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Maharaja Agrasen Institute of Management Studies
Sector -22, Rohini, Delhi-110085

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INTRODUCTION…………………. 1.1-OBJECTIVES…………………..

Research Design……………….. Descriptive Research…………... Type of the Universe…………… Population………………………. Sampling Unit…………………... Sample Size……………………...
Data Collection……………………….

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DATA ANALYSIS…………………………………...



………….. CHAPTER-5









I also thank my project guide Ms.ACKNOWLEDGEMENT I express my deep sense of gratitude to Mr. NAVEEN KUMAR JHA. N. SANAMPREET KAUR (FACULTY) for her valuable guidance.K. I owe my thanks to Dr. I conclude by thanking all the respondents who have helped me collect data. for their honest participation in the survey and my family and friends for their constant support throughout the project. for giving me opportunity to Work for ICICI Prudential.Kakkar (Director of MAIMS) for his ineffable help that proved to be of great insights during the study. The support provided by staff of ICICI Prudential made an otherwise seemingly difficult task easy. Neha Vats MBA 3rd Semester Enrollment No:-0871483906 . I am grateful to him for his sagacious guidance which enabled me to accomplish this project.


TATA AIG. The low level of penetration of insurance in India compared to other developed nations can be judged by a comparison of per capita life premium. 2000. But now with the opening of the insurance sector to private participants insurance is fast emerging as a much better alternative tax planning in terms of returns as well as security. Birla Sun. The current budget has been a wake up call for Indian investors. Life Insurance Corporation of India was formed and all other life insurance companies gave their business to the corporation. control to raise much needed development funds. Allianz Bajaj. the insurance Regulatory and Development and was formed and from July 1. SBI Life. the Indian govt. ING Vyasa. The insurer pays the financial losses suffered by the insured as a result of the occurrence of unforeseen events. With less than 10 years of independence. Investors should save and invest . India has an enormous middle – class that can afford to buy life. health and disability and pension plan products. Max New York Life. Om Kotak Mahindra and the public. At present. Then. The era of fixed return instruments is over. In 1999. Insurance needs to have social objectives and new covers will not have that commitment. Insurance has always been a politically sensitive subject in India. nationalized private insurance companies in 1956 to bring this vital sector under govt. HDFC Standard Life. in return for the payment of premium by the insured. The basic intention was to pay the concept of life insurance to the gross root level of the Indian society. there are life insurance companies in India-ICICI Prudential. private players entered the insurance market. This budget makes a point very clear one should be investing according to his financial goals and not with the only objective to save tax.EXECUTIVE SUMMARY Insurance is a contract where by. Prior to the Indian sector had become 246 companies in the insurance sector.

one can never undermine the importance of insurance in one’s financial plan insurance as it is rightly said cannot be taken as a simple investment.more for his protection and meeting his future needs. . And an uncertainty needs to be planned for simply because it is uncertain. Moreover it’s an obligation that one has towards to the family to ensure that the members are financially well off in any eventually. His saving should not be dependent upon governmental sops. rather it is a hedge against uncertainty. Regardless of the tax compulsion.


The private sector companies will have to make a difference in order to compete with the age old player Life Insurance Corporation which had monopoly in the market till now. 5.Birla Sun Life 5.ICICI Prudential 2. To study the general savings trend existing in the market and find priorities of people while making investments in different saving schemes and their reasons for the same. To study the new techniques adopted by these companies so as to penetrate the market.Om Kotak Mahindra 6.1 Scope of the study For the purpose of the project. I have undertaken new private sector insurance companies along with the sole existing player LIC. The Insurance Companies are: 1.TATA AIG Insurance OBJECTIVES . Privatization of insurance sector plays a vital role.Max New York 4.VyasaING 7.CHAPTER-1 PREFERENCE FOR INSURANCE DRIVEN BY AGE AND OCCUPATION In this fast changing economic scenario. I have selected this topic to have an insight on the efforts that have been made by this new companies• • • To find the difference made by the new private insurers terms of varied and specialized products.HDFC Standard Life 3.

3.This survey would help in finding the general awareness in the market about the products offering by the different private insurers in the market.To know about the future plans of people for buying an insurance policy. 2.1.To carry out a market survey in order to find the preferences of different professionals who belong to different age groups for the willingness to opt for the new insurers 4. 5.To carry out a market survey in order to find the preferences of different professionals who belong to various income groups for their investment in to Life Insurance or in Small Savings.To study the scope of as an investment opportunity and to know the priority of people while selecting different Savings Schemes. .


which would be considered for the purpose of study . time and money. Sampling Unit:It is the unit. the unit would be the individuals who are having the policy for any insurance company. Its function is to provide for the collection of relevant evidence with minimal expenditure of effort. Type of the Universe:It is the first step in developing any sample design. it is to clearly define the set of objects. But. to portray accurately the characteristics of a particular situation or a group. In my study the research purpose is as follow: Preference for Insurance driven by age and occupation Descriptive Research:Research Study i. Sample Size:This refers to the number of the items to be selected from the universe to constitute the sample. To commence the study sample size is taken because these are persons who have the life insurance policy from any insurance company.RESEARCH METHODOLOGY Research Design:It is conceptual structure within which the research is conducted. . how this can be achieved depends on the research purpose. Population: It includes all the residents having Insurance Policy from any company in Delhi.e.To conduct an analysis. technically called Universe.

From primary data questionnaires are used as a method of data collection. websites are used. . In order to carry the research to know the effect of age and occupation on purchase of insurance policy primary data is required. To collect secondary data brochures. newspapers.Data Collection:In order to obtain the required information following data is collected To do an analysis of the policies of various insurance companies secondary data is required.


it’s sold to them. That’s the basic purpose of life insurance. if the claims and expenses are more than the premium. Individual awareness and understanding of life insurance products is extremely low. parents) to maintain their current life style and pursue their goals---till such time as they are in a position to set up an alternative income stream by themselves. Insurance during the 21st century:A financial planner once said this about life insurance buying habits of Indians: they don’t buy life insurance. undertakes to indemnify the losses suffered by the other party. your life insurance should enable to your dependants (spouse. If you are adequately insured. and many among the insured don’t even know whether the life insurance policy they own meets their insurance needs. their personal finance needs. Unfortunate.OVERVIEW OF THE INDUSTTRY Under an insurance contract. In this unit. but true. for some specified causes in consideration for a fixed premium. The first---and the most important---step towards ‘doing better’ involves being financially literate. Life insurance is chiefly a risk management tool. This means being aware of the various types of insurance products on offer in the market. they could be doing better. called insurer. An insurance company makes profit if the claims and expenses of insurance company are less than the premium collected by it. 1938 and Insurance Regulatory and Development Authority Act. we shall discuss various types of insurance business and different types of insurance policies as an introduction before taking up the accounting issue. and in a larger context. 1999. . one party. But insurance companies generally make profit. Also we shall discuss relevant provisions of the Insurance Act. The document that contains terms of insurance contract is called Insurance Policy. at the least. called insured. as well as having the ability to understand one’s life insurance needs and find appropriate fits. children. and having. meant to offer financial protection to your dependants in the unfortunate event of your death. since the ratio the claims of policyholders to the total premium collected from them tends to be low. an elementary understanding of what life insurance is all about. chances are. In most cases. it sustains losses.

Hansell. Explain the insurance coverage’s and policy types available to homeowners and renters:. set your goals. and risk shifting. risk that attach to individuals.Owners of homes and automobiles face the risks of (1) property damage or loss.” Insurance is a plan by themselves which large number of people associate and transfer to the shoulders of all. 3. and review your results.” Fundamental Definition: In the words of D.S. 2. Renter’s insurance includes the same coverage’s excluding protection for the building owner. life insurance has come to represent more than just risk cover. and personal liability. risk assumption. Property and liability insurance.” OBJECTIVES OF INSURANCE 1. The main types . make a plan to reach your goals. The best-selling insurance products in the market double as investment options and offer attractive tax breaks. and (2) legal actions by others for the costs of injuries or property damage. it’s because of this two-in-one profile that they appeal to the average individual who seeks convenience in personal finance matters.” Insuance accumulated contributions of all parties participating in the scheme. risk reduction. Discuss the importance of property and liability insurance:.But in India. as the most other developing markets. put your plan in to action. is there a way to get the same benefit for a lower cost? How does one make that call? DEFINITION:General Definition: In the words of John Merge.Home owner’s insurance includes protection for the building and other structures. In fact. But is insurance really good investment? Or. offer protection from financial losses that may arise from a wide variety of situations faced by owners and users of automobiles. additional living expenses. In planning a personal insurance program.The four general risk management are risk avoidance. personal property. Develop a risk management plan using insurance:.

The amount of home insurance coverage is determined by the replacement cost of your dwelling and personal belongings. they did not have to repay the loan. thereby recovering some or all of the loss. bottomry enabled ship owners to borrow money against their ships to pay for the trip. 4. country home. The story goes back to around 2100 BC. traders and seafarers were reluctant to sail to other lands for fear of their lives and goods. By the end of the 18th century Lloyd’s had progressed in to one of the first modern insurance companies. So. and modified coverage forms. based on the statistical laws of mortality and compound interest. to the ancient civilization of Babylon and a business practice called ‘Bottomry’. comprehensive. previously the rate had been the same for all ages. the type of structure. Bottomry gave them some semblance of security. The table. Lloyd’s Coffee House (1688) was a place where merchants. the coverage amount. In London. discounts. These policies differ in the risks and property they cover. Analyze factors that influence the amount of coverage and cost of home insurance:. With piracy rampant on high seas. The arrangement was that only if their ship returned did traders have to repay the loan. which was pegged at an above-market rate for the risk covered. made it possible to scale the premium rate to age. HISTORY OF INSURANCE As with so many things in so many facets of our lives. In 1693 the astronomer Edmond Halley constructed the first mortality table. broad. tenant’s. and underwriters met to transact business.of home insurance policies are the basic. the policy type. corrected (1756) by Joseph Dodson. . special. condominium. ship owners. The cost of home insurance is influenced by the location of the home. Insurance too was born out of a primal need and shaped by socio-economic realities of the time. if their ship failed to make it back. along with interest. For all practical purposes a form of marine insurance. and insurance company differences. Milestones: • • • • • By the middle of the 14th century marine insurance was practically universal among the maritime nation of Europe.

S. continue asset cover Retired 60s CHARACTERSTICS OF INSURANCE • • • Sharing of risks Cooperative device Evaluation of risk . continue asset cover Continue health insurance for self and spouse. unless you have dependants Extend health insurance to family. storms. There is evidence that marine insurance of such nature was followed in India some 3000 years ago.• The first stock company to engage in insurance were chartered in England in 1720. and in 1735. continue accident and asset covers Same as above Young 30s family 30s Mature 40s family 40s Empty 50s nesters 50s Top up health cover for for self and spouse.C. A Roadmap for Insurance AGE Young 20s adult 20s LIFE INSURANCE NON-LIFE INSURANCE But only if you have Buy accident and health dependent insurance. requisite asset cover Subtract existing assets from future expenses. Insurance developed rapidly with the growth of the British commerce in the 13th & 14th century. the first insurance company in the American colonies was founded at Charleston. mutiny and wars. • Fire Insurance corporations were formed in New York city (1787) and in Philadelphia (1794). and cover the difference Maintain cover to balance the shortfall in existing assets Maintain cover till you are earning No life cover needed. The oldest and earliest records of insurance come in form of marine insurance where ships and cargo were insured against perils such as pirates.

Insurance cautions businessman and individuals to adopt suitable device to prevent unfortunate consequences of risk by observing safety instructions . which is based upon certain principles of insurance. etc. 4.• • • • • • Payment on happening of a special event The amount of payment depends on the nature of losses incurred The success of insurance business depends upon the large number of people insured against similar risks Insurance is a plan. indemnity. subrogation.Insurance cannot check the happening of the risk.Insurance determine the probably volume of risk by evaluation various factor that give rise to risk. causes proxima. Provide Certainty:. which helps to change from uncertainty to certainty. 3. but can provide for the losses of risk. contribution.Insurance is a device to share the financial losses of few among many others. utmost good faith. Prevention of Losses:. insurable interest.Insurance is a device. Collective bearing of risk:. Secondary Functions 1. • The scope of insurance is much wider and extensive FUNCTIONS OF INSURANCE Primary Functions 1. Provide Protection:. which includes. which spreads the risks and losses of few people among a large number of people The insurance is a plan in which the insured transfer his risk on the insurer Insurance is legal contract. Assessment of risk:. 2.

insurance . 3. During the early years of 19th century. Contributes towards development of large industries. Post 1947. The best way then was socialist pattern of government was adopted thus government nationalized a no of operation that were important for the development of the economy and the social health of the nation.Insurance relives the businessman from security investment. The basic intention was to take the concept of insurance to the grass root level of the Indian society. India had a great challenge of coming out of the dark into an era where many countries were happily progressing on the way of advancement. the young nation also had to build security at all levels among the citizens of the nations. Then Life Insurance Corporation Of India was formed and all the other life insurance companies gave their business to the corporation. and 1967. Prior to this the Indian sector had some 246 companies in the insurance sector. was set up in Calcutta in year 1710. a large number of life insurance companies were formed in India. Insurance was one such industry that saw industrialization in year 1956. 1710 1818 1850 1870 1907 1912 The first company Sun Assurance Office Ltd was set up in Calcutta British introduce life insurance to India. with the establishment of the Oriental life Insurance Company in Calcutta Non-life insurance debuts. Small capital to cover large risks:.2. with Triton Insurance Company Bombay Mutual Life Assurance society is the first Indian-owned life insurer Indian Merchantile Insurance is the first Indian non-life insurer. Besides the infrastructure required developing the nation industrially. by paying small amount of insurance against larger risks and uncertainty. Life Insurance Act 1923 was passed and later emended in 1946. Some of these companies preferred to amalgamate their business with other companies and a good number failed to function effectively. 1958. who had recently witnessed the painful partition. The Indian life Assurance Companies Act enacted to regulate the life business. EMERGENCE IN INDIA In India the first company known as Sun Insurance Office Ltd. In order to stabilize and strengthen the insurance business.

N. autonomy to PSU insurers Insurance regulator IRDA (Insurance Regulatory and Development Authority) set up IRDA starts giving licenses to private insurers. GIC set up Malhotra Committee. headed by former RBI governor R. replaces earlier act Life Insurance nationalized. as TPAs enter the scene. which forms the basis for most current insurance laws. ICICI Prudential and HDFC Standard Life first private life insurers to sell a policy.1938 1956 1956 1972 1993 1994 1997 2000 2001 2002 Insurance Act. Governments sets up LIC Non-life insurance nationalized.1 (List of Insurance Companies) Life Reliance Life Insurance Kotak Mahindra-Old Mutual Max India-New York Life Prudential-ICICI HDFC-Standard Non-Life Reliance General Insurance ICICI-Lombard Insurance Wadia-Commercial Union Cholamandalam-Axa M A Chidambaram-Merlife . Royal Sundaram Alliance first non-life insurer to sell a policy Banks allowed to sell insurance plans. set up to draw up a blue-print for insurance sector reforms Malhotra Committee recommends re-entry of private players. Malhotra. government takes over 245 Indian and foreign insurers and provident societies. insurers start setting non-life claims in the cashless mode Table 1.

including banks) A minimum capital adequacy ratio of 10 percent Entry through a joint venture UNTAPPED OPPORTUNITIES There is no doubt that the market for the buyers of insurance is significant in India and offers a great scope of growth. First: While estimating the potential of India Insurance Market we often attempt to look at it from the perspective of macro-economic variables such as the ratio of premium to GDP.Aditya Birla-Sun Life Insurance C K Birla-Zurich Insurance Hindustan Times-Commercial Union Centurion Bank-Canada Life Sanmar Group-GIO Tata-AIG 20th Century Finance-Guardian Group Punjab National Bank.2% in the US. 5 bn: A minimum capital requirement of Rs 1 bn. which is indeed comparatively low in India. 2000: • • • • A minimum net worth of Rs. This figure is 50% for finance.5% in UK or 8% in South Korea. Vijaya Bank. The central bank had laid out a set of five parameters that had to be met as of March 31. Allahabad Bank and Bank of India-Yasuda Fire and Marine IFFCO-Tokyo Fire & Marine Sundaram Finance-Royal & Sun Alliance Vyasa Bank-ING Apollo Hospitals-Aetna Bank of Baroda & Punjab National BankForeign partner In the developed nations of USA and UK. (this is mandatory for any players in the sector. bank account for 20% and 19% of all insurance products sold. India’s life insurance premium as a percentage of GDP is 1. But the . 6. For example.3% against 5. This shows the extent of scope that Bank assurance (a model where banks all insurance products) as model has the RBI regulations come in light of the fact that most banks are looking at their NBFC outfits for foraying into insurance sector.

fact is that the large part of the India’s (number of potential buyers of insurance) is certainly attractive. However, this ignores the difficulties of approaching this population. New entrants in other mass industries such as consumer products or retail banking have discovered this after burning their fingers. Much of the demand may not be accessible because of poor distribution, large distances or high costs relative to returns. Secondly: Most new entrants have a tendency to target the business of existing companies rather than expanding the market, this is myopic. This not only leads to intense competition for the new players and their much of their efforts is spent on trying to capture existing customers by offering better service or rather advantages. Yet, the benefits of this strategy are likely to be limited. For example, 50% of the current demand for general insurances comes from the corporate segment. The corporate are likely to shop around for the best rates, products and services. Nevertheless, the corporate segment, as a whole will not be a big growth area for new entrants. This is because penetration is already good, companies receive good service because of their size and rates are tariff-governed in both volumes and profitability therefore, the scope for expansion is modest. A better approach may be to examine specific niches where demand can be met or stimulated.

1. Superior To Any Other Savings Plan: Unlike any other saving plan, a life insurance policy affords full protection against risk of death. In the event of death of a policyholder, the insurance company makes available the full sum assured to the policyholder’s near and dear ones. In comparison, any other saving plan would amount to the total saving accumulated till date. If the death occurs prematurely, such savings can be much lesser than the sum assured. Evidently, the potential financial loss to the family of the policyholder is sizable. 2. Encourages And Forces Thrift: A savings deposit can be easily withdrawn. The payment of life insurance premiums, however, is considered sacrosanct and is viewed with the same seriousness as the payment of interest on a mortgage. Thus, a life insurance policy in effect brings about compulsory savings.

3.Easy Settlement And Protection Against Creditors: A life insurance policy is the only financial instrument the proceeds of which can be protected against the claims of a creditor of the assured by effecting a valid assignment of the policy. 4. Ready Marketability And Suitability For Quick Borrowing: A life insurance policy can, after a certain time period (generally three years), be surrender for a cash value. The policy is also acceptable as a security for a commercial loan, for example, a student loan. It is particularly advisable for housing loans when an acceptable LIC policy may also cause the lending institution to give loan at lower interest rates. 6. Disability Benefits: Death is only the hazard that is insured; many policies also include disability benefits. Typically, these provide for waiver of future premiums and payments of monthly installments spread over certain time period. 6. Accidental Death Benefits: Many policies can also provide for an extra sum to be paid (typically equal to the sum assured) if death occurs as a result of accident.

The role and importance of insurance, has been discussed in three phases: 1. USES TO AN INDIVIDUAL (i) Insurance provides Security and Safety: The insurance provides safety and security against the loss on a particular event. In case of life insurance payment is made when death occurs or the term of insurance is expired. The loss to the family at a premature death and payment in old age are adequately provided by insurance. In other words, security against premature death and old age sufferings are provided by life insurance. (ii) Insurance affords Peace of Mind: The security wish is the prime motivating factor. This is the wish which tends to stimulate to more work, if this wish is unsatisfied, it will create a tension which manifests itself to the individual in the form of an unpleasant reaction

causing reduction in work. By means of insurance, however, much of the uncertainty that centers about the wish for security and its attainment may be eliminated. (iii)Insurance protects Mortgaged Property: At the death of the owner of the mortgaged property, the property is taken over by the lender of money and the family will be deprived of the uses of the property. On the other hand, the mortgage wishes to get the property insured because at the damage or the destruction or the property he will lose his right to get the loan repayed. The insurance will provide adequate amount to the dependents at the early death of the property-owner to pay off the unpaid loans. Similarly, the mortgage gets adequate amount at the destruction of the property. (iv)Insurance eliminates dependency: At the end of the husband or father, the destruction of family needs no elaboration. Similarly, at destruction of property and goods, the family would suffer a lot. It brings reduced standards of living and the suffering may go to any extent of begging from the relative, neighbour and friends. The economic independence of the family is reduced or, sometimes lost totally. (v) Life Insurance provides Profitable Investment: Individuals unwilling or unable to

handle their own funds has been pleased to find and outlet for their investment in life insurance policies. Endowment policies, multipurpose policies, deferred annuities are certain better form investment. The elements of investments i.e. regular saving, capital formation, and return of the capital along with certain edition return are perfectly observed in life insurance. In India the insurance policies carry a special exemption from income-tax, wealth-tax, gift tax and estate duty

1. Uncertainty of business losses is reduced: in word of business, commerce and industry a huge number of properties are employed. With a slight slackness or negligence, the property may be turned in to ashs. The accident may be fatal not only to the individual or property due to the third party also. New construction and new establishment are possible

The amounts of loan that can be obtained with such pledging of policy. but in both the cases the business and the partners will suffer economically. If the borrower is unwilling to repay the loan and interest. . 4.with the help of insurance. Each partner may be insured for the amount of his interest in the partnership and his dependents may get that amount at the death of the partner. The new as well as old businessmen are granted payment of certain amount with the insurance policies at the death of the person. uncertainty will be to the maximum level and nobody would like huge amount in the business or industry. 3. 2. Increasingly. Enhancement of credit: The business can obtain loan by pledging the policy as collateral for the loan. money-back. with interest thereon will not exceed the cash value of the policy. Business efficiency is increased with insurance: When the owner of the business is free from the botheration of losses. pure investment products (pension plan) and investment-cum-insurance products (endowment. the lender can surrender the policy and get the amount of loan and interest thereon repaid. POLICIES Based on their objective. this cash value can be utilized for setting of the loan along with the interest. In the absence of it. Business Continuation: In any business particularly partnership business may discontinue at the death if any partner although the surviving partners can restart the business. The insured persons are getting more loans due to certainty of payment at their deaths. whole-life and unit-linked insurance plans). he will certainly devote much time to the business. insurers are launching hybrid variants of these plain-vanilla plans. basic plans offered by insurers can be classified under three broad categories: pure insurance products (term plan). In the case of death. the property of the business is protected against disasters and the chance of disclosure of the business due to the tremendous waste or loss. The insurance policies provide adequate funds at the time of death. The carefree owner can work better from the maximization of the profit. at the damage. With the help of property insurance. destruction or disappearance of the property or goods.

the plan tenure and the nature of returns. at five-year intervals (in years . MONEY BACK PLAN Money-back plans are variant of endowment plans. the ‘sum assured’. you still get back the sum assured and returns. the sum assured. the pay back in money-back plans is staggered through the policy term. Typically. with the differences arising from whether they offer the policyholder a share in the insurer’s profits or not. in the illustration below. As much as this “money if you die. to barely 4-6 per cent a year. terms and conditions. A portion of the premium paid by you is invested by the insurers on your behalf. a part of the sum assured is returned to you at periodic intervals through the policy tenure. where the survival benefits are disbursed at the end of a policy term. your nominees receive the cove amount----in insurance parlance. if you die during the policy term. it’s purely from the objective of giving a broad idea of the cost-benefit equation for each of these plans. The premium will depend upon your get no benefits if you survive the policy term. Rs 3 lakh is paid back in three installments. which lowers the effective yield on your investment in endowment plans. TERM PLAN Term plans are the purest form of insurance. money if you live” philosophy is an enticing proposition. There are two types of endowment plan. These are no-frills policies that cover only the risk of your dying. So. you pay premiums for a pre-defined tenure and sum assured. Although the illustrations are based on existing policies. your nominee gets the sum assured plus some returns. in reality. id you survive the policy term.The working of the six basic plans follows. will vary from insurer to insurer. Since the entire premium paid by you-----the cost of buying insurance cover-----on term policies goes towards covering the risk of your life. which drag down the returns from endowment plans. Another portion goes towards your cover and a third towards meeting the insurer’s administrative expenses. For example. with one basic difference: unlike endowment plans. ENDOWMENT PLANS While term plans covers just the risk of death. In an endowment plan. as well as premiums. In the event of your death during the policy term. endowment plans also offer some return on the premiums paid by you. insurers offer you this cover at the least cost. it comes at a price: high premiums.

compared to conventional endowment plans. Your insurer too is governed by certain investment restrictions: it can invest . the bonus is calculated through the term on the full sum assured (Rs 5 lakh. which can serve as a useful income stream during your later years. UNIT-LINKED INSURANCE PLANS In insurance-cum-investment plans of the kind listed above. Wholelife plan are structured such that the policyholder has the option to pay premium up to a certain age(referred to as the ‘maturity age’ which is generally 80-100 years) or for a specified period. In case of a death claim. you yourself would have accumulated. Whole-life plan. the insurer gives you the option to either continue with the cover through the lifetime (for which no further premiums will have to be paid) or encash the maturity benefits(sum assured plus bonuses). Similarly.5. provide you cover through your lifetime------the only class of insurance polices to do so. you have little say in where your money is invested. and 15). for example. WHOLE-LIFE PLAN The three categories of insurance plans mentioned above provide you life cover for a defined period. along with guaranteed additions or bonus (as the case might be). Because of this staggered payback. your life insurance needs start to taper off after the age of 50. without deducting any survival benefit that may have already been paid as money-back components. a sizeable nest-egg to see you through your retirement years. Bonus do you really need life cover through your life-time? Typically. or are well on your way to accumulating. on other hand. his nominees will get the sum assured (Rs 5 lakh) -----with no deduction for the Rs 1 lakh money-back installment paid to the policyholder in year 5-plus bonuses accrued till year 5. not the balance. is returned at the end of the tenure. In our illustration. if the policyholder passes away in year 6 of the term. The full sum assured will be paid. if you so desire. up to a certain age (generally. On reaching maturity age. The balance sum assured. Your children are earning and probably in need of life cover themselves. this early return. doesn’t reduce the sum assured of money-back plans. however. Some insurers do give the option to encash the bonus during the term itself. Typically. in our example). Only if you have financial dependants or have an income stream to protect during your post-retirement years does it make sense to buy a whole life-policy.10. the premium on money-back plans is higher than on endowment plan. 70 years).

Think of them as insurance plans that double as mutual funds. The balance 80 percent in the first year (more in the subsequent years) is invested in an investment plan of your choice. in part or in full. and you are allocated units. growth plans (high on equity. around 20 percent of the premium is deducted by the insurer towards your risk cover and to meet its own administrative expenses (this figure drops gradually through the plan term. they also lead to rigidity in investment are rein in your returns to low single digits. by giving you greater control over where your premium is invested. low on equity). if you think stocks are overvalued. or. So. Just like in a mutual fund. tend to project a range of returns for each plan.000 a year. the premium payable is Rs 6. You can switch from one plan to another free of cost once a year (a nominal amount is charged for additional switches). Unit-linked insurance plans get around such restrictions. existing these plans is also easier and it doesn’t invite prohibitive penalties. depending on your plan’s performance. Take note that these are just guesstimates----what you end up with could be higher or lower. one year). unlike endowment plans. you can move your money to the income plan.Unit-linked insurance plans also enable you periodically monitor the performance of your investment.The investment plans on offer cover the riskreward spectrum. once in three months. After a lock-in period (generally. for example. insurers declare the NAV of the various plans periodically-----generally. While such restrictions are intended to ensure safety of your investment. low on debt) and balanced plans (roughly equal distribution between debt and equity). you can withdraw your units anytime. if you think stocks are going cheap. You can also make incremental investments any time. tapering off at around 5 percent). based on the historical performance of their plans and their return expectations. You can choose from income plans (high on debt. In the illustration given below. based on the prevailing net asset value (NAV) of the plan you have to opted for. at the then-prevailing NAV. the greater chunk of 90 percent has to be invested in debt paper. Insurers. you can move to the growth plan. Unit-linked insurance plans are meant for individuals who understand investing and the stock market but prefer to leave it to the experts to do active money . you can control your investment in unit-linked insurance plans. in the first year. for the sum assure d of Rs1 lakh on a 20 year plan. The annual premium you pay on unit-linked plans is linked to the sum assured and the policy tenure. By their very nature. typically.just 10 percent of the premium paid by you in equities. and add a corresponding amount to your life cover. Thus. your life cover will be reduced accordingly.

management. The case to prefer Unit-linked insurance plans conventional endowment plans is compelling. in endowment plans.20 years-----durations that give a good chance to reap the true returns potential of equities. Insurance plans are long-term plans. with an immediate annuity. as a result of which returns from them are pedestrian. PENSION PLAN Pension plan differ from the five types of the insurance plan mentioned above in the fundamental way. your investment earn a return. The precise returns you will get depend upon several factors: your age begin when you investing. So. similar to other investment-based insurance plans. depending on when the insurer begins the annuity paybacks. and feel ill-equipped to handle their investments on their own. Immediate or deferred? The payback from pensions plan generally takes the form of an annuity----. the age at which you want the money to start coming back to you. are looking to set up an immediate. Unit-linked insurance plans offer that possibility. especially for knowledgeable investors. There are two types of annuities. this option would appeal to those who have retired or are about to retire. not all of them of life over. Pension plans are investment options that let you set up an income stream in your post-retirement years by routing your savings through an insurer. the contribution you make. You hand over a lumpsum (say. and the number of years for which you want the returns. endowment plans don’t maximize returns. they are prepaid to forfeit assurances on returns for a chance to take home more than what a convenience endowment plan would offer. though your money stays locked foe similar length of periods. and grow without being taxed----until you receive your annuity . as it is called). your investment preferences based on your risk profile. why we are talking about them here? Because pension plan feature among the bevy of products offered by insurers and are pitched as retirement planning schemes. based on your assessment of your life expectancy and the needs of your financial dependents. The other type of annuity is a deferred annuity. At least 90 percent of it I invested in low-yielding debt instruments. the payments start the year you but the contract. who invests it on your behalf for a free. regular income or stream. with tenures stretching to 10. your superannuation benefits) to your insurer and choose the periodicity of payments and the number of years for which you want a pension. In other words. wherein the annuity payments are deferred for later years (at a predefined age of vesting. are paid a certain swum every year. During the accumulation phase.

In other words. Riders are options that allow you to enhance your life cover. Some insurers exclude critical illnesses that may have been caused by the . mixed and matched. visualize a situation where you require hospitalization and surgery for a critical illness. CRITICAL ILLNESSES The Critical Illness Insurance Rider provides additional cover in the event of a critical illness. when ‘riders’ came in to the picture. coronary artery bypass. Before you sign on. A separate medical insurance policy would enable you to claim the expenses. heart attack. investments are well-managed annuity plans have the potential to grow substantially over a long period. check the list of illnesses covered or non-covered. insurers are packing in a few options that provide greater flexibility to your pension plan. riders are optional and available in a variety of ‘flavours’. qualitatively and quantitatively. And each comes for a small additional cost. That was the case till mid-2001. Consequently. you are committed to making periodic payments. The illnesses covered and the premiums vary across insurers. since these are conceived of as long-term investment vehicles. you would need two policies---one to cover your life and another to cover your medical expenses. However. And as with toppings. to be picked and chosen. RIDERS Life insurance offers some degree of financial protection to your dependants in the event of your death. and is paid on diagnosis of a critical illness. kidney/renal failure. Most insures cover cancer. But the cover would have come at an additional cost. on the back of entry of private players.payments. major organ transplant and paralytic stroke. Typically. In fast-food parlance. but the cover would enable you to claim the expenses. the extra cover is equal to the sum assured on the base policy. which are make financial sense if you are likely to move to a lower tax bracket after your retirement. based on one’s preferences. premature withdrawals invite prohibitive penalties. they are the toppings you add to your pizza of choice in order to improve its taste to your liking. For instance. Deferred annuity schemes enforce a savings discipline: unlike with self-managed investments. Additionally. Increasingly. only then will you also benefit from the power of compounding. Your life insurance policy cannot be invoked to recover your medical expenses. you are liable to tax (at appropriate slab rates) on your annuity withdrawals. But it doesn’t cover you for some extreme contingencies. so it is important to stick with them.

your insurer will pay you Rs 15. Also. a few insurers terminate the base policy once a claim is made on the rider. Rs 15. Typically.000 under section 80D (for senior citizens. This rider is invoked on hospitalization. the policyholder is paid a part of the sum assured (only for the rider)---. if you are hospitalized for three days. Unlike the critical illness rider. so. that may require medical treatment and hospitalization. you have a taken a sum assured of Rs 50. you are entitled to a maximum of 50 percent of the sum assured. for each surgery. there are two components to this rider: sum assured and the daily compensation. where age doesn’t influence the premium). the policyholder is paid 50 percent of the total sum assured (for base policy plus rider) and the balance in installments over the next six months. In other words. Your insurer will compensate you for the duration of your stay in the hospital.existence of pre-existing ailments. this rider gets terminated if a critical illness is diagnosed to be terminal in nature. Check for exclusions. even if it means a marginally higher premium on the rider. Each claim reduces the sum assured for the .000 and a per-day hospital cash benefit of Rs 5.000 as compensation. The premium payable depends on two factors: the sum assured and the age of the policyholder (unlike most other riders. That’s why a plan that continues to give you life cover after a rider has been activated. Typically. The premium paid qualifies for a tax deduction up to Rs 10. is preferable. Hospital Cash Benefit Rider. A critical illness rider can be bought for Rs 250450 (the band is on account of varying cost and coverage) per Rs 1lakh sum assured.000. specify a minimum hospitalization of 48 hours and stipulate a ceiling on the daily compensation amount. When this rider is invoked. MEDICAL EXPENSES Riders under this category cover risk towards ailments. the maximum you will get in this case is Rs 50. other than critical illnesses. the hospital cash benefit rider is neither terminated when a claim is made nor is there any draw-down in the claim limit. which means you are covered for hospitalization of 10 days.000 (because the claim amount under this rider is capped at the sum assured).depending on the nature of surgery. such riders don’t cover hospital admittance for routine check-ups. Typically. the amount varies between 20 percent and 50 percent of the sum assured. In such cases. subject to conditions and exclusions. Insurers charge around Rs 200 per Rs 1 lakh sum assured for this riders. Major Surgical Assistance Rider. This rider provides a policyholder financial support in the event of surgery.000). Say.

The merits of opting for this rider are evident. . the older you are and the more the riders you add. check the list of surgical procedures covered and exclusions. This rider provides for an additional cove. Broadly. Typically. It is the insurer’s prerogative to renew the rider cover the year following a claim year----it might not do so if the nature of the surgery indicates further medical complications. under the surgical assistance rider. the premium amount can be claimed as a tax rebate under section 88. Generally. The premiums payable to buy this rider depends on. This rider is available for Rs 80-120 for a sum assured of Rs 1 lakh. Some insurers even waive future premiums payable on the base life policy. equal to the sum assured in the base policy. or becoming unemployed due to injury or sickness. and it qualifies for a tax deduction under section 80D. There is also a cap on the sum assured. the higher will be the premium you pay on this rider.remainder of the year by the corresponding amount. The higher the premium on the base policy. The premium payable for this rider varies between Rs 290 and Rs 600 per Rs 1lakh sum assured. The premium is in a range because only a few insurers allow the base policy to continue once a claim is made on the rider. your age and other riders you might have taken. among other factors. which differs across insurers. Most insurers exclude claims arising from pre-existing injuries or illness. the claim amount due to an accident. Precisely hoe the term ‘completely disabled’ is defined varies from insurer to insurer. the claim amount is staggered. Disability/Discrimination Benefit Rider. Before you sign on. The premiums due on the base policy and riders are waived till the person is able-bodied and employed again. you can get a cover of up to 50 percent of the base sum assured. in case of a disability due to an accident. as well as surgeries done in hospital that are not registered with the municipal body concerned. so as to give the policyholder a stream of income to fall back on. DISABILITY BENEFITS Riders under this category address contingencies that arise in the event of a disability. the premium you are paying on your base policy. Waiver of Premium Rider. The rider gets activated in the event of a policyholder becoming ‘completely disabled’. In other words. it includes anyone who is disabled to the point where he is unable to perform the regular and normal duties of his job.. Generally. this rider provides ‘disability insurance’ against your life insurance policy. particularly in cases where the premium on the base policy is high.

If the death occurs while traveling with a ticket in an authorized public mass transport system. 3. 1972 (including Rules framed there under). Level Term Rider. namely bus or train. Section 11 of the Insurance Act. The rider offers death benefit alone. 1938 prescribes the manner in which the accounts of the insurance company has to be maintained. With the opening of the insurance sector for private players. The Companies Act. 1. The premium payable is Rs 80-200 per Rs 1 lakh insured. Various aspects relating to accounts and audit are dealt with by the following statutes and rules/regulations made thereunder. The Insurance Act. 1939) 2. The Insurance Regulatory and Development Authority Act. Accident Death Benefit Rider. insurers give the policyholders twice the accident cover stated under this rider. IRDA Act. to regulate. 1938 (including Insurance Rules. The level term rider costs around Rs 250-300 for a sum assured of Rs 1 lakh.MISCELLANEOUS RIDERS Here are a few other riders on offer and an indication of what to look out for when you buy them. and the premium payments quality for the section 88 rebate. and addresses a need for extra protection for a specified time period. The Insurance Regulatory and Development Authority Regulations. 1999. 1938 and the IRDA Act. 4. LEGAL FRAMEWORK The primary legislations which deals with the insurance business in India are the Insurance Act. such as a time when you are carrying large debt and wish to insulate your dependants from financial liability in the event of your death. The General Insurance Business (Nationalization) Act. 1999 was passed to provide for the establishment of an authority to protect the interests of the holders of insurance policies. and 5. This rider gives you the option to increase your risk cover in non-term plans. This rider is activated in case of a policyholder dies due to an accident during the term of the policy. 1956. up to a maximum of the sum assured on your base policy. promote and ensure orderly growth of the insurance industry and form matters connected therewith or incidental thereto . 1999. and qualifies for a tax rebate under Section 88.

1938. VARIOUS INDIAN COMPANIES AND THEIR FORIGN PARTNERS ARE: Life Insurance Indian partner HDFC 20th Century Finance ITC Tata Group Godrej Group ICICI Ranbaxy Dabur DCM Shriram Consolidated Bombay Burmah Trading Foreign partner Standard Life (UK) Canada Life (Canada) Eaglestar (UK) AIG (US) J Rothschild (UK) Prudential (UK) CIGNA (US) Liberty Mutual (UK) Royal and Sun Alliance (UK) General Accident (Scotland. But since they are oriented towards retirement planning and are offered by insurers. 1956 and the General Insurance Business (nationalization) Act. the life Insurance Corporation Act. UK) . Section 114A of the IRDA Act. 70. PENSION PLANS Not all pension plans have an insurance component built in to them. they too get some preferential tax treatment.and further to amend the Insurance Act.000 in other Section 88 instruments. 1999 empowers IRDA to make regulations consistant with the Act. to carry out the purposes of this Act for various matters specified in said Section 114A. though not of the order offered under conventional life insurance plans. 1972. bonds and Rs.

K. to promote industrial development of India by providing project and corporate finance to Indian industry. Since inception. Modi Bank Vyasa Bank Chubb Insurance (US) Allianz Holding (Germany) Zurich Insurance (Switzerland) Commercial Union (UK) Guardian Royal Insurance (UK) Winterthur Ins (Switzerland) Metlife (UK) ING Bank (Netherlands) ING Bank (Netherlands) CHAPTER II COMPANY PROFILE HISTORY ICICI PRUDENTIAL LIFE INSURANCE COMPANY LTD. The World Bank. . Chidambaram Group S. ICICI has financed all major sectors of the economy. Birla Hindustan Times Peerless Sundaram Finance M. ICICI has grown from a development bank to a financial conglomerate and has become one of the largest public financial institutions in India.K.Kotak Mahindra Alpic Finance C. the Government of India and the Indian Industry. in 1955. established ICICI LTD.A.

000 advisors. ICICI Prudential's equity base stands at Rs. to form ICICI Prudential Life Insurance. ICICI PRUDENTIAL LIFE INSURANCE COMPANY ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank. which has today emerged as one of the leading mutual funds in India. COMPANY HISTORY Partners ICICI and Prudential came together in 1993 to form Prudential ICICI Asset Management Company. The two companies bring together two of the strongest financial service brands in Asia. the two companies joined hands once more in 2000. 980 crore. 1999. Riding on the success of this relationship.000 crore and premium income in excess of Rs. Has had its presence in Asia for the past 75 years catering to over I million customers across 11 Asian countries. a premier financial powerhouse and prudential plc. The company is a joint venture of ICICI (74%) and Prudential plea UK (26%). 2000. with a commitment to provide leading-edge life insurance solutions.Prudential plea was founded in 1848. for a total sum assured of over Rs 8. . It has a presence in over 15 countries. It manages assets of over US$259 billion as of December 31. In the year ended March 31. ICICI Prudential was amongst the first private sector insurance companies to begin operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). a leading international financial services group headquartered in the United Kingdom.000 policies.75 billion with ICICI Bank and Prudential plc holding 74% and 26% stake respectively. Today the company is the no. Prudential plea. as well as 12 banc assurance tie-ups.1 private life insurer in the country.2300 million and the paid up capital is Rs. The company has a network of about 30. 6. 2004. ICICI Prudential Life Insurance Company Limited was incorporated on July20. excellent quality of service and long term commitment to YOU. 1500 million. the company had issued over 430. The authorized capital of the company is Rs. known for their professionalism.

Prudential has brought to market an integrated range of financial services products that now includes life assurance. Indonesia. In Asia. supported by over 60. Since 1923.ICICI Bank has 74% stake in the company. The Bank enjoys the highest AAA (or equivalent) rating from all leading Indian rating agencies. Prudential has championed customer-centric products and services. call centre and Internet banking ICICI Bank posted a net profit of Rs. India. This includes mortgages. Japan. Malaysia. ICICI Bank provides a broad spectrum of financial services to individuals and companies. ICICI Bank is the only Indian company to be rated above the country rating by the international rating agency Moody''s and the only Indian company to be awarded an investment grade international credit rating. corporate and agricultural finance. 1675 ATMs. 2003. Hong Kong. Thailand and Vietnam.1.206 crore for the year ended March 31. Korea. 106812 crore. PRUDENTIAL PLC Established in 1848. banking.China. the Philippines. Prudential is UK''s largest life insurance company with a vast network of 22 life and mutual fund operations in twelve countries . pensions. The Bank services a growing customer base of more than 7 million customer accounts and 5 million bondholders’ accounts through a multi-channel access network. Prudential plc is a leading international financial services company in the UK. . credit and debit cards. with around US$250 billion funds under management. investment management and general insurance.000 staff and agents across the region. Taiwan. This includes about 450 branches and extension counters. and Prudential plc has 26%. Singapore. mutual funds. car and personal loans. and more than 16 million customers worldwide. ICICI BANK ICICI Bank is India''s second largest bank with an asset base of Rs.




The benefit under the policy is paid to the beneficiary nominated by the member on his/her death. which offers life cover at very low cost. SmartKid child pland are also available with in unit-linked form . level term assurance with return of premium and single premium .Save n Protect is a traditional endowment savings plan that offers life protection along with adequate returns. expenses for a child''s higher education or purchase of an asset -SmartKid child plans provide guaranteed educational benefits to a child along with life isurance cover for the parent who purchases the policy.CashBak is an anticipated endowment policy ideal for meeting milestone expenses like a child''s marriage. -Group Superannuation Plan: ICICI Pru offers a flexible defined contribution superannuation scheme to provide a retirement kitty for each member of the group. -Group Term Plan: ICICI Pru''s flexible group term solution helps provide affordable cover to members of a group. . The plan can also be customized to structure schemes that can provide benefits beyond the statutory obligations. It is available in 3 options . The cover could be uniform or based on designation/rank or a multiple of salary. .VARIOUS POLICIES PROVIDED BY ICICI PRUDENTIAL LifeGuard is a protection plan. The policy is designed to provide money at important milestones in the child''s life. Employees have the option of choosing from various annuity options or opting for a partial commutation of the annuity at the time of retirement.level term assurance.ForeverLife is a retirement product targeted at individuals in their thirties -Group Gratuity Plan: ICICI Pru''s group gratuity plan helps employers fund their statutory gratuity obligation in a scientific manner.both single premium and regular premium. .

This rider is available with SecurePlus and CashPlus. the beneficiary receives an additional amount equal to the sum assured under the policy. Benefits are payable to the insured for medical expenses prior to death. till maturity. 3. Critical Illness Benefit: protects the insured against financial loss in the event of 9 specified critical illnesses. the premiums are waived till maturity. 2.RIDERS: 1. It is available on SmartKid. in the event of the death of the life assured. 4. If the death occurs while traveling in an authorized mass transport vehicle.Waiver of Premium: In case of total and permanent disability due to an accident. Secure Plus and Cash Plus. Income Benefit: This rider pays the 10% of the sum assured to the nominee every year.Accident & disability benefit: If death occurs as the result of an accident during the term of the policy. . the beneficiary will be entitled to twice the sum assured as additional benefit.

Various investment banks and brokerage houses have put the combined value of the holdings to be transferred to ICICI Holdings at between Rs16. actuarial provisioning and marketing expenses.5 million policies. It is the largest private sector life insurer in the country with a network of 450 branches and 1. For the third quarter of 2006-07. 1 private life insurer in the country. 2007.5 lakh agents across the country. the company garnered Rs 3. with a wide range of flexible products that meet the needs of the Indian customer at every step in life. For the 11 months ended February 28.500 crore.000 advisors. The company has a network of over 540 offices.000 crore and Rs21. ICICI . That translates to a value of between Rs170 and Rs240 per share of ICICI Bank.745 crore of weighted retail + group new business premiums and wrote over 1. ICICI Prudential has retained its position as the No. which is the present value of all future potential profits. NBAP of the life insurance business was reported at Rs193 crore as compared to Rs142 crore for the same quarter of previous financial year. This is true for all private sector life insurance businesses floated in recent years. It was one of the first players to commence operations when the insurance industry was opened to the private sector in 2000. as well as 22 bank partners. one of the largest insurance and fund management companies in Europe. PERFORMANCE ICICI Prudential Life Insurance is a joint venture of the bank with Prudential Group.BUSINESS ICICI PRUDENTIAL LIFE INSURANCE ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank and Prudential plc. ICICI Bank measures the performance of its life insurance businesses on the basis of new business achieved profit (NBAP). It is also the only life insurer in India to be assigned AAA (Ind) credit rating from Fitch Ratings. The NBAP of ICICI Prudential Life increased from Rs312 crore during 2004-05 to Rs528 crore in 2005-06. the huge growth potential in the domestic market would ensure very high valuations for these businesses. The life insurance venture has been making losses since inception because of high set up costs. over 200. which may accrue to shareholders from insurance policies written during a particular period. For the past six years.

within just five months after crossing the 3 million policy milestone. Its weighted premium market share amongst private life insurers stood at 30. taking the total capital investment to Rs. which includes opening new branches and offices across the country as well as scaling up operations to meet the expansion. 245 crore. 1 private life insurer. thus retaining its No. ICICI Prudential continues to have the largest capital base amongst all life insurers in the country. to notch up retail weighted + group new business premium of Rs 3.745 crore. India's No. taking the capital infusion during the year to Rs 875 crore. This is the fourth equity hike during the financial year 2006-07. 245 CRORE ICICI Prudential Life Insurance Company.3% for the period. ICICI Bank and Prudential plc. 2060 crore. "Both ICICI Bank and Prudential plc have recognized the promise of the life insurance industry in India. With Rs 2060 crore of capital. contributed to the capital in their existing proportions of 74:26 respectively. this large capital base is one of the most important indicators of the solvency of the company and its ability to meet all its policyholder commitments. For consumers. It will also enable ICICI Prudential to continue driving its expansion strategy over the next year. . In the period April 2006-February 2007. has increased its capital by Rs. The two promoters. the company also crossed the 4 million policies mark. the company grew 100% over the same period in the previous year. and have regularly committed the resources required for ICICI Prudential to grow and maintain its clear leadership in the category" The additional capital will be used to fund the high up-front expenses required by a life insurance business and meet the solvency norms as stipulated by the regulator. 1 position amongst private life insurers in the country.  ICICI PRUDENTIAL LIFE INSURANCE INCREASE CAPITAL BY Rs.Prudential Life contributes between 60 and 65 per cent of the total value while ICICI Lombard and Prudential ICICI AMC contribute the rest. Last month.

Hariyali Kisaan Bazaar can now distribute ICICI Prudential's protection. has announced a strategic distribution tie-up with Hariyali Kisaan Bazaar.1 million new policies. making ICICI Prudential’s asset base the largest amongst private life insurers and also making it one of the largest managers of retail funds in the country. has earned new business weighted premium of Rs 2. has earned new business weighted premium of Rs 2.722 crore over the nine months April-December 2006. wealth creation. the largest private life insurer in India . As a partner. has announced a strategic distribution tie-up with Hariyali Kisaan Bazaar.459 crore.722 crore over the nine months April-December 2006. 1 private life insurer. retirement solutions and health insurance products to customers across the its growing number of rural business hubs in the country. In addition. . which now stands in excess of 15. During this period. Assets held as of December 31. the rural business arm of DCM Shriram Consolidated Ltd (DSCL). and has grown both location and branch network by adding around 300 branches over the past nine months. ICICI Prudential Life Insurance. 1 private life insurer. ICICI PRUDENTIAL LIFE INSURANCE POSTS 97% GROWTH IN APRILDEC 2006 ICICI Prudential Life Insurance. To fuel its continuing growth. ICICI Prudential also continues to retain its position as the leading private life insurer with a retail market share of 9% of total and 29% of the private market. the largest private life insurer in India . the company has over 175.000 employees across more than 360 locations. growing 97% over the corresponding period in the previous year. India's No. The company’s distribution ramp-up has been matched with an increase in its staff base. India’s No.  ICICI PRUDENTIAL IN STRAEGIC TIE-UP WIYH HARYALI KISSAN BAZAAR:ICICI Prudential Life Insurance. the company has written over 1. ICICI Prudential has expanded its distribution footprint. the rural business arm of DCM Shriram Consolidated Ltd (DSCL). 2006 stood at over Rs 13. growing 97% over the corresponding period in the previous year ICICI Prudential Life Insurance.000 advisors as well as several partners both for distribution and operations.

becoming the first private life insurer from India to open an office in the Emirate. Hariyali Kisaan Bazaar has established itself as a trusted.  ICICI PRUDENTIAL LIFE INSURANCE STRENGHTENS POSITION IN THE GULF REGION:Becomes first Indian private life insurer to open office in Dubai ICICI Prudential Life Insurance. India’s leading private life insurance company.4 million discerning NRIs in UAE. ICICI Prudential’s office in Dubai will be able to service the 1. ICICI Prudential and Hariyali Kisaan Bazaar can now also reach out to customers in rural areas to increase awareness of life insurance. ICICI Prudential has a multi-channel distribution strategy to reach customers. Rajasthan and Uttaranchal with over 50 outlets catering to their agriculture related needs. The office will promote and service the life insurance needs of the NRIs through ICICI . ICICI Prudential will deploy financial services consultants at Hariyali's hubs to advise rural customers on financial planning and saving towards their long-term needs. farmers are now looking for a trustworthy financial provider with whom they can save their hard-earned monies. after its first overseas office in the Kingdom of Bahrain. and we are delighted to partner with Hariyali to meet this need. Uttar Pradesh. The company's distribution partnerships have been highly successful in both sourcing new business and also driving awareness and increasing reach and penetration across the country. the company has distribution arrangements with established banks and large retail finance distributors. long-term partner for farmers across Punjab. which contribute about 40% of the company's business. Haryana. Through this new relationship. With their increased prosperity. health and pension products that meet their financial needs at different life stages Under the agreement. In addition to the advisor channel. and marks a move to further strengthen the company’s ability to cater to the vast non-resident Indian (NRI) population in the Gulf. "Our tie-up with DCM Shriram's Hariyali Kisaan Bazaar is in line with our strategy of partnering with organizations that have strong brands and loyal customer bases in their markets.Over the past five years. This is ICICI Prudential’s second overseas office. today opened its representative office in Dubai.

” Hospital Care is structured to enable customers to provide for all expenses associated with hospitalisation. Hospital Care is structured to ensure customers receive a pre-determined insurance amount for each procedure or hospitalization.  ICICI PRUDENTIAL LIFE EXPANDS HEALTH INSURANCE PRODUCT RANGE:Launches Hospital Care to offer guaranteed long-term health insurance ICICI Prudential Life Insurance. Available for individuals between the ages of 1-60 years. this is one of the first products that will cover people up to the age of 80 years. retirement solutions and health solutions. This is compounded by the concern that these policies are not long-term and that once a claim is made.Prudential’s wide range of products. With the launch of the new product. leaving them with a considerable financial burden. has further expanded its health insurance portfolio. its long-term design of a term between 10-20 years. Hospital Care. “Our research revealed that many customers believe that existing health insurance policies would not cover all the expenses related to hospitalisation or surgical procedure.000 surgical procedures and hospitalisation. Further. The insurance benefit includes: Daily hospitalization cash benefit: customer is paid a daily fixed benefit amount for every day he/she is in hospital . even if they spend less. education insurance. to other incidental expenses. the company moves into the realm of offering products that go beyond covering critical illnesses. which include wealth creation. ranging from room charges. and further strengthens its position as a significant player in the health insurance space. it might not be renewed or will attract a higher premium” We launched Hospital Care to fill this gap in health insurance and also offer customers control over their health spends. doctor and surgery fees. 1 private life insurer. India’s No. this time to cover over 1. assures policyholders the guaranteed cushion of insurance cover even if they make a claim during the term.

000 network hospitals across the country. Cancer Care Plus. ICICI Prudential’s other health insurance products include Health Assure. Any insurance amounts over and above those incurred towards hospitalization are paid directly to the policyholder.000 procedures covered graded as per type and severity Recuperating benefit : to take care of post-hospitalisation expenses Policyholders also enjoy a double claim benefit that will enable them to get the benefit amount under Hospital Care in addition to that claimed under any other health insurance plan. The policy offers a cashless claim benefit at 3. Health Assure Plus.Daily ICU cash benefit: additional 50% of the daily hospitalisation benefit is paid in case the policyholder is in the intensive care unit Surgery benefit: Lumpsum payment for a surgery. Diabetes Care and Diabetes Care Plus. Cancer Care. MARKET POSITION . with more than 1.

000 crores as of August 2006.7million lives insured. DIRECT COMPETITORS:- .As the vision states.  Highest Capitalized Company in the private insurance market: The equity base stands at Rs.  Over 2. Economic Times AC Nielson Survey.  Wide range of innovative products to suit the needs of customers at every step in life. 1085 crores.2003  Outlook Money Award Best Life Insurer (2003-04)  2004 Prudence Award for Customer Centricity  Avaya Global Connect Customer Responsiveness Award  ICICI Prudential is the first in India to receive a National Financial strength rating of AAA (Ind) by Fitch ratings.  Leadership position with a 32% market share among Private Life Insurance Companies (Quarter 1.  Record of settling 92% of claims received within eight working days from the date of receiving the last requirement.  No.  Over the past five years we have paid out over 2100claims amounting to more than 26 crores and takes several steps to assured customers of a quick and smooth claims process.finantial year 2006-2007)  11% of the overall Life insurance Market share. ICICI Prudential has maintained a dominant position in the Private Insurance Market. AWARDS & ACCOLADES  Most trusted Private Life Insurer. 5 years in a row. 1 in Asset Management of 10.



This age group is not self-dependent and policy is usually taken on their behalf in order to secure their future. They are dependents on the elders . safely needs. mostly belong to the age group of 25-35. On the other hand as few as 12% respondents come into the category of 15-25. The respondents who are considered to be major policyholder are those who are office goers.e. The policyholders are mainly serviceman. As the results from the Que3.DATA ANALYSIS:- Q1) GROUPS:- Age Distribution of the Respondents 20% 12% 30% 38% 15-25 25-35 35-45 45 & ABOVE The above graph indicates that out of 125 people who have the policy from any of the companies. It indicates that at this stage people start thinking of their future i.

Q2) OCCUPATION GROUPS:- Occupation of the Respondents 11% 4% 26% 59% Service Business Professional Others From the above figure indicates that out of 125 people who have the policy from any of the companies. mostly 59% belong to the service class. .

a big chunk of respondents have two-wheelers. . which is followed by car.Q3) WHICH OF THE FOLLOWING DO YOU OWN? Ownership of by various facilities by the Respondents 140 120 100 80 60 40 20 0 122 60 30 45 Two Wheeler Car Credit Card Air Conditioner This graph shows that out of policy owners.

Q4) HAVE YOU HEARD PRIVATISATION IN INSURANCE SECTOR? Awareness about Privatisation in Insurance Sector 13% 87% Yes No This has clearly out that 87% of the people have heard about privatization in Insurance Sector. This high degree of awareness may be because of heavy and aggressive advertisement by some of the new Insurance companies. .

Although TATA is one of the biggest names in the corporate India. Besides ICICI Prudential has become a brand in the sector of Financial services. being new in the market. Same is the case with HDFC Standard Life Insurance. Therefore.I.Q5) WHICH COMPANY ARE YOU AWARE OF IN THE INSURANCE SECTOR? Degree Of Awareness About Various Life Insurance Companies 120% 100% Percentage Of Awareness 100% 80% 60% 40% 40% 20% 0% Allianz Bajaj LIC Tata A. . therefore people are not very much aware about it. It was the only company operating in this field. awareness about ICICI Prudential is also high.GO HDFC Standard Life ICICI Prudential Max New York 32% 28% 72% 72% Life Insurance Com panies LIC is in existence from so many years. ICICI Prudential is advertising very heavily. Therefore. Max New York Life and Allianz Bajaj also have moderate level of awareness. everybody knows about LIC. but it is not associated with financial services.

But just 21% people came to know through agents which shows that their agents are not very much aggressive. If they are advertising. then people may be avoiding the ads on electronic-media because of heavy clutter of ads. The reason may be that they are not advertising heavily through electronic-media.Q6) FROM WHERE DID YOU COME TO KNOW ABOUT ICICI PRUDENTIAL LIFE INSURANCE? Source of Information 60% 50% 40% 30% 21% 20% 10% 0% Electronic Media Print Media Through Agents Others 12% 13% 53% This graph shows that most of the people (i. . while only 12% through Electronic media.e 53%) came to know about ICICI PRUDENTIAL LIFE Insurance through print media. They switch on to another channel whenever an ad appears on the TV.

Private sector is gaining such a faith because of their prompt and customer friendly services. .Q 7) DO YOU THUINK THAT SERVICE PROVIDED BY PRIVTATE SECTOR WILL BE BETTER THAN PUBLIC SECTOR IN INSURANCE? Percentage of people regarding private viza-viz Public sector 16% 10% 74% Yes Can't Say No This shows that ¾ people believes that private companies will provide better services than public sector i. This shows the increasing faith of faith of people in private sector. They are making the things easy unlike the public sector. LIC.e.

Q 8) WHAT ACCORDING TO YOU ARE THE MOTIVES OF BUYING LIFE INSURANCE? Motives of Buying Life Insurance Policy 70% %age of Respondents 60% 50% 40% 30% 20% 10% 0% Tax Savings Protection Motives Secure Investment Helps in Savings 61% 38% 28% 35% Primary motive of buying life insurance policy is to save tax. while protection or savings are the secondary motives. . People buy Life Insurance policy for the reasons other than what it is meant for.

they have to establish themselves yet.GO HDFC Standard Life ICICI Prudential Max New York 2% 3% 1% 2% 1% 91% Life Insurance Com panies 91% amongst the insured people have the policies from LIC. people like to get insured from LIC. in insurance sector. Even today. People do not believe in them easily. This is because of being the single company. That is the only reason they are having very low share in this sector. As private companies are new in the market.Q9) WITH WHICH COMPANY DO YOU HAVE INSURANCE POLICY? Market Share On The Basis Of Owner Ship 100% 90% Percentage Of Share 80% 70% 60% 50% 40% 30% 20% 10% 0% Allianz Bajaj LIC Tata A. for so many years. .I. It has very high brand image.

Q10) DO YOU HAVE ANY PLAN TO BUY INSURANCE POLICY NEAR FUTURE? Future Plan to buy Insurance Policy 30% 64% 6% Yes Can't Say No This shows that 30% want to but life insurance policy in future. which shows that demand is continues. It is because people use it as a tax saving weapon. Moreover. . this can also be interpreted that with the increase in population demand is also growing.

so plan does not matter much. . Most of the time their objective is to save tax.Q 11) IF YOU HAVE ANY PLAN TO BUY AN INSURANCE POLICY .WHICH POLICY WOULD YOU PREFER? Preference of plans 35% 30% 25% 20% 15% 10% 5% 0% 29% 24% 24% 29% %age of people Protection Investment Pension Savings Insurance Plans This graph shows that people don’t have any specific choice in buying a life insurance plan.


As far as future decision making about the policy is concerned most of the people would go in for protection plan. People believe in LIC only and therefore. which has maximum number of LIC and private sector policies. 7. 6. so people are more awareness of it a compared to the new players. It is the service class. 4. Further the findings reveal that the age group 25-35 has the maximum number of the people who have the policy with LIC as well as with the private sector insurance companies. which gives them tax benefits. so they prefer to go in for the investment plan. It will take a lot of time. Age has negligible while the occupation has an impact on buying of a Life Insurance Policy. that is why most of the people prefer Pension Plan. LIC has become a generic now. Since of. . LIC is the oldest player in the Insurance sector. 8. This clearly comes out the survey conducted that most of the people come to know about ICICI Prudential Life Insurance Company through print media. 2. 5. every body wants to go in for a policy with LIC. to private companies to win the confidence of the people. 3.FINDINGS 1. It has clearly come out that most of the people like to go in for a policy. It has clearly come out that as most of the businessmen have surplus money at their disposal. As far as future decision-making is concerned most of the service class prefer to protection plan. 9. The survey also reveals that people have strong faith in the services and capabilities of private sector.


therefore the promotion schemes should concentrate on educating the customers that Private sector players have a strong financial backing like that of LIC. To introduce innovative products offering a right mix of flexibility/risk/return depending. . People give a high priority to security of their investment.CHAPTER V CONCLUSIONS AND RECOMMENDATIONS 1. 3. which will suite the requirement of the customers and should target specific niches which are poorly served or are not served at all. these include educated professionals also. 4. People of ICICI Prudential Life Insurance Company should approach people who belong to age group of 25-35 & 35-45 also the people who belong to service-class as these are the only once who are interested in purchase a life insurance policy in future. It is seen that till today a large portion of population is unaware of various insurance plans. 5. both in print as well as in other media. the Private sector insurance companies should focus on improving awareness and increase the understanding about insurance plans thus increasing their scope of sale. Therefore. 2. ICICI Prudential Life Insurance Company should lay more stress on advertisements.


3. . Assumptions for the purpose of Analysis: Some assumptions were made while doing the analysis and interpretations. Unrepresentative sample size: The sample size taken for the purpose of the study does not very significantly represent the whole society and their Savings Investment patterns may not clearly bring out the average trends existing in the market. The interpretation of such responses becomes difficult and could generate wrong results. 2. 4.CHAPTER-VI LIMITATIONS OF THE STUDY It is said that “ Nothing is perfect” and if the quote is true I am sure that there would be few shortcomings in this project also. Nature of the study: The survey concentrated on personal information about income. This could have brought bias into the study. Limited Scope: The survey was conducted in Delhi thus the respondents belonged to only this region of the country. 5. Sincere efforts have been made to eliminate Discrepancies as far as possible but few would have been remained due to limitations of the study. These are: 1. Ambiguous replies or omission of replies: Some of the respondents gave ambiguous replies for certain questions or omitted the responses to some of them. there could be few limitations in regard to these. All these issues are highly sensitive and of secretive nature therefore there could have been untrue answers to some of the questions. savings and investment.


com www.BIBLIOGRAPHY BOOKS:- Indian Financial System by Varshney and www. WEBSITES:- .com www.chittorgarh.



1. 5. TELEPHONE NO. OCCUPATION (a) Service (b) Business _______________________________ ________________________________ ________________________________ ________________________________ (c) Professional (d) Others 6.What According to you are the motives of buying Life Insurance Policy? (b) Print Media (d) Others (b) No 8. Have you heard about Privatization in Insurance Sector? (a) Yes a b c d e f g 9. Which Companies are you aware of in life Insurance sector? (a) HDFC Standard Life Insurance (c) Allianz Bajaj (e) LIC (b) ICICI Prudential (d) Max New York Life (f) Tata AIG 10. AGE 3. Do you think that service provided by Private Sector will be better than Public Sector? (a) Yes (b) No . Which of the following do you own? (a) Two Wheeler (b) Car (c) Credit Card(d) Air Conditioner 7. NAME: 2. ADDRESS: 4. From where did you come to know about ICICI PRUDENTIAL LIFE INSURANCE (a) Electronic Media (c) Through Agents h i j k l m 11.

Do you have any plan to buy Insurance policy in near future? s (a) Yes t u v (b) No 15. Do you have Insurance Policy? q r (a) Yes (b) No 13. If you have any plan to buy an insurance policy.n o p (a) Tax saving and risk cover (c) Secure investment (b) Protection against loss of income (d) Helps in savings 12. (a) Protection (b) Investment (c) Pension (d) Saving THANK YOU .With which company do you have Insurance Policy? _______________________________________________ 14. which policy would You prefer.