Comparison Between Traditional Plan ULIPs PROJECT REPORT

7/27/2019 Comparison Between Traditional Plan ULIPs PROJECT REPORT

1/71

Comparison between traditional plan & ULIPs

EXECUTIVE SUMMARY

As the people are becoming more and more and aware of their Life Style and

Income level. they need a plan, which has an optimum balance between their Investment and

Savings. They require an integrated financial plan for investment.

The customer requires those investment options, which provide them with flexibility and

Liquidity and tax benefit.

Among the various other investment options, Insurance has gained a prominent place .It

provides the policyholder with the benefit of Life Protection and at the same time allows him

to take the benefit of the fluctuations of the share market.

Thus Life Insurance has taken a very vital position as a wholesome investment option.

Life Insurance is gaining public awareness and interest very rapidly. It was till now been

thought as a way to insure lives, But, recently it is emerging as a prominent Investment

avenue.

It has come up as a wholesome Investment avenue & provides the benefit of flexibility,

Liquidity and Life protection. Along with added benefits like the rider attachments which

protect the policyholder from various kinds of diseases and accident etc.

Objectives of the Study:

1. To know aware of investing in ULIPs and Traditional plans

2. To Study and Compare the Traditional Life Insurance Plans and ULIPs with

respect to ICICI Prudential life Insurance.

3. To know the factors influence while purchasing life Insurance plans.

4. To know the factors influence while purchasing the particular category of plan

1

BABASAB PATIL


2/71


Data source:

Primary Data: Personal interactions, Observations

Training programs. Through Questionnaire

Secondary Data: Study material by IRDA and ICICI Prudential.

Related websites,

Past records of ICICI Prudential.&

Brochures and pamphlets of ICICI Prudential

Sampling:

a) Population : People of Hubli city

b) Size : 100 size

c) Method : Random sampling

Need for study:

After the crises all over world market condition are critical so I am study because

of what is impact on life insurance.

Scope of study:

The scope of study is limited to Hubli city and the sample size is 100

BABASAB PATIL

2


3/71


4/71


Suggestions:

Continuous bombardment of Advertisement by ICICI Prudential as a Life Insurance

Company for a common man as well as for well educated and good salaried people.

The company has concentrate increases on premium 20000-50000.

Look for the way to make customer highly satisfied with respect to returns.

Premium and initial charges to be reworked as, the customer is dissatisfied with there.

Conclusion

Every study and project needs to be concluded. Hence, based on the study of

ICICI Prudential and its products in brief, and also conducting a survey on the customers and

advisors sales function towards the products offered and services provided by ICICI

Prudential, I have arrived on a conclusion that

ICICI Prudential Lifes market share stood at 11.8%, for 10-month ended January 31,

2009, making it the leading private life insurance player. As on January 31, 2009, the

companys assets under management (AUM) stood at Rs 28,515 crore. The company also has

one of the largest distribution networks amongst private life insurers in India with over 2,100

branches (including 1,116 small-offices in rural India), an advisor base of over 2,90,000 and

18 banc assurance partners, as on January 31, 2009. Since inception, ICICI Prudential Life

has sold over 90 lakh policies.

BABASAB PATIL

4


5/71


6/71


retail + group new business premiums and has underwritten over 5 million policies since

inception. The company has a network of over 680 offices, over 235,000 advisors; as well as

23 bank partners. It is also the only life insurer in India to be assigned AAA (Ind) credit

rating from Fitch Ratings. For the past six years, ICICI Prudential has retained its position as

the No. 1 private life insurer in the country, with a wide range of flexible products that meet

the needs of the Indian customer at every step in life. To know more about the company

LIFE INSURANCE:

Life insurance can be defined as Life Insurance provides a sum of money if the

person who is insured dies while the policy is in effect.

Life insurance is a product that helps you protect your dependents from financial

difficulties in the unfortunate event of your death or disability depriving them of the financialsupport that they get today. When you buy a life insurance policy, essentially you enter into a

contract with an insurance company under which you promise to make periodic payments to

it (the premium). The insurance company in return promises to pay to your nominee's sum of

money upon your death or upon occurrence of the events specified in the contract.

Usually the contract provides for

Payment of an amount, on the date of maturity or at specified periodicintervals or at death, if it occurs earlier.

Periodical payment of insurance premium by the assured, to the corporation

who provides the insurance.

INSURANCE MARKET IN INDIA:

India with about 200 million middle class household shows a huge untapped potential

for players in the insurance industry. Saturation of markets in many developed economies has

made the Indian market even more attractive for global insurance majors. The insurancesector in India has come to a position of very high potential and competitiveness in the

market. Innovative products and aggressive distribution have become the say of the day.

Indians, have always seen life insurance as a tax saving device, are now suddenly turning to

the private sector that are providing them new products and variety for their choice.

Life insurance industry is waiting for a big growth as many Indian and foreign companies are

waiting in the line for the green signal to start their operations. The Indian consumer should

BABASAB PATIL

6


7/71


be ready now because the market is going to give them an array of products, different in

price, features and benefits. How the customer is going to make his choice will determine the

future of the industry.

The insurance industry in India can broadly classified in two parts. They are,

Life insurance.

Non-life (general) insurance.

BRIEF HISTORY OF INSURANCE

The business of insurance started with marine business. The first insurance policy was

issued in 1583 in England.

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

1818: -The British introduce to India, with the establishment of the Oriental Life Insurance

Company in Calcutta.

1850: - Non life insurance debuts, with Triton Insurance company.

1870: - Bombay Mutual Life Assurance Society is the first India-owned life insurer.

1907: - Indian Mercantile Insurance is the first Indian non-life insurer.

1912: -The Indian life assurance Companies act enacted to regulate the life insurance

business.1938: - The insurance act, which forms the basis for most current insurance laws, replaces

earlier act.

1956: - Life insurance nationalized, government takes over 245 Indian and foreign insurers

and provident societies.

1972: - Non Life insurance nationalized, GIC set up.

1993: - Malhotra Committee, headed by former BBI governor R.N. Malhotra, set up to draw

up a blue print for insurance sector reforms.1994: -Malhotra Committee recommends re-entry for private players, autonomy to PSU

insurers.

1997:-Insurance regulator IRDA (Insurance Regulatory and Development Authority) set up.

2000:-IRDA starts giving licences to private insurers, ICICI Prudential and HDFC Standard

Life first private insurers to sell a policy.

2002:- Banks were allowed to sell insurance plans, as TPAs enter the scene, insurers start

settling non-life claims in the cashless mode.

BABASAB PATIL

7


8/71


Need for study:

After the crises all over world market condition are critical so I am study because

of what is impact on life insurance.

Scope of study:

The scope of study is limited to Hubli city and the sample size is 100

Objectives of the Study:

To know aware of investing in ULIPs and Traditional plans

To Study and Compare the Traditional Life Insurance Plans and ULIPs with

respect to ICICI Prudential life Insurance.

To know the factors influence while purchasing life Insurance plans.

To know the factors influence while purchasing the particular category of plan

BABASAB PATIL

8


9/71


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 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.

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 IRDAs

online service for issue and renewal of licenses to agents.

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, which are expected to be introduced by early next year.

Since being set up as an independent statutory body the IRDA has put in a framework

of globally compatible regulations. In the private sector 14 life insurance and 9 general

insurance companies have been registered

Objective of IRDA:

The main objectives of IRDA are:

To take care of the policy holders interest

To open up the insurance sector for private sector

To ensure continued financial soundness and solvency

To regulate insurance and reinsurance companies

To eliminate dishonesty and unhealthy competition

To supervise the activities of the intermediaries

To amend the insurance act ,lic act and the general business nationalization act.

BABASAB PATIL

9


10/71


Duties and Power of IRDA:

To regulate ,promote and ensure orderly growth of the insurance business

To exercise all the powers and functions of the controller of insurance

To protect the interest of the policy holders in settlement of claims and terms and

conditions of policies

To promote and regulate professional organizations connected with insurance

business.

To regulate ,promote and ensure orderly growth of the insurance business

To exercise all the powers and functions of the controller of insurance

To protect the interest of the policy holders in settlement of claims and terms and

conditions of policies

To promote and regulate professional organizations connected with insurance

business.

To regulate investment of funds

To regulate margin of solvency

To adjudicate disputes between insurers and intermediaries

FUNCTIONS OF IRDA:

Issue to the applicant a certificate of registration, renew, modify, withdraw, suspend

or cancel such registration;

Protection of the interests of the policy holders in matters concerning assigning of

policy, nomination by policy holders, insurable interest, settlement of insurance claim,

surrender value of policy and other terms and conditions of contracts of insurance;

BABASAB PATIL

10


11/71


Specifying requisite qualifications, code of conduct and practical training for

intermediary or insurance intermediaries and agents;

Specifying the code of conduct for surveyors and loss assessors;

Promoting efficiency in the conduct of insurance business;

Promoting and regulating professional organizations connected with the insurance and

re-insurance business;

Levying fees and other charges for carrying out the purposes of this Act;

Specifying the form and manner in which books of account shall be maintained and

statement of accounts shall be rendered by insurers and other insurance

intermediaries.

Regulating investment of funds by insurance companies;

Regulating maintenance of margin of solvency;

Adjudication of disputes between insurers and intermediaries or insurance

intermediaries.

Supervising the functioning of the Tariff Advisory Committee;

Specifying the percentage of premium income of the insurer to finance schemes for

promoting and regulating professional organizations referred to in clause.

Specifying the percentage of life insurance business and general insurance business to

be undertaken by the insurer in the rural or social sector

BABASAB PATIL

11


12/71


INTRODUCTION TO ULIP:

The concept of ULIP came in to existence in 1960s to provide an optimum balance

between protection and investment.

ULIP distinguishes itself through the multiple benefits it provides to the

policyholders. These plans are designed with a view to help the customers to utilize the

market opportunities by investing in the share market, capital market and at the same time

have the facility of Death Benefit and Maturity Benefit.

Unit-linked life insurance products are those where the benefits are expressed in terms

of number of units and unit price. They can be viewed as a combination of insurance and

mutual funds.

The number of units that a customer would get would depend on the unit price when

he pays his premium. The daily unit price is based on the market value of the underlying

assets (equities, bonds, government securities, et cetera) and computed from the net asset

value.

The advantage of unit-linked plans is that they are simple, clear, and easy to

understand. Being transparent the policyholder gets the entire upside on the performance of

his fund. Besides all the advantages they offer to the customers, unit-linked plans also lead to

an efficient utilization of capital.

Unit-linked products are exempted from tax and they provide life insurance. Investors

welcome these products as they provide capital appreciation even as the yields on

government securities have fallen below 6 per cent, which has made the insurers slash

payouts.

According to the IRDA, a company offering unit-linked plans must give the investor

an option to choose among debt, balanced and equity funds.

If you choose a debt plan, the majority of your premiums will get invested in debt securities

like gilts and bonds. If you choose equity, then a major portion of your premiums will be

invested in the equity market. The plan you choose would depend on your risk profile and

your investment need.

BABASAB PATIL

12
http://www.personalfn.com/insurance/productarena/endowmentplan.htmlhttp://www.personalfn.com/insurance/productarena/endowmentplan.html


13/71


The ideal time to buy a unit-linked plan is when one can expect long-term growth

ahead. This is especially so if one also believes that current market values (stock valuations)

are relatively low.

So if you are opting for a plan that invests primarily in equity, the buzzing market

could lead to windfall returns.

If one invests in a unit-linked pension plan early on, say when one is 25, one can

afford to take the risk associated with equities, at least in the plan's initial stages. However, as

one approaches retirement the quantum of returns should be subordinated to capital

preservation. At this stage, investing in a plan that has an equity tilt may not be a good idea.

Considering that unit-linked plans are relatively new launches, their short history does

not permit an assessment of how they will perform in different phases of the stock market.

Even if one views insurance as a long-term commitment, investments based on performance

over such a short time span may not be appropriate.

Simply put, ULIPs work very similar to a mutual fund with a life cover thrown in.

They have a mandate to invest the premiums in varying proportions in gsecs (government

securities), bonds, the money markets (call money) and equities. The primary difference

between conventional savings-based insurance plans like endowment and ULIPs is the

investment mandate- while ULIPs can invest upto 100% of the premium in equities, the

percentage is much lower (usually not more than 15%) in case of conventional insurance

plans. ULIPs are also available in multiple options like `aggressive' ULIPs (which can invest

upto 100% in equities), `balanced' ULIPs (which invest 40-60% in equities) and `debt' ULIPs

(which invest only in debt and money market instruments).

The exact expense structure/ break-up for ULIPs is as transparent as one would have

liked. Broadly speaking, ULIP expenses are classified into three major categories:

1) Mortality Charges:

Mortality expenses are charged by life insurance companies for providing a life cover to the

individual. The expenses vary with the age, sum assured and sum-at-risk for the individual.

There is a direct relation between the mortality expenses and the above mentioned factors. In

BABASAB PATIL

13


14/71


a ULIP, the sum-at-risk is an important reference point for the insurance company. Put

simply, the sum-at-risk is the difference between the sum assured and the investment value

the individual's corpus as on a specified date.

2. Sales and administration expenses:

Insurance companies incur these expenses for operational purposes on a regular basis. The

expenses are recovered from the premiums that individuals pay towards their insurance

policies. Agent commissions, sales and marketing expenses and the overhead costs incurred

to run the insurance business on a day-to-day basis are examples of such expenses.

3. Fund management charges (FMC):These charges are levied by the insurance company to meet the expenses incurred on

managing the ULIP investments. A portion of ULIP premiums are invested in equities,

bonds, gases and money market instruments. Managing these investments incurs a fund

management charge, similar to what mutual funds incur on their investments. FMCs differ

across investment options like aggressive, balanced and debt ULIPs; usually a higher equity

option translates into higher FMC.

Apart from the three expense categories mentioned above, individuals may also have

to incur certain expenses, which are primarily `optional' in nature- the expenses will be

incurred if certain choices that are made available to individuals are exercised.

a) Switching charges:

Individuals are allowed to switch their ULIP options. For example, an individual can switch

his fund money from 100% equities to a balanced portfolio, which has say, 60% equities and

40% debt. However, the company may charge him a fee for `switching'. While most life

insurance companies allow a certain number of free switches annually, a switch made over

and above this number is charged.

b) Top-up charges:

ULIPs allow individuals to invest a top-up amount. Top-up amount is paid in addition to the

premium amount for a particular year. Insurance companies deduct a certain percentage from

the top-up amount as charges. These charges are usually lower than the regular charges that

are deducted from the annual premium.

BABASAB PATIL

14


15/71


c) Cancellation charges:

Life insurance companies levy cancellation charges if individuals decide to surrender their

policies (usually) before three years. These charges are levied as a percentage of the fund

value on a particular date.

Having defined ULIP expenses, an illustration will help in understanding how they pan out as

well as their impact on returns over a period of time.

NAV concept:

It exhibits the value (or the price) that one has for his investment or one will have to

pay for his investment.

As, the investment made by different people are different, the value (or the price) is

the expressed in per unit terms. It helps in knowing the value of Insurance at any point of

time.

Technical Calculation of NAV: -

UNIT Value = (Total market Value of all assets invested less expenses related to

Investment management / Total no.of outstanding units)

Factors affecting NAV:

Marketing Value of investment portfolio, Number of Units, Expenses and InvestmentIncome.

Ex: If 2,00,000 /- has been accumulated in the equity fund and the no. of units issued is

10,000 /- then the NAV of the equity fund is: -

2,00,000 / 10,000 = Rs 20 / -

As the equity market develop the fund grows from 2,00,000 / - to 220,000/-

Now the NAV = 2,20,000 / 10,000 = Rs 22 / -

If among these 10,000 units the policyholder has 5000 units ten the value of investment as of

now is Rs 1,10,000.

Thus a unit linked plan actually tells, what is the value of the fund.

BABASAB PATIL

15


16/71


BASIC FEATURES OF ULIP

1. Life protection

2. Investment and savings

3. Flexibility

4. Transparency

5. Added Benefits

a) Death due to accident

b) Any kind of disability

c) Critical illness

d) Surgeries

6. Liquidity7. Tax Planning

1) LIFE PROTECTION

Start

Working

Start a

Family

Children

Establishi

ng Career

Retiremen

t Time

The graph shows the various needs of the customer at different point of time,

individuals needs differ and his need for life protection fluctuates. ULIP satisfies the

varying needs of the customer providing him with more and more protection as and

when he requires, by allowing the policyholder to increase or decrease the death

benefit. It is usually multiple of the contribution being paid which ensure that the

contribution is adequate enough to provide life protection. And is also able to

maintain a same balance between protection and savings.

BABASAB PATIL

16


17/71


18/71


unable to pay a particular premium due. On returning from the premium

holiday the client can pay the previous premiums if he desires or continue

from that date.

d) Choice of fund.

There are four kinds of funds available for a client of ULIP. He has a option to

switch between these four funds. He can either choose only one or invest in all

four depending on his risk tolerance.

Switch between the funds

The policyholder has a choice two reallocate the premium paid by him on

every premium policy anniversary. He can switch between the above four

funds to avail the advantages of market fluctuations.

Table: Kinds of funds available for a client of ULIP

e) Top ups:

Some times the client may have surplus amount after his expenses. ULIP

allows him to save that amount the investing in the insurance he can avail the

benefit of top up by paying extra premium, which will be invested in the share

BABASAB PATIL

Plan Plan objective Risk Investment pattern

Maximiser

(Growth)

High growth and capital

appreciation over a long

terms

High Equity and equity related

securities: Max 90%, Debt,

money market and cash : Min

10%

Balancer

(balanced)

Balance of capital

appreciation and study

returns over a long terms

Average Equity and equity related

securities: Max 40%, Debt,

money market and cash : Min

60%

Preserver Equal balance of capital

appreciation and study

returns over a long term

Low Debt instrument: Max 50%

Money market and cash Min

50%

Protector

(Income)

Study returns over a long

term.

Moderate Debt instrument: Max 100%

Money market and cash Max

25%

18


19/71


market by the insurer company. The client gets expert fund management. The

policyholder is allowed to do as many top ups in the tenure of plan.

f) Premium redirection

The policyholder is allowed to reallocate the premium paid each time to

different fund structure. Thus whenever the premium is due (As per the

premium payment mode), he can redirect the current premium into different

asset allocations than the previous time. This helps the policyholder to

optimize the funds in accordance to market with out using the switch option.

g) Assignment option:The policyholder can assign the policy to any of the nominee or any bank in

case he has taken a loan on the title of the policy. Unfortunately if something

happens to the policyholder then the insurer will repay the loan taken by the

client to the extent of premium paid.

4. Transparency:

ULIP products are transparent in terms of, the policyholder is aware of where

his contribution is being allocated. The policyholder is aware of the various charges

charged to him.

The Various charges of the ULIP are: -

a) Contribution related Charges- Running expenses of the policy

b) Administrative Charges- Issuance cost, distribution costs etc

c) Fund Management Fee- cost of being and selling the various financial instruments

for various funds.

d) Mortality Charges: cost of providing life protection

e) Rider charges: cost of other protection charges.

f) Surrender charges: cost to cover initial expenses

g) Bid offer charges: difference between the offer price of units and the selling price

i.e. bid price of units. It covers the cost of selling the policy.

h) Transaction specific charges: cost of changing funds, toping up the investment

component or withdrawals

BABASAB PATIL

19


20/71


Daily NAV: A feature that lets you know on a daily bases, how the money in

insurance plan is growing.

5. ADDED BENEFITS:

To get extra protection from the 3D effect ULIP provides the policyholder the

advantage of rider attachments.

a. Death due to accident (ADBR)

b. Disability (ABR)

c. Critical Illness (CIBR)

d. Surgeries (MSAR) (Now discontinued)

6. LIQUIDITY:

The feature makes ULIP a marketable plan. The policyholder has an option of

withdrawals in case if need arises. ULIP provides easy access to the money as and when the

policyholder may requires. There are two types of withdrawal options.

a) Partial

b) complete

The value of withdrawal reduces the death benefit by same amount. This facility can

be avail only after three full premium payment years are completed. The minimum worth of

this units and a maximum where in at least Rs. 10000/- worth units remain in all the funds

put together.

7. TAX PLANNING

This is another feature of ULIP. This is one of the motives of the policy holder to

invest in the insurance plans. They usually invest to avail the tax benefit. Regulation in

India allows tax benefits in the contribution paid under section 88, contribution paid for

health riders critical illness and major surgical is allowed tax benefits under section 80D, as

per the prevailing tax laws.

Maturity benefits are tax free under section 10(10)D, provided life come is at least 5

times of the annual contribution paid.

Death benefit is tax free under section 10(10)d.

Whit so many tax benefits available in one instrument ULIP tends to be an intelligent tax-

planning tool.

BABASAB PATIL

20


21/71


Modes of Premium Payment:Premiums are payable through any of the following modes:

Cash*

Cheques

Demand Drafts

Pay Orders

Bankers Cheque

Internet facility as approved by the Company from time to time.

Electronic Clearing System

Credit Cards (Only standing instruction)

*Amount and Modalities will be subject to company Rules and relevant

legislation/regulations

Premium Payment frequency:

Your Premium will fall due in every policy year based on the periodicity of payment of

premiums, i.e.

Yearly,

Half-Yearly or

Monthly

BABASAB PATIL

21


22/71


How much does the coverage cost?

The most comprehensive coverage is also affordable. Below are the annual premium rates for

a Sum Assured of Rs. 500,000 for various policy terms and entry ages for Males.

Age(Years) Policy Term

15 years 20 years 25 years

25 Rs. 2435 Rs. 2474 Rs. 2734

30 Rs. 2896 Rs. 3204 Rs. 3738

35 Rs. 4106 Rs. 4724 Rs. 5576

40 Rs. 6282 Rs. 7281 Rs. 8442

45 Rs. 9804 Rs. 11,182 Rs. 12,554

Premium in Rupees

The premiums are guaranteed for first five years from the date of commencement of the

policy. Thereafter, the premiums are annually reviewable. Any change in premium will only

be effected with approval from IRDA.

Above premiums are inclusive of modal rebate and Large SA discount & exclusive of any

service tax and education cess.

Waiting Period: No benefit in respect of Critical Illness Benefit (CIB) or Total &

Permanent Disability Benefit (TPDB) will be payable if it has occurred due to sickness within

the first 6 months of the policy or first 3 months of the policy reinstatement date where the

policy has lapsed formore than 3months.

BABASAB PATIL

22


23/71


What is your Human Life Value?

Beyond all doubt, your life is invaluable. Yet, there is a certain worth that can be attributed to

the financial support you offer your parents, spouse or children. This worth is referred to as

Human Life Value (HLV). In the future, if your family does not have the protective blanket

of your presence, they will no longer be able to enjoy the benefits of the income you earned.

Put simply, Human Life Value is the present value of your future earnings.

Why should you calculate your Human Life Value?

You should calculate your Human Life Value so you can accordingly invest in insurance

plans that provide your family with adequate finances and hence security even in your

absence.

How do you determine your Human Life Value?

Your Human Life Value is determined by 3 factors:

1. Your age

2. Current and future expenses

3. Current and future income

As a thumb rule, if you are 30 years of age, you should insure yourself for an amount

approximately 8 times your annual income. At 35, your investment should be close to 6 times

your income. Of course, the exact amount of your investment should be determined by the

number of people who depend on you, your existing investments and your life stage. For

example, if you are 30 years of age and have two children and parents to provide for, the

amount you invest should be reflective of your requirements.

Calculate your Human Life Value NOW

BABASAB PATIL

23


24/71


Use our quick and easy Human Life Value Calculatorto determine your Human Life Value

and the corresponding amount you should invest. Start right away!

WORKING OF A ULIP PLAN

BABASAB PATIL

24

This is the Investment a/c. The units that are bought with the premium, which one haspaid, first take care of the protection and the remaining amount is put in your Investmentaccount. Here are the various options of investments as per ones choice and priorities.This is the account where the money grows over a long period of time.

Life rime regular PremiumLife rime regular Premium

AllocatedPremium

AllocatedPremium

Part of the Premiumtowards the policyExpenses

Part of the Premiumtowards the policyExpenses

Allotment of Units Allotment of Units

InsuranceCharges

InsuranceCharges

This goesto theProtection

a/c toprovideagainstthe 3DEffect

This goesto theProtectiona/c to

provideagainstthe 3DEffect

VariousInvestmentOptions. Facilityof withdrawalsand investing

back in theInvestment

VariousInvestmentOptions. Facilityof withdrawalsand investingback in the

Investment

Units that build up theinvestment value

Units that build up theinvestment value
http://172.16.53.38/public/Tools/Calculators/Calculator/Protection-Current-Situation-Calc.htmhttp://172.16.53.38/public/Tools/Calculators/Calculator/Protection-Current-Situation-Calc.htm


25/71


For Example

A client put in regular contribution of Rs. 20,000 /-. From this amount a % is deducted as

contribution.

Therefore if the contribution related expense is 20% - Rs.4000/- will be deducted as

contribution charges.

The amount that is now available is Rs.20000-4000=16000/-

Now, if the client who is available is aged 30 years were to take a life cover of 500,000/- then

mortality (1.50/- per thousand at the age of 30) charge of 750 /- will be deducted.

This amount will provide life cover to the policy. The remaining amount of 15,250/- will be

invested in any one of them or all of them.

The Investment is shown in terms of units. Thus if client invests in debt fund and the NAV of

the debt fund is Rs. 16/-(market price) then the no. of units that the client will get is

15,250/16=953.125. For this investment-fund management fee will be charged and the

charges for maintaining the policy an administrative charge are levied.

He same example would look as follows in a chart.

BABASAB PATIL

25


26/71


FLOW CHART OF A UNIU LINKED PLAN

Less 20%

20,000-4000=16000

16,000-750=15,250

for the age 30- mortality at 1.50

per thousand

15,250/- invested in debt fund

at a NAV of 16/-

953.1250units allocated

NAV of debt fund 16/- per unit

BABASAB PATIL

26

Contribution Contribution relatedcharges deducted

Mortality & RiderCharges deucted

The client investsresultant in funds as

Units

Represented as NAV

Life Protection500,000

Investment inFunds

Debt / Equity orbalanced


27/71


TRADITIONAL PLANS:

These are the oldest types of plans available. These plans cater to customers with a low risk

appetite. Some of the common features of traditional plans are:

1. Steady Investment

1. Major chunk of investible funds are in debt instruments

2. Steady and almost assured returns over the long term

2. Features

1. Death benefit is Sum Assured + guaranteed & vested bonus

2. Helps in asset creation as they are for a long tenure3. Premium to Sum Assured ratios are fixed for each plan and age.

Traditional plans have existed since the inception of Insurance. These plans have been

providing the policyholders, advantages of savings and protection.

But they lack, transparency, flexibility and liquidity etc that are available in either

Investment avenues. Ever since the Insurance sector was opened up, private players have

been trying to entice the customer with new and innovative policies.

Unlike traditional Insurance products, customers find unit linked plans more

transparent, flexible and easy to understand.

The key to good financial goals, risks appreciated and portfolio mix. The next step

would be allocate asset across different categories and systematically adhere to an investment

pattern, so that they work in tandem to meet ones requirements over the next month, year or

decade. Because of their flexibility to adjust to different life stage needs ULIPs have an

upper hand over the traditional plans.

Buying an ULIP is quite different from buying a traditional Life Insurance product.

The policyholder is totally aware of the various charges being charged to him and also about

was his contribution is being invested.

Ex: If 2,00,000 /- has been accumulated in the equity fund and the no. of units issued is

10,000 /- then the NAV of the equity fund is: -

2,00,000 / 10,000 = Rs 20 / -

As the equity market develop the fund grows from 2,00,000 / - to 220,000/-

BABASAB PATIL

27


28/71


Now the NAV = 2,20,000 / 10,000 = Rs 22 / -

If among these 10,000 units the policyholder has 5000 units ten the value of investment as of

now is Rs 1,10,000.

Thus a unit linked plan actually tells, what is the value of the fund.

COMPARISON BETWEEN TRADITIONAL AND ULIP

Broadly, insurance plans can be distinctly divided into ULIPs and traditional plans. A

brief detail of both segments:

Unit Linked Insurance Product: ULIPs have gained high acceptance due toattractive features they offer. These include:

1. Flexibility

1. Flexibility to choose Sum Assured.

2. Flexibility to choose premium amount.

3. Option to change level of Premium /Sum Assured even after the plan has

started.

4. Flexibility to change asset allocation by switching between funds

2. Transparency:

1. Charges in the plan & net amount invested are known to the customer.

2. Convenience of tracking ones investment performance on a daily basis.

3. Liquidity:

1. Option to withdraw money after few years (comfort required in case ofexigency).

2. Low minimum tenure.

3. Partial / Systematic withdrawal allowed.

4. Fund Options.

5. A choice of funds (ranging from equity, debt, cash or a combination).

6. Option to choose your fund mix based on desired asset allocation.

BABASAB PATIL

28


29/71


COMPANY PROFILE

Evolution of ICICI Prudential Life Insurance:

ICICI Prudential Life Insurance today announced that Emgee Muthoot, the Insurance

division of the Muthoot group, one of Kerala's largest banking and financial services groups,

has crossed the Rs 10 crore premium mark in a span of less than three years. Emgee Muthoot,

which began distributing ICICI Prudential's life insurance products under the corporate

agency relationship, has also emerged as ICICI Pru's largest non-bank partnership in the state.

ICICI Prudential Life Insurance pioneered the multi-channel distribution strategy in the

country, and Kerala has emerged as one of its most successful examples of this model. The

company has tied up with leading banks in the state, like Federal Bank and The South Indian

Bank, as well as some other strong retail financial services distributors such as Emgee

Muthoot. Each of these are key partners in ICICI Prudential's alternate distribution strategy

and contribute greatly to the company's business as well as awareness levels and customer

experience.

Speaking at the event, Ms Shikha Sharma, CEO & MD, ICICI Prudential Life

Insurance said, ''It's been wonderful to see the evolution of Emgee Muthoot into a diversified

financial services company. Ever since they decided to become corporate agents and

distribute our life insurance products in February 2002, they have made huge strides in

training and developing their workforce to sell a complex product like life insurance, and

deliver value to their customers. I believe that it is thanks to these efforts that they are today

not only our leading corporate agent in Kerala, but the second largest in the country''.

Mr. George Alexander Muthoot, Managing Director, the Muthoot group, said ''A few

years ago, we took a strategic decision to leverage our extensive branch network and thereby

expand the scope of the services we offer our customers. Our partnership with ICICI

Prudential has been fantastic, and today life insurance has become a core business for us. I

believe that the success of this relationship has been founded on our shared values and

mission to deliver a superior experience to our customers''.

Emgee Muthoot is one of the most successful corporate agents for ICICI Prudential, and has

been one of the frontrunners in the company's Partner Program, an initiative to strengthen

relationships with key partners. The group's strategic move towards a branch model of

BABASAB PATIL

29


30/71


distribution in mid-2003 served as a catalyst for the group's life insurance foray, and the

company has earned over Rs 5 crore in premium income since the beginning of this financial

year alone.

ICICI Prudential's early start and continued focus on alternate channels, which

include bank tie-ups, corporate agents and brokers, has resulted in these channels contributing

nearly 30% of ICICI Prudential's new business. Currently, ICICI Prudential has 7 bank

relationships and over 150 corporate agency and broker tie-ups.

Overview:

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank -

one of India's foremost financial services companies-and Prudential plc - a leading

international financial services group headquartered in the United Kingdom. Total capital

infusion stands at Rs. 47.80 billion, with ICICI Bank holding a stake of 74% and Prudential

plc holding 26%.

We began our operations in December 2000 after receiving approval from Insurance

Regulatory Development Authority (IRDA). Today, our nation-wide team comprises of 2099

branches (inclusive of 1,116 micro-offices), over 276,000 advisors; and 18 bancassurance

partners.

ICICI Prudential is the first life insurer in India to receive a National Insurer Financial

Strength rating of AAA (Ind) from Fitch ratings. For three years in a row, ICICI Prudential

has been voted as India's Most Trusted Private Life Insurer, by The Economic Times - AC

Nielsen ORG Marg survey of 'Most Trusted Brands'. As we grow our distribution, product

range and customer base, we continue to tirelessly uphold our commitment to deliver world-

class financial solutions to customers all over India.

Mumbai, September 3, 2007: ICICI Prudential Life Insurance, India's leading private

life insurance company, has simultaneously crossed 2 significant milestones, further

strengthening its position as a market leader. It has become the first private life insurer to

cross the 5 million policies mark, a milestone that has pushed the company's assets held past

the 20,000 crore milestone. Each of these achievements reflect the trust retail investors have

reposed in the company as well as the immense reach that the company has been able to build

over the past few years, particularly the last 18 months

BABASAB PATIL

30


31/71


The ICICI Prudential Edge:

The ICICI Prudential edge comes from our commitment to our customers, in all that

we do - be it product development, distribution, the sales process or servicing. Here's a peek

into what makes us leaders.

1. Our products have been developed after a clear and thorough understanding of customers'

needs. It is this research that helps us develop Education plans that offer the ideal way to truly

guarantee your child's education, Retirement solutions that are a hedge against inflation and

yet promise a fixed income after you retire, or Health insurance that arms you with the funds

you might need to recover from a dreaded disease.

2. Having the right products is the first step, but it's equally important to ensure that our

customers can access them easily and quickly. To this end, ICICI Prudential has an advisor

base across the length and breadth of the country, and also partners with leading banks,

corporate agents and brokers to distribute our products .

3. Robust risk management and underwriting practices form the core of our business. With

clear guidelines in place, we ensure equitable costing of risks, and thereby ensure a smooth

and hassle-free claims process.

4. Entrusted with helping our customers meet their long-term goals, we adopt an investmentphilosophy that aims to achieve risk adjusted returns over the long-term.

5. Last but definitely not the least, our team is given the opportunity to learn and grow, every

day in a multitude of ways. We believe this keeps them engaged and enthusiastic, so that they

can deliver on our promise to cover you, at every step in life.

OUR VISION, MISSION QUALITY POLICY

To be the dominant Life, Health and Pensions player built on trust by world-class people

and service

This we hope to achieve by:

Understanding the needs of customers and offering them superior products and

service

Leveraging technology to service customers quickly, efficiently and conveniently

BABASAB PATIL

31


32/71


Developing and implementing superior risk management and investment strategies to

offer sustainable and stable returns to our policyholders

Providing an enabling environment to foster growth and learning for our employees

And above all, building transparency in all our dealings

The success of the company will be founded in its unflinching commitment to 5 core

values -- Integrity, Customer First, Boundaryless, Ownership and Passion. Each of the values

describe what the company stands for, the qualities of our people and the way we work.

We do believe that we are on the threshold of an exciting new opportunity, where we can

play a significant role in redefining and reshaping the sector. Given the quality of our

parentage and the commitment of our team, there are no limits to our growth.

Our values:

Every member of the ICICI Prudential team is committed to 5 core values: Integrity,

Customer First, Boundaryless, Ownership, and Passion. These values shine forth in all we do,

and have become the keystones of our success.

Promoters:

ICICI Bank Limited (NYSE:IBN) is India's largest private sector bank and the

second largest bank in the country with consolidated total assets of about US$ 95 billion as of

March 31, 2009. ICICI Banks subsidiaries include Indias leading private sector insurance

companies and among its largest securities brokerage firms, mutual funds and private equity

firms. ICICI Banks presence currently spans 19 countries, including India.

Prudential:

Established in London in 1848, Prudential plc is a leading internal retail financial

services group with significant operations in Asia, the US and the UK. Prudential has been

writing protection and savings insurance for over 160 years, and today has more than 21

million customers worldwide and over 249 billion in assets under management (as of

December 31, 2008). In Asia, Prudential is the leading Europe-based life insurer with

operations in China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, the Philippines,

Singapore, Taiwan, Thailand, and Vietnam. Prudential is one of the largest asset management

companies in terms of overall assets sourced in Asia ex-japan, with ?36.8 billion funds under

BABASAB PATIL

32


33/71


management (as of December 31, 2008) and operations in ten markets including China, Hong

Kong, India, Japan, Korea, Malaysia, Singapore, Taiwan, Vietnam and United Arab

Emirates.

The Company

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a premier

financial powerhouse, and Prudential plc, a leading international financial services group

headquartered in the United Kingdom. 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).

ICICI Prudential Life's capital stands at Rs. 4,780 crores (as of March, 2009) with ICICI

Bank and Prudential plc holding 74% and 26% stake respectively. For the period April 1,

2008 to March 31, 2009, the company has posted a growth of 13%, garnering total received

premium (new business + renewal) of Rs 15,356 crores as against Rs 13,563 crores in

FY2008 and has underwritten over 9 million policies since inception. The company has assets

held over Rs. 32,000 crores as on March, 2009.

ICICI Prudential Life is also the only private life insurer in India to receive a National Insurer

Financial Strength rating of AAA (Ind) from Fitch ratings. The AAA (Ind) rating is the

highest rating, and is a clear assurance of ICICI Prudential's ability to meet its obligations to

customers at the time of maturity or claims.

For the past eight years, ICICI Prudential Life has retained its leadership position in the life

insurance industry with a wide range of flexible products that meet the needs of the Indian

customer at every step in life.

BABASAB PATIL

33


34/71


STAGES IN POLICY ISSUANCE:

Proposal

A Proposal Stage is the First stage before the policy is issued at COPS. At this stage, the

application form is received by COPS, but it is pending for issuance due to further

clarifications required from the customer.

Login

A proposal, which is complete i.e., duly filled with all necessary documents

attached to it & accepted by the Branch ops, is called a Login

Reject

An Application gets rejected at the Branch Ops level due to necessary details not filled in

the form or necessary documents not submitted are a Reject. It is then sent back to the

Advisor for completion.

Issuance

Issuance means a policy that is issued to the Customer by Central Ops.

Decline Status

When a customer refuses to take a policy post login but before Issuance is called a

Decline

Cancellation

When the cheque given by the customer bounces, it amounts to cancellation of the policy.

Lapse

A policy for which the Customer fails to pay subsequent premiums is a Lapsed Policy.

Free look

Post issuance of the policy, the policyholder has the option to turn down the policy within

15 days from the date of issuance. This period of 15 days is called Free look Period.

Surrender When a customer wants to discontinue with the policy it is called

Surrender.

BABASAB PATIL

34


35/71


Distribution Channels:

Tied Agency Channel

The Tied Agency Channel, as the name suggests, is driven by agents (advisors) of the

company. For insurance distribution, this is the most popular channel. This channel sourced

73% of ICICI Prudentials business in FY 2004.

Bank assurance:

Bank assurance is a setup whereby a tie up is made with a Bank. This distribution model

works on referral basis. The customer base of the bank that is made available to it benefits the

Insurance Company. The bank, in return earns referral commission for every policy issued to

the bank customer. In this arrangement, typically an employee of the ICICI Prudential is

stationed at the bank branch and he sources the business through walk-ins that happen at thebank. His domain of prospective customers is a banks customer. Such agents put up at

banks are called as Financial Service Consultant (FSC). Banc assurance, as an arrangement

for distribution, has been proved successful because of the extended reach that the insurance

company gets through the bank branch network.

Corporate Agents:

Corporate Agents (CAs) are corporate entities that source policies for the Insurance

Company with whom they have a tie-up. They are authorized to source policies for oneinsurance company only. The difference between CA & Banc assurance arrangement is that

the former trains its own employees to sell the policies while in case of Banc assurance

arrangement, the employees of the insurance company (FSCs) source the business.

Brokers:

A variant of CAs, Brokers are not tied to a particular company and are allowed to source

business for more than one insurance company.

Direct Marketing:

Direct marketing, as a channel of distribution, is relatively a new one. It basically

encompasses all unconventional channels of distribution. Inter alia, it includes call center,

Internet and other mass media channels. All leads that come through this channel are then

attended and closed by our branches.

Advisor: An Advisor is the agent of the Company who sources or sells the policy for the

company. They are called as FOS - Feet on Street.

INSURANCE PRODUCT AND SERVICE:

BABASAB PATIL

35


36/71


ICICI Prudentials ultimate promise is financial security. A strong brand certainly

boosts sale, but without customer-friendly, innovative products, even the best brand would

not last long. ICICI Prudentials product range has been developed on the understanding that

different people have their own sets of needs at various stages of their lives. It has thus built a

flexible portfolio of products that can be customized to cater to varying needs of people at

each stage, and thus ensure protection in every step of life. The companys philosophy has

been to help customers understand their financial needs and work closely with them to

customize a product that would meet. Advisors can offer a complete range of products

Savings plans, Child plans, Market-linked plans, Protection plans, and Retirement plans and

tailor a flexible solution to meet customers changing needs at every stage of life. In fact,

ICICI Prudential was the first to un-bundle product benefits, pioneering the concept ofriders and soon after introduce comprehensive market-linked and retirement plans. ICICI

Prudential has launched a handful of products that are analyzed below: ICICI Prudential's life

insurance products may be loosely categorized under three forms: pure life insurance

products without an investment angle to them; a product that is a mix of a cumulative

investment scheme and an insurance product; and, finally, standard products such as money-

back and endowment policies.

PRODUCTS:

Insurance Solutions for Individuals

ICICI Prudential Life Insurance offers a range of innovative, customer-centric products that

meet the needs of customers at every life stage. Its products can be enhanced with up to 4

riders, to create a customized solution for each policyholder.

Life Time Gold is a unit-linked plan which offers potentially higher returns over the long

term with flexible investment options to help you achieve your goals. It offers 8 fund

options - Preserver, Protector, Return Guarantee Fund, Balancer, Flexi Balanced

Multiplier, R.I.C.H and Flexi Growth.

Life Stage RP is unit linked plan that provides you with an option of lifecycle-based

portfolio strategy that continuously re-distributes your money across various asset classes

based on the customers profile, helping him achieve his desired financial goals.

BABASAB PATIL

36


37/71


LifeLink Super is a single premium unit linked insurance which offers attractive

premium allocation along with the opportunity to enjoy potentially high returns over the

long term, without compromising on the protection of your family.

InvestShield Life New is a unit linked plan that provides premium guarantee and allows

the customer to enjoy the benfits of potentially higher returns while guaranteeing him that

he will get back atleast all the premiums paid by him, while providing protection to your

family with a life insurance cover.

InvestShield Life New is a unit linked plan that provides premium guarantee and allows

the customer to enjoy the benfits of potentially higher returns while guaranteeing him that

he will get back atleast all the premiums paid by him, while providing protection to your

family with a life insurance cover.

InvestShield Cashbak is a unit linked plan that provides premium guarantee while

maintaing a balance between return, safety & liquidity.

Wealth Advantage s a unique whole life single premium unit linked plan that provides

long term coverage upto the age of 70 years and provides you the option to systematically

withdraw your money.

Life Stage Assure a unit linked insurance plan that provides Guaranteed Maturity

Addition of 100%- 450% of first year premium based on the term and number of

premiums paid, with the additional advantage of a lifecycle based portfolio strategy that

allocates the investors money across various asset classes based on his age and risk

appetite

Protection Solutions

Pure Protect is a flexible and affordable term product, with which you can ensure

your life and provide total security for your family in case of an unfortunate event.

Life Guard is a protection plan, which offers life cover at low cost. It is available in 2

options level term assurance with return of premium & single premium.

Home Assure is a mortgage reducing term assurance plan designed specifically to

help customers cover their home loans in a simple and cost-effective mannerChild

Plans:

BABASAB PATIL

37


38/71


Smart Kid New ULRP: The policy is designed to provide money at key educational

milestones in the child's life. SmartKid plans are also

Retirement Solutions:

Forever Life is a traditional retirement product that offers guaranteed returns for

the first 4 years.

Life Time Super Pension is a regular premium unit linked pension plan that

helps one accumulate over the long term and offers 5 annuity options (life annuity,

life annuity with return of purchase price, joint life last survivor annuity with

return of purchase price, life annuity guaranteed for 5,10 and 15 years & for life

thereafter, joint life, last survivor annuity without return of purchase price) at the

time of retirement.

Life Stage Pension is a regular premium unit linked pension plan that provides

you with a unique lifecycle-based strategy that continuously re-distributes your

money across various asset classes based on your age and risk profile.

Life Link Super Pension is a single premium unit linked pension plan.

Immediate Annuity is a single premium annuity product that guarantees income

for life at the time of retirement. It offers the benefit of 5 payout options.

Health Solutions:

Hospital Care is a fixed benefit plan covering various stages of treatment

hospitalization, ICU, procedures & recuperating allowance. It covers a range of

medical conditions (900 surgeries) and has a long term guaranteed coverage upto

20 years.

Crisis Cover is a 360-degree product that will provide long-term coverage against

35 critical illnesses, total and permanent disability, and death.

Diabetes Care Active is a long term insurance policy created for individuals with

Type II diabetes and pre-diabetes. It offers long term (upto 20 years) control over

diabetes through a specially designed Wellness Programme including regular

health checkups and a Diabetes Coach to facilitate diabetes management. It also

provides you coverage against seven major critical illnesses.

BABASAB PATIL

38


39/71


Cancer Care is a regular premium plan that pays cash benefit on the diagnosis as

well as at different stages in the treatment of various cancer conditions.

Medical Assure is a health insurance policy that provides assured insurability till

age 75 years, assured coverage for accepted pre-existing illnesses after 2 years and

an assured price for 3 years.

Health Saver provides comprehensive hospitalization cover and reimburses all

other medical expenses by building a health fund.

available in traditional form

Flexible Rider Options:

ICICI Prudential Life offers flexible riders, which can be added to the Basic policy at

a marginal cost, depending on the specific needs of The customer.

Accident & disability benefit:

If death occurs as the result of an accident during the term of the policy, the

beneficiary receives an additional amount equal to the rider sum assured under the policy. If

an accident results in total and permanent disability, 10% of rider sum assured will be paid

each year, from the end of the 1st year after the disability date for the remainder of the base

policy term or 10 years, whichever is lesser. If the death occurs while travelling in an

authorized mass transport vehicle, the beneficiary will be entitled to twice the sum assured as

additional benefit.

Critical illness benefit:

Critical Illness Benefit Rider provides protection against 9 critical illnesses to the

policyholder when attached to the basic plan.

Waiver of premium:

On total and permanent disablement due to accident all future premiums under the base

plan will be waived till the end of the term of the rider or death of assured life, if earlier.

Income benefit rider:

In case of death of the Life Assured during the term of the policy, 10% of the Sum

BABASAB PATIL

39


40/71


Assured is paid annually to the nominee on each policy anniversary till the maturity of the

rider.

Table Ownership Pattern

Nature of relationship Name of the related party

Holding Company ICICI Bank Limited

Substantial Interest Prudential Corporation Holdings LimitedFellow Subsidiaries ICICI Brokerage Services Limited

ICICI Venture Funds Management Company LimitedICICI Home Finance Company LimitedICICI Lombard General Insurance Company LimitedICICI Trusteeship Services LimitedICICI Securities LimitedICICI Securities Inc.

ICICI Securities Holding Inc.ICICI Investment Management Company LimitedICICI International LimitedICICI Bank UK LimitedICICI Bank CanadaICICI Bank Eurasia L.L.C. (formerly Investment Credit

Bank Limited Liability Company)Prudential ICICI Asset Management Company LimitedPrudential ICICI Trust LimitedICICI Property Trust

Key management

personnel

Shikha Sharma, Managing Director N. S. Kannan, Executive

Director (appointed on August 1, 2005)

Significant influence

ICICI Prudential Life Insurance Company Limited

Employees Group Gratuity Cum Life Insurance Scheme

ICICI Prudential Life Insurance Company Limited

Employees Provident Fund ICICI Prudential Life Insurance

Company Limited Superannuation Scheme

Competitors:

LIFE INSURERS Websites

Public Sector

Life Insurance Corporation of India www.licindia.com

Private Sector

Allianz Bajaj Life Insurance Company Limited www.allianzbajaj.co.in

Birla Sun-Life Insurance Company Limited www.birlasunlife.com

HDFC Standard Life Insurance Co. Limited www.hdfcinsurance.com

ICICI Prudential Life Insurance Co. Limited www.iciciprulife.com

BABASAB PATIL

40


41/71


ING Vysya Life Insurance Company Limited www.ingvysayalife.com

Max New York Life Insurance Co. Limited www.maxnewyorklife.com

MetLife Insurance Company Limited www.metlife.com

Om Kotak Mahindra Life Insurance Co. Ltd. www.omkotakmahnidra.com

SBI Life Insurance Company Limited www.sbilife.co.in

TATA AIG Life Insurance Company Limited www.tata-aig.com

Dabur CGU Life Insurance Co. Pvt. Limited www.avivaindia.com

GENERAL INSURERS

Public Sector

National Insurance Company Limited www.nationalinsuranceindia.com

New India Assurance Company Limited www.niacl.com

Oriental Insurance Company Limited www.orientalinsurance.nic.inUnited India Insurance Company Limited www.uiic.co.in

Private Sector

Bajaj Allianz General Insurance Co. Limited www.bajajallianz.co.in

ICICI Lombard General Insurance Co. Ltd. www.icicilombard.com

Reliance General Insurance Co. Limited www.ril.com

Royal Sundaram Alliance Insurance Co. Ltd. www.royalsun.com

TATA AIG General Insurance Co. Limited www.tata-aig.com

Cholamandalam General Insurance Co. Ltd. www.cholainsurance.com

Export Credit Guarantee Corporation www.ecgcindia.comHDFC Chubb General Insurance Co. Ltd.

REINSURER

General Insurance Corporation of India www.gicindia.com

Market share:

ICICI Prudential Life Insurance hiked its market share to 42.72 per cent in the

October-November period last year, up from 37.92 per cent in first quarter and 38.85 per cent

in the second quarter of the current fiscal.

Its total share of the Rs 439.2-crore premium collected by private players during the April-

November period stood at 39.66 per cent. Its aggregate estimated premium income amounted

BABASAB PATIL

41


42/71


to Rs 174.2 crore as at the end of November. According to ICICI officials, while the premium

mop-up by private companies in April-June 2002 was about Rs 117 crore, the corresponding

figures for the July-September and October-November periods were Rs 201.3 crore and Rs

120.8 crore. Out of this, ICICIs premium income stood at Rs 44.4 crore, Rs 78.2 crore and

Rs 51.6 crore, respectively.

They cited Irda statistics saying the total premium income of the life sector was Rs 1,191

crore in April-June, 2002, and Rs 3,512.8 crore uptil September.

ORGANIZATION STRUCTURE

BABASAB PATIL

BRANCH

OFFICE

SALES OPERATION

SALES MGR SALES MGR SALES MGR

ASM ASMASM

AGENCYMGR AGENCYMGRAGENCYMGR

UNIT MGR UNIT MGR UNIT MGR FINANCIAL

ADVISORS

FINANCIAL

ADVISORS

FINANCIAL

ADVISORS

REGIONAL

HEAD

OPERATOR

ZONAL MGR

STATE

MGR

BRANCH

MGR

TEAM LEADEREXECUTIVE

42


43/71


BOARD OF DIRECTORS

Ms. Chanda .D. Kochhar : Chairperson

Mr. N. S. Kannan : Director

Mr. K. Ramkumar : Director

Mr. Barry Stowe : Director

Mr. Adrian OConnor : Director

Mr. Keki Dadiseth : Director

Prof. Marti G. Subrahmanyam : Director

Ms. Rama Bijapurkar : Director

Mr. Vinod Kumar Dhall : Director

Mr. V. Vaidyanathan : Managing Director & CEO

Management team

BABASAB PATIL

43


44/71


Mr.V.Vaidyanathan, : Managing Director & CEO

Ms. Anita Pai, : Executive Vice Presiden Customer Service,

Technology & Marketing

Dr. Avijit Chatterjee, : Appointed Actuary

Mr. Puneet Nanda, : Executive Vice President

Awards and Achievements

Innovation Award for launching

Diabetes Care Prudence

Award 2006

People Award for excellence in

training and people development

Prudence Award 2006

India's Most Customer

Responsive Insurance Company

- Economic Times Customer

Responsiveness Awards

BABASAB PATIL

44
http://www.iciciprulife.com/public/About-us/ProfileTeam-Vaidyanathan.htmhttp://www.iciciprulife.com/public/About-us/ProfileTeam-AnitaPai.htmhttp://www.iciciprulife.com/public/About-us/ProfileTeam-Dr.%20Avijit%20Chatterjee.htmhttp://www.iciciprulife.com/public/About-us/ProfileTeam-PuneetNanda.htmhttp://www.iciciprulife.com/public/About-us/ProfileTeam-Vaidyanathan.htmhttp://www.iciciprulife.com/public/About-us/ProfileTeam-AnitaPai.htmhttp://www.iciciprulife.com/public/About-us/ProfileTeam-Dr.%20Avijit%20Chatterjee.htmhttp://www.iciciprulife.com/public/About-us/ProfileTeam-PuneetNanda.htm


45/71


Most Trusted Private Life Insurer: The Economic Times - A C Nielsen

Survey of Most Trusted Brands 2004

Prudence Customer Centricity

Award - 2004 & 2005:

Prudential Corporation Asia

Best Life Insurer

2003: Outlook

Money Awards

2003-04

IMM Award for Excellence: Institute of Marketing & Management

Organization with Innovative HR Practices: Indira Group of Institutes

Superbrand 2003-04

Organization with Innovative HR Practices: Asia-Pacific H R Congress

Awards for HR Excellence

BABASAB PATIL

45


46/71


Silver Effie for

Effectiveness of

the Retire fromWork not life

advertising

campaign: Effies

2003

Most Trusted Private Life Insurer: The Economic Times - A C Nielsen

Survey of Most Trusted Brands 2003

Best New Insurer: Outlook Money Awards 2003

Data source:

Primary Data: Personal interactions, ObservationsTraining programs. Through Questionnaire

Secondary Data: Study material by IRDA and ICICI Prudential.

Related websites,

Past records of ICICI Prudential.&

Brochures and pamphlets of ICICI Prudential

Sampling:a) Population : People Hubli city

b) Size : 100 size

c) Method : Random sampling

BABASAB PATIL

46


47/71


MEASURING TOOLS:

SPSS Software used for measuring the response is in terms of percentage method using

graphical charts like Bar graphs & Pie charts.

ANALYSIS:

1. Gendor:

Frequency Percent ValidPercent

Cumulative Percent

Valid Male 73 73.0 73.0 73.0 Female 27 27.0 27.0 100.0 Total 100 100.0 100.0

BABASAB PATIL

47


48/71


gendor

gendor

femalemale

Frequency

80

60

40

20

0

Interpretation:

According to survey we have come to now the out of 100 responds in that

73% are male and 27% female. Therefore male are more than female in Hubli city.

2. Occupation

Frequency Percent ValidPercent

Cumulative Percent

Validgovernmentemployee

9 9.0 9.0 9.0

privateemployee

36 36.0 36.0 45.0

student 1 1.0 1.0 46.0

businessman

29 29.0 29.0 75.0

BABASAB PATIL

48


49/71


Others 25 25.0 25.0 100.0

Total 100 100.0 100.0

occupation

occupation

others

bussiness man

student

private employee

goverement employee

Frequency

40

30

20

10

0

Interpretation:

According survey i came know that at 9% are government,36% are private people,

1% Are student, 29% are businessman, 25% are other.

3. Why did you go for ICICI prudential life insurance?

FrequencyPercent

ValidPercen

t

Cumulative

PercentValidbrand name 39 39.0 39.0 39.0

productprofile

18 18.0 18.0 57.0

advisorsconnivanceability

36 36.0 36.0 93.0

advertisement 7 7.0 7.0 100.0

BABASAB PATIL

49


50/71


Total 100 100.0 100.0

why did you go for icici pru life insurance

why did you go for icici pru life insurance

advertsement

advisors convinacy a

product profile

brand name

Frequenc

y

50

40

30

20

10

0

Interpretation:

From above table clear that brand name 39%, product profile 18%, advisorsconvince ability 36%, advertisement 7% .

4. Your savings consist of

Frequency Percent Valid Percent Cumulative

PercentValid post office 17 17.0 17.0 17.0

bank f,d 10 10.0 10.0 27.0

Shares 6 6.0 6.0 33.0land/ building 6 6.0 6.0 39.0

Life

insurance

55 55.0 55.0 94.0

Gold 3 3.0 3.0 97.0

not respond 3 3.0 3.0 100.0

Total 100 100.0 100.0

BABASAB PATIL

50


51/71


your savings consist of

not respond

gold

life insurance

land/ building

shares

bank f,d

post office

Interpretation:

According to survey we have come to know that 17% of responds are saving

There income in post office, 10% responds are saving in bank f.d, 6% responds are

Saving there income in shares, 6% responds are saving there income in land/building, out of

100 responds are 55% peoples are saving there income in life insurance because to protect

there life in future.3% people are save there income in gold and 3% are not responds there

income

5. The following insurance plan you have

Frequency Percent Valid

Percent

Cumulative

PercentValid smart kid 16 16.0 16.0 16.0

life time

gold

16 16.0 16.0 32.0

cash back 9 9.0 9.0 41.0

retirementsolution

10 10.0 10.0 51.0

if other

specify

31 31.0 31.0 82.0

not respond 18 18.0 18.0 100.0Total 100 100.0 100.0

BABASAB PATIL

51


52/71


the following insurance plan you have

the following insurance plan you have

not respond

if other specify

retirement solution

cash back

life time gold

smart kid

Fr

equency

40

30

20

10

0

Interpretation:

According to survey we have come to know out of 100 responds they have choice

insurance plan in ICICI prudential 16% of people in smart kid, 16% of responds life time

gold, cash back is only 9%, 10% responds retirement solution31% and 18% are others and

not responds.

6. How much of premium amount o policy you have


Percent

Cumulative

PercentValid 5000-10000 63 63.0 63.0 63.0

10000-

20000

13 13.0 13.0 76.0

20000-

50000

2 2.0 2.0 78.0

50000&abo

ve

1 1.0 1.0 79.0


BABASAB PATIL

52


53/71


Interpretation:

According to survey we have come to know that 63% of responds

There premium amount 5000-10000, and 13% responds are prefer to10000-20000

Only 2% responds are premium 20000-50000, 1% and 21% 50000 above and not responds

7. Did you know about the life insurance?


Percent

Cumulative

PercentValid magazines/n

ews papers

1 1.0 1.0 1.0

television 5 5.0 5.0 6.0

advisors 55 55.0 55.0 61.0Friends 20 20.0 20.0 81.0

relatives 6 6.0 6.0 87.0


BABASAB PATIL

53


54/71


did you know about the life insurance?

not respond

relatives

friends

advisors

television

magaznes/new s papers

Interpretation:

According to survey we have come to know out of 100 responds are know

about the life insurance from different sources 1% responds magazines/news papers 5%

respondent are 5% respondent are television more of respondent are come to know from

advisors,20% respondent are friends,6% are relatives and 13%are not respond.

8. Are aware of ulip and traditional plan?


Percent

Cumulative

Percent

Valid Yes 61 61.0 61.0 61.0

No 32 32.0 32.0 93.0

not respond 7 7.0 7.0 100.0

Total 100 100.0 100.0

BABASAB PATIL

54


55/71


are aware of ulip and traditional plan?

are aware of ulip and traditional plan?

not respondnoyes

Frequency

70

60

50

40

30

20

10

0

Interpretation:

According to survey we have come to know that most of people are ulip

Which is 61%and 32% are traditional plan and reaming are not respondent.

9. In which companies have you invested


Percent

Cumulative

PercentValid LIC 19 19.0 19.0 19.0

ICICI pru life

insurance

44 44.0 44.0 63.0

Bajaj Allianz 14 14.0 14.0 77.0

not respond 23 23.0 23.0 100.0

BABASAB PATIL

55


56/71


Total 100 100.0 100.0

in which company have you invested

in which company have you invested

not respondbajaj allianzicici pru life insurlic

Frequency

50

40

30

20

10

0

Interpretation:

According to survey we have come to know that 19% respondent are invested in LIC

life insurance 44% are peoples are ICICI prudential insurance,14% are Invested are in Bajaj

Allianz life insurance and remaining 23% are not respondent.

10. For what purpose you invested in that company?


Percent

Cumulative

PercentValid tax saving 14 14.0 14.0 14.0

risk cover 42 42.0 42.0 56.0Returns 21 21.0 21.0 77.0Safety 6 6.0 6.0 83.0Others 1 1.0 1.0 84.0not respond 16 16.0 16.0 100.0Total 100 100.0 100.0

BABASAB PATIL

56


57/71


for what purpose you invested in that company

for what purpose you invested in that company?

not respondotherssaftyreturnsrisk covertax saving

Frequency

50

40

30

20

10

0

Interpretation:

According to survey we have come to know out of 100 respondent 14%

Are they have invested in life insurance tax saving,42% are to risk saving purpose

21% respondent for purpose of risk cover, and 6% are safety purpose,1% And 16%

Are others and not respondent.

11. Which of the following invested plan would you prefer?


Percent

Cumulative

Percent

Valid traditional

plan

20 20.0 20.0 20.0

Unit linked

insurance

61 61.0 61.0 81.0


BABASAB PATIL

57


58/71


which of the following invested plan would you

which of the following invested plan would you prefer

not respondunit linked insuranctraditional plan

Frequency

70

60

50

40

30

20

10

0

Interpretation:

According to survey we have know that in icici prudential life insurance

comparing between ulip and traditional plan. Out of 100 respondents

20 % traditional plan invested, and 61% are invested in ulip and 19% are not respondent.

12. Have you invested in this plan?


Percent

Cumulative

PercentValid Yes 65 65.0 65.0 65.0

No 23 23.0 23.0 88.0not respond 12 12.0 12.0 100.0Total 100 100.0 100.0

BABASAB PATIL

58


59/71


have you invested in this plan

have you invested in this plan

not respondnoyes

Frequency

70

60

50

40

30

20

10

0

Interpretation:

According to survey 65% respondent are invested in ulip And 23% are not

invested. 12% are respondent not respondent.

13. If, yes why did you give Importance in this plan?


Percent

Cumulative

PercentValid Returns 32 32.0 32.0 32.0

withdrawals 18 18.0 18.0 50.0Charges 15 15.0 15.0 65.0premium 10 10.0 10.0 75.0Others 2 2.0 2.0 77.0not respond 23 23.0 23.0 100.0Total 100 100.0 100.0

BABASAB PATIL

59


60/71


if,yes why did you give imporance in this plan

if,yes why did you give imporance in this plan

not respondotherspremiumchargesw ithdrawalsreturns

Frequenc

y

40

30

20

10

0

Interpretation:

According to survey we come to know that 32% Invested for the return, 18% invested

for purpose withdrawals, 15%Charges facility, 10% respondent premium, 2% and 23% others

and Not respondent.

14. Rank the unit linked insurance plan?


Percent

Cumulative

Percent

Date post:	14-Apr-2018
Category:	Documents
Upload:	sunil-soni
View:	222 times
Download:	0 times

Comparison Between Traditional Plan ULIPs PROJECT REPORT

Documents