. This policy.

insurers offer various benefits such as double endowment and marriage/ education endowment plans. With inflation becoming a big issue. The cost of such a policy is slightly higher but worth its value. the sum assured is payable even if the insured survives the policy term. The purpose of an annuity is to protect against risk as well as provide money in the form of pension at regular intervals. ► Money Back Policy These policies are structured to provide sums required as anticipated expenses (marriage. A pure endowment policy is also a form of financial saving. etc) over a stipulated period of time. In an Endowment Policy. In case of death. the insurance firm has to pay the sum assured just as any other pure risk cover. The premium is payable for a particular period of time. On survival the remainder of the sum assured is payable. In addition to the basic policy. ► Annuities and Pension In an annuity. education. If the insured dies during the tenure of the policy. he gets back the sum assured with some other investment benefits. whereby if the person covered remains alive beyond the tenure of the policy. That is why with-profit policies are also being introduced to offset some of the losses incurred on account of inflation.► Endowment Policy Combining risk cover with financial savings. the insurer agrees to pay the insured a stipulated sum of money periodically. the full sum assured is payable to the insured. endowment policies is the most popular policies in the world of life insurance. companies have realized that sometimes the money value of the policy is eroded. . A portion of the sum assured is payable at regular intervals.

We know that effective management brings down the cost of the service. on that behalf the best way to increase performance is that there should be proper system of evaluation. my training was related to recruitment of life advisor and to gain knowledge about distribution channel of Insurance business. So. Inside story of the company & are above expectations. The task was performed under the following way: A. housewife. B. Then we find the target market as per our perception. We follow the task under the given time frame. I am dividing my learning experience into the above-mentioned parts for better understanding: a) Marketing or getting people’s perception at the time of profile of life advisor. govt. At ICICI PRUDENTIAL. student. It includes businessman. Firstly we acquire the knowledge about this prestigious concern after that we follow the schedule of work prescribed by our training in-charge. C. self employed. We follow this rule in development of distribution channel. Over the years. employee. professionally qualified person etc. . about the new private life insurance companies and also about the products of ICICI Life available in the market. retired professional. We follow the criteria of 4*6 as determined by ICICI PRUDENTIAL Life under the process of segmentation. The following are the name of product offered to different segment of market: Work Done at ICICI PRUDENTIAL Life Insurance: ICICI PRUDENTIAL Life Insurance is a company known for its professionalism and survive that gives value to the customer. insurers have added various features to basic insurance policies in order to address specific needs of a cross section of people.

b) According to them LIC has a strong monopoly in the insurance market and nobody is going to break it. people often say that I have my LIC instead of saying that I have my life insurance policy. As data was not provided by the company so my first target source was my friend circle for the agent purpose. These types of activities demoralize people from becoming the agent of a life insurance company. But with good products & value added services. In almost 40% cases I found such answers. b) Whenever I met a person and talked about ICICI Life the person told me that he already has a life insurance license from LIC and rigid to belief. so it is a time wastage to become an insurance agent for ICICI PRUDENTIAL. ICICI PRUDENTIAL emerges as a good player in the private sector. . c) The success rate in making life advisor was less due to rigid thought and negative determination about insurance selling. Out of twenty-five leads of mine I made two agents over there. it’s not a prestigious job as they belong to good families (in terms of money). after serving 47 years in the country with no competition LIC has created an atmosphere when people think that life insurance means LIC. Practical experience at the time of making an agent: To convince a person to become an agent off any life insurance company is a very tough job. The second main point was postponement by target person. and to this perception. because after opening up of the insurance sector the agent force of LIC has created a mess in the market. and rest of people declined due to reasons which are as follows: a) According to them. by paying the first premium of client from their own pocket. It’s a very tough job to break the monopoly as well as the goodwill of LIC in the market.

c) They thought that instead of spending their time on ICICI Prudential Life
they should go for LIC, which is more beneficial.
d) Money charge is also one of the factors for refusing under the process of
life advisor recruitment.
e) Since they are not ready to become an insurance agent but when I
explained about the ICICI bank and about their Group and have good
market goodwill with ethics, four of them get agreed with me for becoming
the agent of ICICI Life.


Following Are the Findings of My Study based on the work
done in the company:
 Most of the people are satisfied with their work profile. They are not
interested in earning more via insurance industry.
 Most of the people felt that the training procedure is quite tough for
become a life advisor due to their circumstances.
 The prospective advisors for this kind of job are Professional, retired
personnel from public or private sector, housewives, advocates,
student, other agent (i.e. Post Office Agent), and anyone who have good
contact etc.
 Most of the people do not know about broker, corporate agents and
bank assurance; they rely on their agents only.
 People don’t take seriously the prospects of selling insurance, which
can return them more than satisfactory benefits and commission if they
do it effectively.

 Most of the people prefer to become an advisor for Life Insurance
Corporation of India rather than for private companies due to the
strong feeling about Govt. concern.
 Some people have their doubts on the credibility and long stay of
private insurance companies.
 Many people shows the postponement attitude towards become an
advisor for insurance selling.
 Some people who want to earn more not admire the profile of life
advisor due to marketing aspect.
 Because of less advertising many people lacking facts about private life
insurance companies.


In the light of the finding mentioned above, the following suggestions are
offered to improve the functioning of the Kotak Mahindra Life Insurance in
terms of operating efficiency:
 Advertising of the insurance product should be used to create
awareness with brand identity.
 Insurance should be popularized as the means of securing future
rather than saving tax.
 Information should be correctly communicated with their respective
people for increasing brand loyalty.
 With the help of excellent services they can develop the position in
front of customer. This is one thing that private players can do.
 The processing fees for becoming an advisor is Rs.1000.This should be
borne by the company as it acts as a deterrent in converting prospects
into advisors.

 Newspaper/Magazines and television are the most effective medium of
advertising life insurance. So they utilize these medium for popularity.
 Insurance advisors should be well trained because they are the people
who directly fulfill the motive of concern.



The need of the hour is to devise a comprehensive strategy that will help the firms face the challenges of the future. Recommendations There is some of the recommendation we had come up with while doing this project. It will help to make insurance more important sector in today’s economy.  The penetration of insurance in India is around 22%. Therefore ICICI PRUDENTIAL Life is recommended to shed light on policies and explain the benefits. It is very important that trained marketing professionals who are able to communicate specific features of the policy should sell the policy. thus increasing the awareness.  From our study we could find out that people are not aware about the policies and features of insurance. The financial services industry around the world over is undergoing a major transformation. This indicates that a vast majority of rural population is not covered. The market player needs .

Insurance has always been used as a Tax saving tool. * A well-established distribution network. * A change in the attitude of the population Indians have always been wary of employing their hard-earned money in a venture that will pay them on their death. These are not exactly what any player.  Insurance companies will also have to get savvy in distribution. This will also help the consumers feel safe that the regulatory is an active one and cares to do everything possible to keep things under control and help the insurance environment grow maturely. looks for. They should follow the following factor of success in insurance business i. The reason for this being on the top of our understanding is that when ever we have seen any sector open up in India there are always grey areas and unsure policies. Enhanced marketing thus will be crucial. The case in example is of the State Bank of India. It is up to the insurers to educate the people to secure/insure their future against any unknown calamity and make a shield around their families and businesses. be it Indian or foreign. To cater to the largest democracy in the world is by no means a cakewalk. * An open and transparent environment created under the IRDA. The . In the next millennium all these activities would play a crucial role in the overall development and maturity of the insurance industry. No more. The future seems to belong to financial supermarkets that will offer a host of services and products to the consumer.e. no less. It creates an air of uncertainty in all the decision making process. Insurance as a sector requires players who are strong financially and are willing to wait for returns. to explore this untapped potential through their marketing and sales network. Insurance profits are directly related to number of insured and this is in turn related to the reach.

* Trained professionals to build and sell the product. Thus the players will require an excellent sales team to sell their products in the now competitive environment. The players feel that the compulsion is unjust and will affect their return on investments. This is the beauty of capitalism that we are . This is a very critical area as far as the government and the players are concerned. It is said that the insurance agent is the best salesman in the world. An unbiased environment is where the best comes out of the players. We also need to bear in mind that the insurers are here not for charity but for profits. To prevent any underhand workings of the insurer and to prevent them from going bust. Any failure of the insurer on account of unwarranted profligacy will cost the nation in general and the insured in particular. He makes you pay. Their real strength shines through. This is so because as per the guidelines 15% of the policies written by the 5th financial year will have to come from the rural area. The importance can be seen from the fact that a lot of LIC/GIC personal are being poached by the new players. * A stringent accounting practice to prevent failures amongst the insurers. * A level playing field at all stages of development in the sector for all the players. an amount promising to pay back only on your death. The banks are the only ones who have that reach. So their interest is also to be kept in mind. regularly. The government as fixed up the investment pattern for the players to meet its social obligations. Every insurer will have the hard-earned money of the masses. * A more rationale approach to the investment criteria.joint ventures announced have a flavour of network being a critical decider. a stringent accounting practice is imperative.

trying to achieve in our customized manner. CHAPTER: 7 CONCLUSIONS . This will only help the industry grow and so will the society. And last but not the least patience amongst the players and consumers to wait for the pot of gold at the end of the rainbow.

Insurance sector in the USA is as big in size as the banking industry there. India has an enormous middle-class that can afford to buy life. this sector will bring the nations own money for the nation. health. and disability and pension plan products. Conclusions India has traditionally been a high savings oriented country . In India where infrastructure is said to be of critical importance. In 3 years time we would expect the 10% of the population to be under some sort of an insurance cover. This assuming a premium of Rs. 500 bn. Insurance sector channelizes the savings of the people to long term investments. This has made the sector the hottest one in India after IT.often described as being on par with the thrifty Japan. The low level of penetration of life insurance in India compared to other developed nations can be judged by a comparison of per . amounts to 100 million x Rs.5000 = Rs. the role of the regulator becomes all the more serious and one that would be carefully watched at every step. With social security and security to the public at large being the agenda for opening the sector. This gives us an idea of how important the sector is. 5000 on an average.

but even that takes time. perhaps peace of mind. .400 billion business in India and yet its spread in the country is relatively thin. it can be observed that non-life business is not increasing as strongly as life business. In fact. rising literacy rates and increase of the service sector. So what does insurance offer. Clearly. but nobody is looking for returns to the inflation rate. as has been seen from the example of several other developing countries. opening up of the insurance sector is an integral part of the liberalization process being pursued by many Developing Countries. The primary reasons for becoming an insurance advisor.capita life premium. We do not invest in insurance for returns. There has been a strong fall in insurance business in recent years. rather we invest in it for regrettable necessities. There has been tremendous change in the insurance history. there is considerable scope to raise per capita life premium if the market is effectively tapped. And with it there has been continuous growth in this sector both in Indian as well as world context. due to poor claim performance. Insurance as a concept has not been able to make headway in India. whether life or non- life is to sell policies of mutual benefit for people. The opening up of the insurance sector has changed the whole look of the industry. The demand for insurance is likely to increase with rising per- capita incomes. Though a large proportion of policies available in the country provide for returns. growth fluctuations have been relatively small with growth rates varying between 1% and 5%. While the LIC in order to face the competition is coming with new strategies and new players like Kotak Life are leading the sector due to their strategic management and tailored made projects. Insurance is a Rs. Furthermore. On the other hand. From our study also we conclude that though the awareness and people opting for LIC plans are more as compare to Kotak Life but the later are gaining momentum in the market day by day.

CHAPTER: 8 APPENDIXES .Life insurance business by contrast achieved average growth rates of 6%. More and more insurers are utilizing distribution channels as they continue to balance the needs of different groups of consumers against the cost of distributing their products and services. although the actual rates ranged from 0% to 13%. So lets conduct this business with utmost economy with the spirit of trusteeship. This shows on the one hand the increasing significance of life insurance as an instrument for old age provisions and on the other hand indicates the sensitivity of life insurance to changes in the institutional and economic environment. thereby making insurance widely popular. And last but not least. When it comes to insurance distribution channels one-size does not fit all.

In the context of life insurance. . Annuity: The amount paid under an annuity scheme at stipulated intervals like yearly/half yearly/quarterly/monthly intervals.2 Bibliography GLOSSARY A Accident: A sudden and unintentional happening leading to a loss. Accumulation Period: The time interval between the commencement of the policy and the time when benefits are paid out. 8. Actuary: A professional with expertise in technical aspects of insurance. Accidental Death Benefit: An add-on benefit in which the benefit is payable in the event of death of the life insured as a result of an accident provided he has opted for this benefit. It is established by the insured. Agent (Life Advisor): A representative of an insurance company authorized to sell insurance policies. An actuary is a statistician and mathematician by training.1 Glossary 8. it is a sudden and unforeseen happening that causes disability or death of the policyholder.

E Endowment Plan: A plan in which the amount is paid to a policyholder if he outlives the tenure of the contract or to the beneficiary if the insured person dies before the date on which the policy matures. H . This group should already be in existence and should not have come together only for the purpose of insurance. 1999. he is concealing information. F Free look period: A free look period gives the client an option to review the terms and conditions of the policy within 15 days from the date of receipt of the policy document. Bonus: Bonus is the amount added to the basic sum assured under a with-profit life insurance policy. D Death Benefit: The benefit received by the beneficiary (ies) on the death of the insured. For instance. if the applicant is suffering from a terminal disease and he does not notify the company of this. it is called concealment. G Group Life Insurance: Life insurance of a group of people under a policy. C Claim: A request for payment of the contractual benefits by the insurer that is made by the insured or the beneficiary. B Beneficiary: The person who receives the benefit of a policy in case of death during the term or the policyholder who receives the benefit on maturity. Concealment: When an applicant withholds critical information from the insurance company.Authority: The Insurance Regulatory and Development authority established under sub- section (1) of section 3 of the Insurance Regulatory and Development Authority Act.

M Money Back Plan: A plan in which part of the sum assured is paid back to the policyholder at regular intervals. License: Permission granted by IRDA to the applicant for commencement of the ins. P Policyholder: The person who owns the policy. it is the apex body overseeing the insurance business in India. N Nomination: A provision by which a policyholder can designate any person to receive the policy money in the event of his death. Premium: The amount paid by a policyholder to the insurance company. Level Premium Life Insurance: Life insurance for which the premium remains unchanged year after year. for purposes of life insurance. L Lapse: The termination of an insurance policy due to non-payment of premia. I IRDA: The acronym for the Insurance Regulatory and Development Authority of India. in order to be covered under a policy.Human Life Value: The present value of the family's share of the breadwinner's future earnings is considered as Human Life Value. It protects the interests of the policyholders. promotes and ensures orderly growth of the insurance industry and for matters connected therewith or incidental thereto. Nominee: A person selected by the policyholder to receive the benefit in case of death of the life insured. regulates. a life insurance policy. R . Maturity Date: The date on which the policy term expires. in this case. business in India.

Reinsurance: The transfer of part of the risk by the original insurance company to one or more reinsurers. Surrender Value: A value payable if you want to surrender the plan before a claim arises. Term Cover: A type of life insurance where the sum assured is payable only in the event of death of the insurer during the specified term. whenever that occurs. BIBLIOGRAPHY PERIODICALS AND MAGAZINES:  Finance India. less the relevant trading costs associated with selling the assets. T Term: The tenure of the policy.Rider: An add-on benefit available at the option of the policyholders that may alter certain features of a policy by increasing or restricting benefits. The premium payment can happen for a specified number of years or throughout life. S Selling price: This is the price at which you can sell units. Journals  Business world  Annual Report of Kotak Mahindra BOOKS & ARTICLES: . based on the market value per unit. W Whole Life Insurance: A life insurance policy where benefits are payable to a beneficiary on death of the insured.

org    www.irdaindia. .iciciprulifeinsurance.ICICI.  Article by Mr.  Article By Global Financial Services on Insurance Industry Status dated September26.bimaguru.indiainfoline.  www.indianexpress.2005 WEBSITES    www. Mathur on Contribution of Life Insurance Sector in The  Other related websites.