icici prudential
TRANSCRIPT
ASUMMER TRAINING REPORT
ON
CHANNEL DEVELOPMENT
IN ICICI PRUDENTIAL LIFE INSURANCE CO.Jaipur.
Submitted In The Partial Fulfillment Of The CourseMaster Of Business Administration (MBA)
Submitted to:- Submitted by:- Mr. Kushal singh Naresh Narayan PareekICICI PRUDENTIAL. M.B.A, II YearJaipur(Raj.)
Gyan vihar Universe International School of Business Management
Jagatpura Jaipur(Raj.)
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INDEX Certificate from ICICI Certificate from College Preface 4 Acknowledgement 5 Executive Summary 6
Table of ContentsChapter No. Topic Page No.Chapter 1 INTRODUCTION 7
1.1 History of Insurance 8-91.2 Liberalization of the Insurance Sector 101.3 Major Players 111.4 What is Insurance? 121.5 Reason for Insurance 131.6 Importance of Insurance 131.7 Advantage of Life Insurance 14-15
Chapter 2 COMPANY PROFILE 162.1 ICICI Prudential Life Insurance Company Ltd.172.2 Sponsors 182.3 Prudential PLC 19-202.4 Bank Assurance 212.5 Technology 212.6 Aim of the Company 22-23
Chapter 3 INTRODUCTION TO PROJECT 24Introduction of Agent 25-26
3.1 Channel development 27-473.2 Principal of Channel development 48-503.3 The working environment 51-52
Chapter 4 IRDA 534.1 Duties, Powers & Functions 54-554.2 Essential for the license 564.3 Qualification 564.4 Disqualification 574.5 The duties and obligation of the agent 584.6 Code of conduct for the agent 59-60
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Chapter 5 PROJECT PROFILE 615.1 Project title 625.2 Research Objective 625.3 Research Methodology 62-635.4 Significance of Study 645.5 Limitations 64
Chapter 6 Facts and Findings 656.1 Research Findings 66-67
Chapter 7 CONCLUSION & SUGGESTIONS 687.1 Conclusion 69-707.2 Suggestions 71
BIBLIOGRAPHY 72-73
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PREFACE
The Insurance which have become an Instrument of Economic & Social Development has witnessed a tremendous growth during the last six years.
The Insurance sector in India was come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360 degree turn witnessed over a period of almost two centuries.
The business of life insurance in India in its existing from started in India in the year 1818 with the establishment of the arrival life Insurance Company in Calcutta.
The present study has been conducted to identify by the activities of ICICI PRUDENTIAL LIFE INSURANCE COMPANY by ensuring that organization gives efficient services to the customer.
In Insurance sector, the role of Agents becomes necessary and important. Agents are playing very important role in insurance market by providing their services.
The report covers the Role, Functions, Benefits and Duties of Agents in ICICI Prudential Life Insurance Company Ltd. This helps to understand about the role and importance of Agents.
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ACKNOWLEDGEMENT
I owe my sincere & heartiest gratitude to Mr. Khushal Singh (Sales Manager ICICI Prudential Life Insurance Company) who gave me the opportunity to work with ICICI Prudential Life Insurance Company as a summer trainee & helped, whenever I needed him.
I am grateful to the lecturers of Seth Sushil Kumar Bihani an institute of Management & Information Technology, Sri Ganganagar for his support & Encouragement opportunity to preface such a report.
I also thank management of insurance brokerage firms, banks & corporate agents & many people to whom I visited during my training period.
Naresh Narayan Pareek
M.B.A II Year
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EXECUTIVE SUMMERY
The entire Project was a learning experience and has given me idea about the
Insurance product and Insurance market. The experience was also very rewarding and
exposed me to the real world of Insurance.
It was assigned a project to ICICI Prudential on the topic of “Live project on
channel development in an Insurance company and its impact on key parameters .”
The focus of the study is the charted Accountants, House wives, Students, VRS
persons in Sri Ganganagar. Every effort is made by the developer to elicit all information
regarding the customer’s needs, expectation, and their problem about the Insurance.
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CHAPTER – I
INTRODUCTION
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INTRODUCTION
1.1 History of Insurance
Historians believe that insurance first developed in Sumer & Babylonia.. The merchants & traders of these societies transferred & pooled their money to protect themselves from pirates.
In the 18th century BC, Babylonian king Hammurabi developed a code of law known as the code of specific rules governing the practices of early risk-sharing activities.
Insurance developed during the 1700’s in the North American colonies. In 1730, Benjamin Frank contributed for the Insurance of Houses from Loss by fire. The company collected contributions & this money went into an investment fund. Interest on this fund went towards paying claims dividends to those who contributed money.
The Industrial Revolution in the US, in the early & mid 1800’s prompted dramatic group. During this time, many companies were establishes to sell life insurance policies & annuities. Several shared profits among policy holders, also developed. In addition, some life insurance companies charged premiums according to age of people health.
Life insurance, in its present form, came to India from the United Kingdom with the establishment of a British firm, Oriental Life Insurance Company in Calcutta in 1818, followed by Bombay Life Insurance Assurance Company in 1823, the Madras Equitable Life Insurance Society in 1829, & the Oriental Government Security Life Assurance Company in 1874. Prior to 1871, Indian lives were treated as sub-standard & charged extra premium of 15% to 20%. Bombay Mutual Life Assurance Society, an Indian insurer which came into existence in 1871, was the first to cover Indian lives at normal rates.
The Indian Life Assurance Companies Act, 1912 was the first statutory measure to regulate life insurance business. Later in 1928, the Indian Insurance Companies Act was enacted, to enable the govt. to collect statistical information about both life & non-life insurance business transacted in India by Indian & foreign insures, including the provident insurance society. Comprehensive arrangements were, however, brought into effect with the enactment of the Insurance Act, 1938. Efforts in this direction continued progressively & the Act was amended in 1950, making far reaching changes, such as requirement of equity capital for companies carrying on life insurance business, stricter controls on investment of life insurance companies, ceiling on the expenses of management & agency commission etc.
By 1956, 154 insurers, 16 non-Indian insurers & 75 provident societies were carrying on life insurance business in India. On 19 th January 1956, the management of the entire life insurance business of 229 Indian insurers & provident insurance societies the
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Indian life insurance business of 16 non-Indian life insurance companies then operating in India, was taken over by the central govt. & then nationalized on 1 st September 1956 when life Insurance Corporation came into existence. An ordinance was passed in 1968 to amend the Insurance Act to regulate/control non-life insurance resulting in set up of GIC in 1973. Malhotra committee submitted its report in 1994 & recommended means to reintroduce an element of competition by withdrawing the exclusivity of LIC & GIC. In 1997, Insurance Regulatory Authority (IRA) was established which was later re-styled as IRDA in 1999.
1.2 Liberalization of the Insurance Sector
Liberalization commitments of the country to help in disciplining future economic policies will include the insurance reforms. When the world over, insurance, markets have been opened up, India cannot remain in isolation. Globalization is the new economic reality, which is here to stay, heralding a new era of insurance in India. With the opening of the insurance industry, India stands to gain the following major advantages:
1. Globalization will provide improved opportunities to the customers for better products, with more reasonable & affordable pricing.
2. The customer will get quicker servicing.
3. It will enhance the savings rate.
Long term funds for infrastructure development will be available to the country.
4. It will secure for India larger inflows of foreign capital needed to sustain our GDP growth.
1.3 Major Players
LIFE INSURANCE BUSINESS NON-LIFE INSURANCE BUSINEES
Life Insurance Corporation
ICICI Prudential Life Insurance
HDFC Standard Life Insurance
Max New York Life Insurance
Birla Sun Life Insurance
General Insurance Corporation
National Insurance Company
The New India Assurance Company
The Oriental Insurance Company
United India Insurance Company
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OM Kotak Mahindra Life Insurance
Reliance Life Insurance
Allianz Bajaj Life Insurance
Dabur CGU Life Insurance
ING Vyasa Life Insurance
SBI Life Insurance
Reliance General Insurance
TATA-AIG Insurance
Royal Sundaram Alliance General Ins.
Bajaj Allianz General Insurance
ICICI Lombard Insurance
1.4 What is Insurance?
Insurance is a legal contract that protects people from the financial costs those results from loss of life, loss of health, lawsuits, or property damages. Insurance provides a means for individuals & society to cope up with some of the risks faced in every day life by every body. People purchase contracts of insurance, called a Policy, from various insurance companies. Almost every person existing in this world is associated with insurance directly or indirectly, Directly, in the sense that he/she has insured his/her life by some kind of insurance policy from any company, Indirectly, in the sense they must have insured the assets of their own for example their house, car or any thing else.
Insurance can be divided into three categories:
1. Life Insurance
2. General Insurance
3. Health Insurance
Life Insurance is a contract for payment of a sum of money to the person assured (for failing him/her, to the person entitled to receive the same) on the happening of the event insured against. Usually the contract provides for the payment of an amount on the date of maturity or at specified intervals or at unfortunate death. The contract also provides for payment of premium periodically to the corporation by the assured. General Insurance includes many areas of insurance like marine, motor, engineering, health, fire, etc. The contract provides for the payment of an amount on the happening of some contingency. These types of contracts are annual in nature.
1.5 Reason for Insurance
In life, losses are sometimes unavoidable. People may fall seriously sick or lose income or savings to pay off medical bills. Individuals or their relatives may come across
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untimely death, whatsoever the reason may be. The assets of people may get damaged due to some heavenly act or by some nuisance creator.
No one knows in advance when a loss will occur or how serious that loss will be. The uncertainty surrounding potential losses is known as Risk. Insurance offers a way for people to replace risk with known costs-the costs of buying & maintaining insurance policies.
Insurance pools risks shared by many people, thereby, reducing the risks faced by a group. People pay to by insurance coverage (protection from risk). In exchange, all policy holders (People who own insurance policies) receive a promise that the group of policy holders as represented by the insurance organization will pay when any policy holder experience kind of loss.
1.6 Importance of Insurance
Insurance benefits society by allowing individuals to share the risks faced by many people. But it also serves many other important economic & societal functions. Insurance provides the capital that communities need to quickly rebuild & recover economically from natural disasters. Insurance itself has become a significant economic force in most of the industrialized countries. Businessmen by insurance to cover their employees against work related injuries & health problems. They also insure their assets against any kind of wear n tear by natural forces & forcibly.Insurance companies perform a type of monetary redistribution0-they collect premiums & eventually redistribute that money as payments. Depending on the type of insurance, redistribution can take place anywhere from a month to many decades. Because of this delay between collecting & paying out funds, insurance companies invest their funds to bring extra revenue. Such investments help business & government finances their operations, & few profits from these investments support the operations of insurance companies. With these investment earnings, insurance companies can keep rates much lower than would otherwise be possible.
1.7 Advantages of Life Insurance
It is superior to an ordinary saving plan: Unlike other saving plans, it affords full protection against risk of death. In case of death, the full sum assured is made available under a life assurance policy; whereas under saving scheme the total accumulated saving alone will be available. The later will be considerably less than the sum assured, if death occurs during early years.
Easy settlement & protection against creditors : The life assured can name person(s) called Nominee to whom the policy money would be payable in the Event of his death. The proceeds of a life policy can be protected against the claim of the creditors of the life assured by effecting a valid assignment of the policy.
Ready marketability & suitability for quick borrowing : After an initial period, if the policy holder finds him unable to continue payment of premiums, he can surrender the policy for a cash sum. Alternatively, ha can tide over a temporary difficulty by taking
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loan on the sole security of the policy without delay. Further, a life insurance policy is sometimes acceptable as security for a commercial loan.
Tax Relief : The Indian Income-Tax Act allows deduction of certain portion of the taxable income which is diverted to payment of life insurance premiums from the total income tax liability. When this tax relief is taken into account, it will be found that the assured is in effect paying a lower premium for his insurance.
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CHAPTER – 2
COMPANY PROFILE
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COMPANY PROFILE
2.1 ICICI Prudential Life Insurance Company Limited
ICICI Prudential Life Insurance Company Limited was incorporated on July 20, 2000. The authorized capital of the company is Rs. 2300 Million and the paid up capital is Rs. 1500 Million. The company is a joint venture of ICICI (74%) and prudential plc UK (26%).
The Company was granted Certificate of Registration for carrying out Life Insurance business, by the Insurance Regulatory and Development Authority on November 24, 2000. It commenced commercial operations on December 19, 2000, becoming one of the first few private sector players to enter the liberalized arena.
The Company is now operational in Agra, Ahmedabad, Ajmer, Allahabad, Amritsar, Aurangabad, Bangalore, Bhatinda, Bhopal, Bhubaneswar, Chandigarh, Chennai, Coimbatore, Dehradun, Goa, Guntur, Gurgaon, hyderabad, Hubli, Indore, Jaipur, Jalandhar, Jamnagar, Jamshedpur, Jodhpur, Kanpur, Karnal, Kochi, Kolakata, Kota, Kottayam, Lucknow, Ludhiana, Madurai, Mangalore, Meerut, Mumbai, Nagpur, Nasik, Noida, New Delhi, Patiala, Rajkot, Ranchi, Surat, Thane, Thrissur, Trichy, Trivandrum, Vadodara, Vashi, Vijaywada & Vizag.
Till March 31, 2002 the Company has issued 100,000 policies translating into a Premium Income of around Rs. 1,200 Million and a sum assured of over Rs. 15,000 Million. The Company recognizes that the driving force for gaining sustainable. Competitive advantage in this business is superior customer experience and investment behind the brand. The Company aims to achieve this by striving to provide world-class service levels through constant innovation in products, distribution channels and technology based delivery. The Company has already taken significant steps to achieve this goal.
2.2 Sponsors
ICICI Ltd. was established in 1955 by the World Bank, the Government of India and the Indian Industry, to promote industrial development of India by providing project and corporate finance to Indian industry.
Since inception, ICICI has grown from a development bank to a financial conglomerate and has become one of the largest public financial institutions in India.
ICICI has now developed a whole range of activities to become a Universal Bank. Some of ICICI spectrum of activities includes:
Commercial Banking – ICICI Bank, India’s first internet bank.
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Information Technology – ICICI InfoTech, transaction procession, software development.
Investment Banking – ICICI Securities, one of the key players in the Indian Capital Markets.
Mutual Fund – Prudential ICICI AMC, leading private sector mutual fund player in India.
Venture Capital – ICICI Venture, leading private equity investor with focus on IT and HealthCare.
Retail Service – ICICI PFS, Marketing and Distribution of Retail Asset Products.
Distribution – ICICI Capital, Distribution and Servicing of Retail Liability Products.
ICICI is listed on the Indian Stock Exchanges and on the New York Stock Exchange (NYSE). On September 22, 1999, it became the first Indian company to be listed on he NYSE (symbol: IC and IC.D). The listing of ICICI BANK has followed this on NYSE (symbol: IBN) on March 28, 2000.
2.3 Prudential Plc :
Prudential Plc was founded in 1848. Since then it has grown to become one of the largest providers of a wide range of savings products for the individual including life insurance, pensions, annuities, unit trusts and personal banking. It has a presence in over 15 countries, and caters to the financial needs of over 10 million customers. It manages assets of over US$ 259 billion (Rs. 11, 39,600 crore approx.) as Of December 31, 1999. Prudential plc has had its presence in Asia for the past 75 years catering to over 1 million customers across 11 Asian countries.
Prudential is the largest life insurance company in the United Kingdom. Asia has always been an importance region for Prudential and it has had a presence in Asia for over 75 years. In fact Prudential’s first overseas operation was in India, way back in 1923 to establish Life and General Branch agencies.
In the Us, Prudential owns Jackson National Life, one of the leading life insurance companies. Prudential controls approximately 4% of all the listed shares on the second largest stock exchange in the world, the London Stock Exchange, making it one of the largest institutional investors in the UK. Prudential is focused on the Internet generation and is one of the first financial service organizations to use the Internet on a fully integrated basis.
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In October 1998, Prudential launched a “branches” bank based on the internet. Unusually titled as “egg;|”. The bank has in a short span of its existence become a leading banking service provider in the UK. Infect in the first six month of its existence in garnered over 5 billion (US$ 8 billion) in deposits from over 500,000 customers.
Development of superior products and services that offer value for money and security while producing superior financial returns enables Prudential to maximize the value of its shareholder’s investment and to establish lasting relationships with customers and policy holders.
ICICI and Prudential came together in 1993 to provide mutual fund products in India and today are the largest private sector mutual fund company in India. The two companies bring together two of the strongest financial service brands in Asia known for their professionalism, excellent quality of service and long term commitment.
2.4 Bank Assurance The company has twelve bank assurance tie-ups, having agreements with ICICI Bank, Allahabad Bank, Federal Bank, South Indian Bank, Bank of India, Lord Krishna Bank & Punjab & Maharashtra Co-Operative Bank, Goa State Co-Operative Bank, Indoor Paraspar Sahakari Bank, Manipal State Co-Operative Bank, Shamrao Vithal Co-Operative Bank & Jalgaon People’s Co-Operative Bank as well as some corporate agents. It has also tied up with organization like Dhan for distribution of Salaam Zindagi, a policy for the socially & economically underprivileged sections of society.
2.5 Technology
The Company continuously leverages on the state of art technology that it posses. The modern & updated technology infrastructure helps not only to provide superior quality of products & services to the customers but at the same time helps in creating a prudent reward & recognition program for the company itself. The company can leverage on this advantage to drive out one of the best CRM industry at the present. The parent company also is in a move to duplicate the ICICI model in other world market. It is nothing but a result of the superb all-round performance
That the company has shown in all the facets of business & over the period of time. But one importance has been the continued focus on growth & the strife for result from the workforce itself.
2.6 Aim of the Company
Their vision is to make ICICI Prudential Life Insurance Company the dominant new insurer in the life insurance industry. This they hope to achieve through their commitment to excellence, focus on service, speed and innovation, and leveraging our technological expertise.
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The success of the organization will be founded on its strong focus on values and clarity of purpose. These include:
Understanding the needs of customers and offering them superior products and service.
Leveraging technology to serve customers quickly, efficiently & conveniently.
Developing & implementing superior risk management & investment strategies to offer sustainable & stable returns to the policy holders.
Building long lasting relationship with their partners.
Providing an enabling environment to foster growth and learning for their employees.
They believe that they can play a significant role in redefining and reshaping the sector. Given the quality of their parentage and the commitment of their team, they feel that there will be not limits to their growth. The success of the company lies in its unflinching commitment to five core values – Integrity, Customers first, Boundary less, Ownership & Passion.
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CHAPTER –3
INTRODUCTION TO PROJECT
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INTRODUCTION TO PROJECT
3.1 Introduction of Agent
Agent: The Definition
According to the section 182 of the Indian Contract Act, 1872, “an agent is a person employed to do any act for another or to represent another in dealing with a third person.”
In the insurance sector the term “agent” is ordinarily applied to a person engaged by the insurer to procure new business.
Powers of the Agent
An agent can act only to the extent of authority may be expressed or implied. An authority is said to be expressed when it is given by words spoken or written. It is implied when it is to be inferred from the circumstances of the case.
Life Insurance Agent
The insurance Act, 1938 defines an agent as “one who is licensed under the act and is paid consideration of his soliciting or procuring insurance business including business relating to continuance, renewal or revival of the policies of insurance .”
The Importance of Advisors
ICICI Prudential Life Insurance Co. Ltd. aspires to provide state of the art of customer service & opportunities & avenues for enterprising people to grow & prosper. The company wish to grow exponentially that is backed by the latest technology, hence offering its customers:
Complete & diversified product portfolio.
Faster & more accurate service.
Multi-channel distribution systems.
Highly trained professional sales people offering quality pre & post sales service.
It is in the above mentioned areas of personal specialization where the importance of an advisor clearly stands out the advisor not only contribute in brining in new business for the company, but also plays an important part in offering world class pre & post sales.
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Service to the clients to the clients with the support of the organization. But the company in its principles clearly states out that an advisor to means “much more than a salesman or a saleswoman, we at ICICI prudential recognize our advisors as the ambassadors of our organization in the market place & we consider force would be our biggest differentiating factor in the coming years” . The advisor is an important asset not only for the organization from the business point of view but also to the society
On the whole as he/she is someone who provide valuable service to the community be helping people attain financial security & build funds for their future needs thereby assisting them in getting their financial freedom.
If looked from the other side of the business where the company is operating the competitive Indian market & more so in the business of life insurance where the customers looks for self-belief & faith then the advisor certainly holds the vital link in the overall business proposition. They represent the company’s face & words on which the customers can trust because the customer knows that face. The advisor helps to create a web for the business to grow & driving the customer to come to the company with complete trust & faith.
3.2 Channel Development
A Company has chosen channel alternative individual intermediaries must be selected, trained, motivated and evaluated channel arrangements must be modified overtime.
The Profile of an Advisor
Qualifications
1. Age should be ideally between 25-60 years.
2. Minimum education qualification is 10+2.
3. Good & convincing communication skills.
4. Capacity to build an impressive network.
5. Engaged in gainful business or corporation
6. Willing to undergo extensive training & development programs.
7. Pleasing personality.
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Skills & Competencies
As quoted by Mr. Shubro Mitra, Head HR, ICICI Prudential Life Insurance the Company is always on a look out for people who have the following skills & competencies that we require in business are:
Actuarial skills.
Investment management skills.
Core operation skills.
Core underwriting skills.
Relationship management skills.
Project management skills.
Leadership & Team skills
A passion for achieving results.
High energy levels & infectious enthusiasm.
Open to ideas.
Strong team players.
High caliber & ability.
And above all, unyielding integrity.
JOB PROFILE
As an advisor for the company, the role of the individual is no way limited to sell the policies of the company. But the role basically starts from the basics of explaining the life insurance aspects & the potential benefits to the customers. Further he is required to assist them in deciding upon the plan that suits them the best in terms of finance and security provided. Therefore the opportunity to the advisor is unlimited in no way and he typical benefits can be mentioned as followings:
There is absolutely no need of a startup capital.
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There is the benefit of flexible working hours.
The freedom to work from anywhere & being one’s own boss.
The unlimited earning benefits in form of remuneration & incentives.
And the privilege of being a part of a world class sales team.
The role of an advisor is multifaceted in the sense that his work scope is in no way limited. But in a nut shell the expectations from an advisor has been laid down by the management in the following manner under two main headings:
1. Providing continuous financial advice to clients.
Identifying prospective clients.
Making appointments.
Conducting reviews with prospective/existing clients.
Closing the sales contracts.
Getting more referrals so as to increase the network.
Providing pre & post-sales services to clients.
2. The advisor is also required to regularly follow the internal sales & the internal reporting system so as to get the feed back & further leads for the prospective areas of business & improvement.
Benefits & Support provided by Company
The benefits have already been mentioned very often in the previous section but it’s necessary to look into them as a comprehensive criterion. The main benefits & supports that an advisor would be availing of are the distinct ICICI Prudential Life advantages:
Rewarding career
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The job profile as mentioned earlier is unlimited & an advisor will help people realize their dreams & provide them the financial & psychological security & faith. The ultimate rewards will be the difference made to all these lives & that would be most satisfying in the real sense.
Successful Team
Being at ICICI gives the opportunity to be a part of India’s best team of life insurance advisors. The company is numero uno among the private players in the industry & has won numerous recognition & awards that give it the international edge.
Attractive remuneration
ICICI offers the most competitive remuneration benefits at present in the industry, which proves to be very useful from long term perspective of financial security. There is absolutely no limit to one’s earning & the added incentives just help as advisor to get more than what he/she expects.
Independence
At ICICI, the advisor is a boss in himself & in the real sense. There is the freedom to choose the workplace, the work timings & the amount of earnings one wants to have moreover there is no need of any initial capital investment, yet one can become an entrepreneur in the most unexpected manner.
World Class Training
The company leverages on the international linkage that it has got to provide the best training available in the industry at the present. The company aims to impart the necessary skills & competencies to all even if there is not previous experience with the individual. The presence of trained in-house trainers & professionals provide the necessary aspects of training required. Moreover, the training is being provided with the help of professional institutions & centers like the RNIS College.
Career Agency System
ICICI’s commitment to Career Agency System imparts support to the advisors at every stage of the business. The company believes in encouraging the advisors to the highest level of success all through their career. One of the distinct factors is the opportunity & the option of a management career option for the successful performers.
Best Infrastructure`-23-
The huge investments that the company has made to develop the state of art infrastructure throughout the business. The infrastructure provides the necessary tools, technology & human support that enable to build a profitable long-term relationship.
Extensive Product Portfolio
The company has got more than four hundred policies for its customers. This consists of the unique individuals, groups & rider policies. This extensive, diversified & comprehensive range provides the competitive edge that no other advisor would be having in the market.
Sales & Marketing Support
The company has got unique sales & marketing tools to help & support the advisors at every stage of the career. The sales, promotions & marketing collateral’s hat the company posses help to achieve just that.
Financial Strength
ICICI Prudential offers the advisors & the customer’s unmatched financial strength solidity. The huge amount of paid up capital & growing revenues are an indicator of the same.
Support provided by the Unit Manager
Field visits for the incumbents.
Training on products & selling skills.
Regular business reviews to monitor the progress.
The UM acts both as a coach & a mentor.
The UM recognizes the high performers.
Helps in becoming financially independent.`-24-
BUT- The expectations from the team
To achieve the sales targets given.
To participate in all the meetings being placed.
Attending all the training programs being arranged.
Report for the weekly reviews at the office.
Regularly following the sales process.
And his advisors are also required to follow the weekly reporting process.
Career Progression
The Tiger Team
It is an exclusive program achievers among the advisors but the scope of progression is limited only to a few hand picked all round performers. The TIGER TEAM represents a fast track career path for the advisor. The successful candidates are recognized as Tigers. One continues to do his/her business but the benefits come added on. The criteria for selection are:
Age 25-40 years.
At least one year of working in the system.
Case count should be at least of two per month.
The Mobile Tigers
This program offers the following benefits:
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Part time career as a trainee.
To conduct foundation programs
Opportunity to share the best field practices.
Chance to replicate one’s own business.
Freedom to continue with one’s business.
The selection criteria for this program are:
Age 25-40 Years.
At least six months of working in the system.
Case count of at least two per month.
The Pinnacle Program
This program is for the high achievers in the system & the major benefits that are one offer are as following:
A full time career as a Unit Manager.
The possibility of growth within ICICI Prudential.
Greater earning potential
The scope from personal development.
The selection criteria for this program are:
Age 25-40 years.
At least six months of working in the system.
Case count of at least two per month.
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Fast Track Pinnacle Program
This program offer following features:
Offering a full time career as a Unit Manager.
Opportunity of growth within ICICI Prudential.
Scope of greater earning potential.
The scope for personal development.
The selection criteria for this program are:
Age 25-40 years.
At least six months of working in the system.
Case count of at least two per month.
Agency Champion
This is the highest level of career progression on offer. It has got several distinct features, which sets it apart from all the above mentioned programs. This program aims at rewarding the super-achievers working with the company. The features of this program are as follows:
The chance of taking one’s business to higher level.
To develop one’s own business, i.e. to develop into an entrepreneur.
The freedom of recruiting new advisors & making one’s own team.
The potential of increased reach of network.
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The selection criteria for this program are as following:
At least one year of working I the system.
Minimum of 36 policies & Rs. 3.6 lacs premium.
Selection process (assessment center)
THE TYPICAL CAREER PROGRESSION PATH
UM ASM
Trainer 12-18 Trainer 12-18 Months Months Advisor Agency Manager
Trainer Role BSM
SALES MANAGER
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Commission Structure
The production targets shall be split into two stages:
1. Minimum Business Guarantee (MBG)
2. Bonus Target
Minimum Business Guarantee (MBG)
The Minimum business that has to be achieved.
Every quarter required to sell at least three policies & collect Rs. 20,000 as FYP Weightage for premium on single premium is 10%.
Only the premium received in a quarter will be considered.
FYP implies premium for all new business in that quarter.
Annual target of Rs. 80,000 FYP & 12 policies to be met.
Bonus Target
The advisors are aptly rewarded for higher levels of productivity that they achieve. The bonus targets for such achievers are as following:
Production Level Per Quarter Bonus Per Quarter`-29-
0-22, 500 Nil
22,501-35,000 10% of base commission
35,001 & Above 40% of bas commission
Payments & Commission
Year1 Year2 Year3
Number of Policies sold 50 75 100
Average premium (Rs.) 16,000 16,000 16,000
Total premium earned (Rs.) 8,00,000 12,00,000 16,00,000
Average commission (including 1,80,000 2,70,000 3,60,000
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bonuses estimate @ 22.5%*)
Earning from new business (Rs.) 1,80,000 2,70,000 3,60,000
Commission on renewal @ 6% 48,000 72,000
For year 2,3 & 3% after that 48,000
Earning from renewal business (Rs.) 48,000 1,20,000
Total earnings (Rs.) 1,80,000 3,18,000 4,80,000
* Depending upon the product mix commission can go upto 35% in the first
Year, 7.5% in the 2nd year & 3rd year & 5% for the 4th year onwards.
The Recognition Program
The president’s club -rewarding the best of the best advisors.
The achievers club
a. ICICI Pru India Star Club
b. ICICI Pru Presidents Club
c. ICICI Pru Debut Star Club
d. ICICI Pru Star Clubs
MDRT Membership
Foreign Trips and Seminars
ICICI Pru Star Club Benefits
Benefits Platinum Club Gold Club Silver Club
Business Cards 1,000 pcs 800 pcs 500 pcs
Personalized Stationery 1,000 pcs 800 pcs 500 pcs
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Personal Accident Policy Rs. 1.50 lacs Rs. 1.00 lacs Rs. 75,000
Certificate of excellence Once a year Once a year Once a year
Memento Worth Rs. 500 Worth Rs. 300
Worth Rs. 150
Sales promotion items Worth Rs. 4000 Worth Rs. 3,000
Worth Rs. 2,000
Business allowances Rs. 10,000 p.a. Rs. 7,500 p.a.
Rs. 4,000 p.a.
Office/Technology support
Rs. 15,000 p.a. Rs. 12,500 p.a.
Rs. 10,000 p.a.
Lunch with CEO/EVP Once every 6 months
Once every 6 month
Once a year
The Procedures of Becoming Advisor
ICICI believes in getting who can align with the company’s principle & beliefs well enough to grow on their own. In the words of the top management of company believes that one can become an advisor for the leader only & only if he/she has he following:
Confidence
Self-motivation
Persuasion
Urge to be financially independent
Relationship skills
The broad steps that best describe the procedure of becoming an advisor in the company are as following:
Confirmation of mutual interest as between the company & the individual
Appearing & clearing the selection interview
Profiling of the test dates between parties
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Draft payment favoring ICICI Prudential Life Insurance Co. Ltd. , payable Mumbai.
Finalizing of the training dates & the venue.
The Company provides for the all-round development of the individual & any previous experience or inexperience in the related field is not an obstacle. The professional approach of the company in the training module helps it to train the incumbents in the best possible manner. The company has got a professional in-house training staff that is one of the best in the practice. The company has laid down for a State-of-art training on:
Selling skills
Product knowledge
Relationship skills
The training is delivering through several convenient options keeping in view the requirements of the individuals & the target of the company. The training is done at the timing & venue decided upon by the parties concerned.
The incumbents have to complete hundred hours of training in any model that they choose from. The guidelines laid down for the training are as per the books IRDA. The training concept can be classified according to very different aspects, which can be the delivery medium & the time involved.
On the basis of the delivery medium the process can be of:
Face to face training
Online training
Self learning
On the basis of the time involved the process can be of:
Full time-involving 15 days
Part time-involving 27 days
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Online training-involving 2 months
So if we summarize the steps & formalities involved in the whole process, the formalities for a candidate to become the advisor as per the IRDA are:
Filling up the insurance advisor form Documents required
7 passport size photographs
Acceptable age proof
Acceptable education proof
Acceptable residence proof
Payment through the demand draft
Completion of the training
Reporting of the form with the DOPS
The PROGRAM FLOW for the whole process describes how the training of the advisor starts and how it works:
Week 1
IRDA prescribe syllabus
Insurance basics
Week 2
Advisor support system
Customer need analysis
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ICICI Pru’s insurance solutions
Advisor’s career progression
Tele-calling
Week 3
Revision
Mock Test
STAR GREEN AMBER RED
CLUB 6 days/yr. 3 days/yr. 1 day/yr.10 days/yr.
Segment Training – post 3 months (Profiling /RACE)
Saturday Business Development Clinic-1 day in first 3 months
THE FOUNDATION PROGRAMME
3.3 The Principal of Channel Development
The Company in its vision out the urge to become the dominant player in the industry. The company believes that a high level of self-motivation & a coherent teamwork for the organization can only achieve this on the whole. The company stresses great emphasis on its core values, which are:
INTEGRITY
CUSTOMER FIRST
BOUNDARY LESS
OWNERSHIP
PASSION
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These are foundation on which the organization works & the base for the overall business environment of the company. Based on the above mentioned ‘Pillars’ of the company the management has devised the basic principles for the program as a whole which are as following:
Recruit the best
Experts in knowing what exactly their customers wants is well versed in spotting the talents from the pools & recruiting only those who have the intellect, energy, drive & the passion to initiate new beginnings & even a lot of changes if they feel so. The incumbents are treated as winners & the ‘custom hiring’ principle necessitates the factor of having the right person at the right place with the right work. And definitely no compromises on expertise & competencies.
Personal Responsibility
The Company believes hat it is the prerogative of the company to create the team that it wants. Therefore it aims to providing the learning & development conduits to employees to enhance the domain of knowledge the important leadership & team skills.
Empowered Teams
Each employee is a stakeholder in the organization & its growth. It is the one of the important especially here that the responsibility comes with a degree of autonomy & accountability. The area of operation & growth is to be decided by the Individuals himself. But the communication is across the channels & ranks whereby the targets are sent & the corrective measures & rewards also come to them. The most important factor is the employee participation & empowerment.
Rewards & Recognition
The rewards in the company are directly proportional to the work & targets achieved & gone beyond. You work hard you earn more. The contributions done are recognized in the most objective & transparent manner & on the demonstrated competence level. But yes there is certainly an extra for the people who go beyond then what is expected from them.
Shared Vision & Purpose
The company focuses on having the organization striving towards a common goal, which is easily done through the effective communication & work channel. Large-scale interactive process at the organization & group level helps in getting the employees know of what is expected of them & how has been achieved. This factor encompasses through all the critical intervention by the team members or the mentor of the team.
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3.4 The Working Environment
The Company is in a continuous search for the best of talents in the market, which align with the vision & mission of the organization. The company states out its working culture in certain important factors for the interested incumbents:
Urge from the incumbent to be a part of a world class sales steam.
The freedom of working from his/her own office/residence.
The flexibility of working hour’s i.e., full time or part time.
Opportunity to earn commission, bonus & incentives.
Unlimited earnings – directly proportional to your efforts.
Most important- the chance of flexible career.
The company is aware of the current in the market & the essential factors of increasing the personal & human feeling to business. Thus, the company has got some underlying facts & reasons for the working in a specific manner.
The company gives the space & time required to grow, achieve & to seek new domains & opportunities. The changing dynamics of business makes it evident that the new opportunities will come from the gaps & needs in the market. Therefore, the need is to be alert enough to notice these new happenings & tap them as & when they arise. The people in the company are its most important asset but the real focus should be on delivering on the promises undertaken. The company also stresses out that the incumbents should have that urge & self belief so that they are confident enough of driving the innovation & change drives that they think are essential. The company believes in being innovative & tenacious enough to open a new domains & horizons of business & hence regularly in the process of developing new products & offerings state of art services to all its clients, Brokers & agents in the business. Further, with the growing symbiosis of technology in the business the company also focuses on this aspect in the sense that it takes e-commerce & technology on a very high priority with increasing resource being targeted at the new business economy & the internet.
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CHAPTER 4
IRDA
THE INSURANCE REGULATORY AND
DEVELOPMENT AUTHORITY
4.1 Duties, Powers and Functions
Section 14 or IRDA Act, 1999 lays down the duties, powers and functions of IRDA.
Subject to the provisions of this act and any other law for the time being in force, the authority shall have the duty to regulate, promote and ensure orderly growth of the insurance business and re-insurance business.
Without prejudice to generally of the provisions contained in sub-section (1), the powers and functions of the authority shall include.
1. 1.Issue to the applicant a certificate of registration, renew, modify, withdraw, suspend or cancel such registration;
2. Protection of the interests of the policy holders in matters concerning assigning of policy, nomination by policy holders, insurable interest,
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settlement of insurance claim, surrender value of policy and other terms and conditions of contracts of insurance;
3. Specifying requisite qualifications, code of conduct and practical training for intermediary or insurance intermediaries and agents;
4. Specifying the code of conduct for surveyors and loss assessors;
5. Promoting efficiency in the conduct of insurance business;
6. Promoting and regulating professional organizations connected with the insurance and re-insurance business;
7. Levying fees and other charges for carrying out the purpose of this act;
8. Calling for information from, undertaking inspection of, conducting inquiries and investigations including audit of the insurers, intermediaries, insurance intermediaries and other organizations connected with insurance business;
9. Control and regulation of the rates, advantages, terms and conditions that may be offered by insurer in respect of general insurance business not so controlled and regulated by the tariff advisory committee under section 64U of the insurance act, 1938(4 of 1938)
10. 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;
11. Regulating investment of funds by insurance companies;
12. Regulating maintenance of margin of solvency;
13.Adjudication of disputes between insurers and intermediaries or insurance intermediaries;
14. Supervising the functioning of the tariff advisory committee;
14. Specifying the percentage of premium income of he insurer to finance schemes for promoting and regulating professional organization referred to in clause(f);
15. Specifying the percentage of life insurance business and general insurance business to be undertaken by the insurer in the rural or social sector; and
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16.Exercising such other powers as may be prescribed;
4.2 Essentials for the license
The IRDA has prescribed both qualifications and disqualification for a person to be given a license.
4.3 Qualifications
The person must: -
Be at least 18 years of age;
Have passed at least 12th standard or more (if he is appointed in a place with population 5000 or more), 10 th standard otherwise;
Have undergone training for at least 100 hours in life or general insurance business as the case may be from an institution, approved and notified by the authority;
Should have also passed the pre-recruitment examination conducted by the Insurance Institute of India or any other examination body recognized by the authority.
In case of an applicant for the composite insurance agent, he/she should have completed at least 150 hours practical training in life & general insurance business, which may be spread over six to eight weeks.
4.4 Disqualification’s
The factors that would debar a person from obtaining a license are that he/she
Has been found to be unsound mind by a court of competent jurisdiction
Has been found guilty of criminal breach of trust, misappropriation, cheating, forgery an abatement or attempt to commit any such offence.
The license once issued can be cancelled whenever the person acquires a disqualification. In the case of companies & firms who want to become agents, the test of qualification & disqualification would be applied to all the directors or partners.
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There are two separate forms, one for individuals & another for those other than individuals, in which the applicant are to be made. The two forms are numbered by IRDA-Agent VB & are annexed to the regulation. The applications in the respective forms have to be made to the designated person appointed buy the insurer sponsoring the application.
The application for the license should be accomplished by proofs.
Of fee having been remitted to the authority.
Of age
Of having completed the training & passed the prescribed examination.
The fee to be sent to the authority directly is Rs. 250 for new license & for renewals applied for within the prescribed period, viz, at least 30 days before the date of expiry. If the application were made after the date of expiry it would be normally refused. But, if the authority is satisfied that hardship would be caused Otherwise, the license may be renewed. Prior to renewal of the license of the license the agent should have completed at least 25 hours practical training in life or general insurance business or at least 50 hours practical training in life & general insurance business in the case of a composite insurance agent.
4.5 The Duties & Obligations of the Agent
As per the IRDA guidelines every advisor must be trained & licensed to sell life insurance. The responsibilities & obligations of the advisors have been clearly defined.
Every insurance agent should himself & the insurance company that he represents along with the license particulars.
The advisors should take into the actual needs of the clients before recommending a plan.
All requisite information in respect of the products recommended should be provided with a ‘Sales Illustration’ & the premium to be paid.
The agent is obligated to disclose the scales of commission likely to be earned by him through sale of the recommended product, should the client with to know it.
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The nature of information required in the application form should be adequately explained along with requirement for supporting documents.
Once the proposal is submitted, the advisor shall inform the status of decision by insurer promptly.
In case of a claim, the advisor is required to render necessary assistance in complying with the requirements for settlement of claims by the insurer.
He/She should not interfere with any proposal introduced by any other any insurance advisor/agent or force the client to terminate an existing policy taken from him/her & take a new proposal within 3 years.
An advisor cannot induce the client to omit any material information or submit any wrong information in the proposal form.
Further no rebating or offering any inducements in lieu of taking a policy is allowed.
4.6 Code of Conduct for the Agent
The license of Insurance Agent Regulation, 2000 lays down a code of conduct for the agents which state that he agent shall
Disclose the license to the prospect on demand.
Explain all available option to the prospect.
Disclose the scales of commission, if asked for by the prospect.
Impress upon the prospect need to disclose all information.
Inform the insurer about any adverse habits & materials facts of the person to be insured.
Convey to the proper about the acceptance on rejection of the proposal.
Render necessary assistance to policy holders or claimants or beneficiaries in complying with the requirements, asked for by the insurer. Advise policy holders to affect nomination.
Make every attempts to ensure remittance of premiums by the policy holders within the stipulated time by giving notice orally or in written.
Not induce the prospect to submit any wrong information.`-42-
Not interface with the proposal introduced by other insurance agents.
Not demand or receive share of proceeds under an insurance contract.
Not cause the termination of an existing policy with a view to effect a new proposal.
CHAPTER –5
PROJECT PROFILE
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PROJECT PROFILE 5.1 PROJECT TITLE:
“CHANNEL DEVELOPMENT” IN ICICI PRUDENTIAL LIFE INSURANCE COMPANY, SRI GANGANAGAR.
5.2 RESEARCH OBJECTIVE
The objective of the research done for the company was to know about the current perception about the company & its products. Moreover the secondary aim was also to increase the company’s database of prospects by getting the contacts of the respondents. However, if looked into the questionnaire the purpose of attracting the incumbents towards the company & its network of channel was on whole quite successful exercise.
5.3 RESEARCH METHODOLOGY
Sample frame
The area for the study was preferably south Delhi but as per requirement & the availability of the respondents some use to stay at very corners of the
The respondents were mostly in the age group of 25-60 years, as these were the people who are the target for the company’s products as well as company’s aim of increasing & development its channel network.
The respondents were from all walks of life that included services, business & even housewives. The respondents were like MBA’s, businessmen, self-employed, CA’s Advocates & other professionals.
The sample size was very much limited to the area of study. About 300 people were contacted & roughly 50 were present for one to one interaction.
Methodology Adopted
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As for the prospecting of the respondents is concerned, random sampling from the existing database & telecalling was used extensively.
Next step involved was of suspecting which was initiated by getting the appointment & having a personal interaction.
The sales pitch was provided with the help of business opportunity presentation & also with discussion & interviews conducted.
The last step was getting the questionnaire & the application form filled up with the required payment, training undertaken & depositing the form with DOPS.
The basics of the insurance business in India are governed by the agency law, which is part of the Indian Contracts Act, 1872. Further, after the industry got opened up the regulatory authority has been the insurance regulatory and development authority (IRDA).
5.4 SIGNIFICANCE OF STUDY
This project has great significance to the researches.
1. This study has proved the researches a practical knowledge of recruitment of advisors.
2. The study also helped the researches in partial fulfilled of MBA curricular.
5.6 LIMITATIONS OF THE STUDY
The results are not a very reflection of the current market behavior.
Due to limited time period & constrained working hours for most of the respondents the answers at times were vague enough to be ignored.
The database at disposal contained contacts that were initially not useful.
Most of the people in India take their policies in the period preceding March (for tax saving purpose) & so the response to initial contacts were not all encouraging & that has been the prime reason in the inability to quantify the results large enough so as to infer any relevant outcomes.
Most of the results that are spelt out have been of qualitative aspects.
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CHAPTER – 6
FACTS AND FINDINGS
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6.1 THE RESEARCH FINDINGS
Most of the people contacted were aware of the company but were very much unaware of He Company’s product & their comparative advantages over the competition in the market.
Being an insurance advisor is seen as an additional source of income & not a full time employment by most of the people, least a career.
There were respondents who were existing advisor of other companies but were interested in getting their family members registered as the company’s advisor.
The target population for the study was mostly the self-employed segment so the urge to earn more money sitting at home was very much evident.
The biggest hurdle in getting the process completed was the obligation to undergo 100 hours of training. Most of the people were very reluctant in undergoing training which was time consuming & disturbing to their primary work.
Even the option of online training was not that impressive to them due to lack of computer knowledge.
Further, the next problem that was evident was prescribed fee of Rs. 1,000 was at times too much for the people specially for those who come in the lower middle class but who do possess a good social network & could be a viable option for the company.
As regard the perception of the company is concerned the most outstanding factor that stood out was the inability, on the respondent’s side, to differentiate between the ICICI Prudential & the LIC. Moreover the Policies of the LIC were also casting their effect on the benefits being spelt out to the prospect.
Another important factor for the company was that all the respondents were aware of the ICICI brand name & hence the company’s name & its international linkage is likely to pay off in the coming period of time.
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CHAPTER – 7
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CONCLUSIONS AND SUGGESTIONS
CONCLUSIONS
7.1 Conclusions
The company is in the regular process of investing considerably in expanding the advisor base & administration & building infrastructure to meet demand in the increasing market.
The company’s group business is also beginning to show result, with restructured group gratuity, superannuating & term products attracting 85 corporate clients.
A new employee goes through a two day induction module which introduces him/her to the life insurance industry, concepts of life insurance, the shared values of the company as well as information on the company & core business processes, which is reinforced through an intranet based induction module which can be accessed anywhere, anytime.
Training focuses on a learning architecture addressing both developments of generic & functional competencies comprising the four areas of leadership, business mastery, personal effectiveness & functional mastery.
The attrition for the company is 1.5%. It believes that people stay with for the excitement & learning they get at the workplace.
The compensation strategy is based on the threefold model of pay for Performance, Pay for he Job & Pay in line with the market.
The company anticipates the market place to get increasingly competitive & it believes that its first mover advantage will pay rich dividends & enable to consolidate the leadership position amongst the private sector insurance players.
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Being an ICICI Prudential insurance advisor can be one of the most rewarding careers you will find. It is also hard work. But at ICICI Prudential life, your hard works pays off in the form of compensations & recognition.
SUGGESTIONS
7.2 Suggestions
Advisors should accomplish their work sincerely.
Advisors should receive their commission as it is decided.
Advisors should cover all the areas and classes of society for deriving maximum benefits.
The company should protect the advisors right and laws for their betterment.
Insurance policy should be affordable for the entire customer.
Advisors should be make better relations with customers.
Recruitment procedure of advisors is very elaborate and laborious task so it should be shortened & more and less time consuming.
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BIBLIOGRAPHY
BIBLIOGRAPHY
www.indianfoline.com
www.businessstandard.com
www.bimaonline.com
www.iciciprulifeinsurance.com
SMART INVESTOR
GUIDEBOOK TO THE IRDA
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ECONOMIC TIMES
THE HINDU
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