summer project of icici prudential

8/14/2019 Summer Project of ICICI Prudential

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A

PROJECT

ON

TO STUDY THE BEHAVIORAL PATTERN OF THEINVESTORS FOR LIFE INSURANCE

FOR

ICICI PRUDENTIAL LIFE INSURANCE

COMPANY LTD.

PATAN

Submitetd to

Dr. Ashwin Modi

( Faculty member )

S.K School of Business Management

Hemchandracharya North Gujarat University, Patan.

(In Partial fulfillment of the Requirement for the subject of'Entrepreneurship Development And Project Mgt as a part ofSemester-II in Post Graduate Diploma In Financial Services

Management'.)

SUBMITTED BY :-

Tejas Soni (36)

Ashwin Chaudhary (15)

Nima Patel (22)

Sunita Prajapati (27)


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ACKNOWLEDGEMENT

On this occasion, I would also like to thank to all those people who have

helped me directly or indirectly during my project work.

I would like to thank Our H.O.D. Mr. Nishit Bhatt who has given me

such opportunity which will help me in my future. I am also very thankful to my

project guide Mr. Ashwin Modi for providing the full guidance during my

project work and motivated me through out the fulfillment of my project.

I am very thankful to ICICI Prudential Life Insurance Company Limited

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

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

manager of ICICI Prudential Life Insurance Company Limited -Patan and Mr.

Mehul Parmar the Unit manager of ICICI Prudential Life Insurance Company

Limited -Patan for giving me training in my project.

And at last but not the least I also express my sincere thanks to all my

respondents, without their cooperation and help; I could not be able to complete

my study.

Tejas Soni

Ashwin

Chaudhary

Nima Patel

Sunita Prajapati


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EXECUTIVE SUMMARY

The project topic assigned to me was To study the behaviour pattern

of Investors for Life insurance at ICICI Prudential Life Insurance Company

Ltd, Surat.

The sample size was 50. The data was collected through contacting

personal Interview. The approach to interview was questionnaire. Analysis

includes the behavior pattern of the investors. At the time of investment

actually what they keep in mind to invest money. How they approach to life

insurance.

This report talks about the behavioral pattern of the investors in life

insurance policies. While building up the report there are various things,

which we have found out like there are many people who are interested in

investing in life insurance policies for reasons like education for children, tax

benefits, increasing wealth and many more.

This study will also throw light on how their profile affect the behavior

pattern of the investors.


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TABLE OF CONTENTS

No. Contents Page No.1 Industry Profile

2 Company Profile

3 Research Methodology

Research objective

Research design

Sources of data

Research approach

Research instrument

Sampling plan

Limitations

4 Data Analysis

5 Conclusion

6 Annexure

7 Bibliography


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BRIEF HISTORY OF INSURANCE

Life Insurance in its modern form came to India from England in the year 1818. Oriental

Life Insurance Company started by Europeans in Calcutta was the first life insurance

company on Indian Soil. All the insurance companies established during that period were

brought up with the purpose of looking after the needs of European community and

Indian natives were not being insured by these companies. However, later with the efforts

of eminent people like Babu Muttylal Seal, the foreign life insurance companies started

insuring Indian lives. But Indian lives were being treated as sub-standard lives and heavy

extra premiums were being charged on them. Bombay Mutual Life Assurance Society

heralded the birth of first Indian life insurance company in the year 1870, and covered

Indian lives at normal rates. Starting as Indian enterprise with highly patriotic motives,

insurance companies came into existence to carry the message of insurance and social

security through insurance to various sectors of society. Bharat Insurance Company

(1896) was also one of such companies inspired by nationalism. The Swadeshi movement

of 1905-1907 gave rise to more insurance companies. The United India in Madras,

National Indian and National Insurance in Calcutta and the Co-operative Assurance at

Lahore were established in 1906. In 1907, Hindustan Co-operative Insurance Company

took its birth in one of the rooms of the Jorasanko, house of the great poet Rabindranath

Tagore, in Calcutta. The Indian Mercantile, General Assurance and Swadeshi Life (later

Bombay Life) were some of the companies established during the same period. Prior to

1912 India had no legislation to regulate insurance business. In the year 1912, the Life

Insurance Companies Act, and the Provident Fund Act were passed. The Life Insurance

Companies Act, 1912 made it necessary that the premium rate tables and periodicalvaluations of companies should be certified by an actuary. But the Act discriminated

between foreign and Indian companies on many accounts, putting the Indian companies

at a disadvantage.


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The first two decades of the twentieth century saw lot of growth in insurance business.

From 44 companies with total business-in-force as Rs.22.44 crore, it rose to 176

companies with total business-in-force as Rs.298 crore in 1938. During the mushrooming

of insurance companies many financially unsound concerns were also floated which

failed miserably. The Insurance Act 1938 was the first legislation governing not only life

insurance but also non-life insurance to provide strict state control over insurance

business. The demand for nationalization of life insurance industry was made repeatedly

in the past but it gathered momentum in 1944 when a bill to amend the Life Insurance

Act 1938 was introduced in the Legislative Assembly.

However, it was much later on the 19th of January, 1956, that life insurance in

India was nationalized. About 154 Indian insurance companies, 16 non-Indian companiesand 75 provident were operating in India at the time of nationalization. Nationalization

was accomplished in two stages; initially the management of the companies was taken

over by means of an Ordinance, and later, the ownership too by means of a

comprehensive bill. The Parliament of India passed the Life Insurance Corporation Act

on the 19th of June 1956, and the Life Insurance Corporation of India was created on 1st

September, 1956, with the objective of spreading life insurance much more widely and in

particular to the rural areas with a view to reach all insurable persons in the country,

providing them adequate financial cover at a reasonable cost.

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

1818: Oriental Life Insurance Company, the first life insurance company on

Indian soil started functioning.

1870: Bombay Mutual Life Assurance Society, the first Indian life insurance

company started its business.

1912: The Indian Life Assurance Companies Act enacted as the first statute to

regulate the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to

collect statistical information about both life and non-life insurance businesses.


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1938: Earlier legislation consolidated and amended to by the Insurance Act with

the objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies are taken over by

the central government and nationalised. LIC formed by an Act of Parliament,

viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the

Government of India.

The General insurance business in India, on the other hand, can trace its roots to the

Triton Insurance Company Ltd., the first general insurance company established in the

year 1850 in Calcutta by the British.

The Indian insurance industry is segmented into two distinct markets: the life insurancemarket and the non-life, or general, insurance market. The history of life insurance in

India can be traced from 1818.


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THE KEY FEATURES OF LIFE INSURANCE INDUSTRY

Nomination: -When one makes a nomination, as the policyholder you continue to be the

owner of the policy and the nominee does not have any right under the policy so long as

you are alive. The nominee has only the right to receive the policy monies in case of your

death within the term of the policy.

Assignment :-If your intention is that your policy monies should go only to a particular

person, you need to assign the policy in favor of that person

Death Benefit: -The primary feature of a life insurance policy is the death benefit it

provides. Permanent policies provide a death benefit that is guaranteed for the life of the

insured, provided the premiums have been paid and the policy has not been surrendered.

Cash Value: -The cash value of a permanent life insurance policy is accumulated

throughout the life of the policy. It equals the amount a policy owner would receive, after

any applicable surrender charges, if the policy were surrendered before the insured's

death.

Dividends: -Many life insurance companies issue life insurance policies that entitle the

policy owner to share in the company's divisible surplus.

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

used in numerous ways, one of which is toward the purchase of additional coverage,

called paid-up additions.

Policy Loans: -Some life insurance policies allow a policy owner to apply for a loan

against the value of their policy. Either a fixed or variable rate of interest is charged. This

feature allows the policy owner an easily accessible loan in times of need or opportunity.

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

individuals often purchase term life insurance. If one owns a term policy, sometimes a

provision is available that will allow her to convert her policy to a permanent one without

providing additional proof of nsurability.


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Disability Waiver of Premium

Waiver of Premium is an option or benefit that can be attached to a life insurance policy

at an additional cost. It guarantees that coverage will stay in force and continue to grow.

THE BENEFITS OF LIFE INSURANCE

Risk cover: -Life Insurance contracts allow an individual to have a risk cover against any

unfortunate event of the future.

Tax Deduction: - Under section 80C of the Income Tax Act of 1961 one can get tax

deduction on premiums up to one lakh rupees. Life Insurance policies thus decrease the

total taxable income of an individual.

Loans: - An individual can easily access loans from different financial institutions by

pledging his insurance policies.

Retirement Planning: - What had provided protection against the financial

consequences of premature death may now be used to help them enjoy their retirement

years. Moreover the cash value can be used as an additional income in the old age.

Educational Needs: - Similar to retirement planning the cash values that flow from ones

life insurance schemes can be utilized for educational needs of the insurer or his children.

ROLE OF LIFE INSURANCE IN THE GROWTH OF THE ECONOMY

The Life Insurance Industry has an enviable track record among public sector units. It has

a Consistent profit and dividend paying record accompanied by a steady growth in its

financial resources. Through investments in the Government sector and socially- oriented

sectors the Industry has contributed immensely to the nation's development. The industry

is recognized as one of the largest financial Institutions in the country. The ventures

initiated by the industry in the areas of Mutual Fund, Housing Finance has done

exceedingly well in recent years. To protect the country's foreign exchange reserves, the


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reinsurance arrangement are so organized that maximum retention is made possible

within the country while at the same time protecting interests of the policy holders.

INDIA AGAINST THE GLOBAL MARKETS

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

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

Insurable population only 10% of Indias population have life insurance According

to ING only 10% of the population is insured, which represents around 30% of the

insurable population. This suggests more than 300m people, with the potential to buy

insurance, remain uninsured

Global perspective India ranks 19th on the global stage

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

premiums. As of 2004 the largest markets in size are the US (50x bigger than India),

Japan and the UK. Out of the Asian countries (ex Japan), South Korea is the largest

insurance market, Comprising 2.12% of global premiums, followed by China with

1.61%.

While insurance continues to reach out to the masses, Indias insurance penetration

(premiums as a percentage of GDP) still remains very low at 3.2%. This can be split

between life penetration of 2.6% and non-life of 0.6%. On the world stage, penetration

rates are significantly below developed markets such as the US (9.4%), UK (12.6%) and

Australia (8%). Compared with Asian markets, India still falls well short of its nearest

peers with countries such as Japan, South Korea and Taiwan having some of the highest

penetration rates in the world (between 9% and 14%). Nevertheless, despite current low

spend on insurance, the trends in India remain positive. Since the opening up of the

market to foreign players in 2000, penetration has more than doubled from 1.5%. With

foreigners gaining momentum and building the insurance, coupled with Indias favorable

macro overlay, we expect penetration rates to continue to expand.


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FUTURE OF LIFE INAURANCE SCHEMES

The Indian Life insurance sector will register a high growth rate in the future years to

come says the report prepared by Fitch Ratings. This will be due to the innovative

products, better distribution network, better services coupled with other never-before

changes that have taken place in the insurance sector.

In Nov 2005 the Indian Life insurance industry saw a growth of 46 %. This rally is

expected to continue as people realize the importance of risk management. The private

sector players are expected to grow with their innovative and profitable life insurance

schemes.

INSURANCE REGULATORY AUTHORITY

On the recommendation of Malhotra Committee, an Insurance Regulatory Development

Act (IRDA) passed by Indian Parliament in 1993. Its main aim was to activate an

insurance regulatory apparatus essential for proper monitoring and control of the

Insurance industry.

Due to this Act several Indian private companies have entered into the insurance market,

and some companies have joined with foreign partners. In economic reform process, the

Insurance Companies has given boost to the socio-economic development process. The

huge amount of funds that are at the disposal of Insurance Companies are directed as

desired avenues like housing, safe drinking water, electricity, primary education and

infrastructure. Above all the policyholders gets better pricing of products from

competitive insurance companies.

Liberalization

The opening up of Insurance sector was a part of the ongoing liberalization in the

financial sector of India. The domain of State-run insurance companies was thrown open

to private enterprise on December 7, 1999, with the introduction of the Insurance

Regulatory and Development Authority (IRDA) Bill. The opening up of the sector gave


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way to the world known names in the industry to enter the Indian market through tie-ups

with the eminent business houses. What was once a quiet business is becoming one of the

hottest businesses today.

Post liberalization

The changing face of financial sector and the entry of several companies in the field of

Life Insurance segment are one of the key results of these liberalization efforts. Insurance

business by way of generating premium income adds significantly to the GDP. Despite

the fact that the market is vast in India for the Insurance business, the coverage is far less

compared with the international standards. Estimates show that a meager 35-40 million,

out of a population of 950 million, have come so far under the umbrella of the insurance

industry. The potential market is so huge that it can grow by 15 to 17 per cent per annum.

With the entry of private players, the Indian Insurance Market may finally be able to

make deeper penetration in to newer segments and expand the market size manifold. The

quality of service will also improve and there will be wide The Life insurance market in

India is likely to be risky in the initial stages, but this will improve in the next three to

five years Therefore, it may be advantageous to be a second-round entrant. In the Life

insurance market the need risk assessment systems and data that are the key to success in

the Life insurance market are significantly underdeveloped in India even today.

MAJOR MARKET PLAYERS

Presently there are 15 Life insurance companies in the country. There is only one public

sector company LIC and the rest 14 are private sector. Although LIC has been

dominating the Life Insurance business since past few years the private players have now

started to take the momentum.


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Major market players

Life Insurance Corporation of India (LIC)

Life Insurance Corporation of India is a 100% government held Public Sector Company.Being the first to be established LIC is the forerunner in the Life Insurance sector. The

market share for the first eight months of FY 2005-06 is 73.91%.

ICICI Prudential Life Insurance

ICICI Prudential Life is a 74:26 joint venture between ICICI and Prudential. It is a

private sector company. The company was registered on 24/11/2000. The market share

for the first eight months of FY 2005-06 is 7.11%.

Birla Sun Life Insurance Company

Birla Sun Life Insurance Company is a 74:26 joint venture between Birla group and Sun

Life Financial. It is a private sector company. The company was registered on 31/1/2001.

The market share for first the eight months of FY 2005-06 is 1.84%.

HDFC Standard

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

sector company. The company was registered on 23/10/2000. The market share for the

first eight months of FY 2005-06 is 2.96%.

OM Kotak Mahindra old Mutual

OM Kotak Mahindra is a 74:26 joint venture between Kotak Mahindra bank and OldMutual. It is a private sector company. The company was registered on 10/1/2001. The



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Royal Sundaram

Royal Sundaram marks the coming together of Sundaram Finance, one of Indias most

respected and trusted finance companies, and Royal and Sun Alliance, one of the largest

insurance groups in the world.

Max New York Life

Max New York Life is a 74:26 joint venture between J & Bank, Pallonji & Co and

MetLife. It is a private sector company. The company was registered on 6/8/2001. The


AMP SANMAR

Amp Sanmar was purchased by Reliance group in 3Q2005. It was registered as a private

sector insurance company on 3/1/2002.The market share for the first eight months of FY

2005-06 is 0.54%.

Aviva Life Insurance India

Aviva Life insurance is a 74:26 joint venture between Aviva and Dabur. It is a private

sector company. The company was registered on 14/5/2002. The market share for the

first eight months of FY 2005-06 is 1.12%.

ING Vysya Life insurance

ING Vysya Life Insurance is joint venture between Exide (50%), Gujarat Cements

(14.87%), Enam (9.13%) and ING (26 %). It is a private sector company. The company

was registered on 2/8/2001. The market share for the first eight months of FY 2005-06 is

0.63%.


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Met Life India

Met Life India is a 74:26 joint venture between 74:26 JV between J & Bank, Pallonji &

Co and MetLife. It is a private sector company. The company was registered on 6/8/2001.

The market share for the first eight months of FY 2005-06 is 0.40%.

Allianz Bajaj Life Insurance Co.

Allianz Bajaj Life Insurance Company is a 74: 26 Joint venture between Bajaj Auto

limited and Allianz AIG. The company was registered on 3/8/2001.The market share for

the first eight months of FY 2005-06 is 6.12%.

SBI Life Insurance Company Ltd:

SBI Life Insurance Company is a 74: 26 Joint venture between SBI and Cardiff S.A. The

company was registered on 31/3/2001.It is a private sector company. The market share

for the first eight months of FY 2005-06 is 1.52%.

The TATA AIG Group

TATA AIG group is a 74:26 JV between Tata Group and AIG. It belongs to the private

sector. The company was registered on 12/2/2001. The market share for the first eight

months of FY 2005-06 is 1.78%.

Sahara India Life Insurance Company Ltd.

First Wholly Indian Owned Private Life Insurance Company. The Company commenced

operations from 30th October 2004.

Shriram life insurance company Ltd

Shriram Life is a recent entrant into the life insurance sector It is a 74:26 joint venture

between the Shriram group through its Shriram Financial Holdings and Sanlam Life

Insurance Limited, South Africa. The company expects to start operations soon.


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PRODUCT RANGE

Life insurance is all about making sure your family has adequate financial resources to

make those plans and dreams come true. It provides financial protection to help your

family or business to manage after your death.

Whole life policies - Cover the insured for entire life. The insured does not receive

money while he is alive; the nominee receives the sum assured plus bonus upon death of

the insured.

Endowment policies - Cover the insured for a specific period. The insured receives

money on survival of the term and is not covered thereafter.

Money back policies - The nominee receives money immediately on death of the

insured. On survival the insured receives money at regular intervals during the term.

These policies cost more than endowment with profit policies.

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

determined time and not immediately on death of the insured. On survival the insured

receives money at the same pre-determined time. These policies are best suited for

planning children's future education and marriage costs.

Annuities/Pension schemes - are policies that provide benefits to the insured only upon

retirement. If the insured dies during the term of the policy, his nominee would receive

the benefits either as a lump sum or as a pension every month.

Since a single policy cannot meet all the insurance objectives, one should have a portfolio

of policies covering all the needs.


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THE MAJOR DISTRIBUTION CHANNELS

Retail Banks

While a lot of bank relationships with insurance companies have been established, lifeinsurance sales have been slower than one would expect he primary bank insurance

activities have been the distribution of annuities, credit life, and direct marketing

insurance. Banks are failing to incorporate successful sales tactics used to sell other

financial services like investments.

Full-Service Brokers

Brokerage firms have gained much of the institutional and personal trust business lost bythe banks. These firms have steadily captured assets, primarily at the expense of the

banks. The number of non-bank trust companies has increased in recent years as

independent trust companies have emerged and more broker/dealers are integrated

services. Insurance companies view full-service brokers as a potentially new distribution

channel as well.

Discount Brokers and Online Financial Services

Direct sales of life insurance are growing rapidly, but many of the traditional full-serve

players seem to be letting it go. Across all financial services, consumers are expressing a

willingness to deal with a variety of providers on the web. Web sites are starting to pop

up offering consumer insurance products especially designed for distribution over the

web.

Independent Advisors

To gain a better understanding of the demand amongst independent advisors for trust

services and to gain a better feel for how independent advisors handle trust services, a

research was performed with independent advisors across several broker/dealers and

custodians. The interviews revealed that demand is greatest for living trusts among

independent advisors, followed by demand for corporate trustee services.


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Life Insurance Agents, CPAs, & Lawyers

Independent insurance agents represent a number of companies and can research these

companies products to find the right combination for their clients. Independent agents &

insurance producer groups are growing in prevalence. Although producer groups are in

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

financial services. Independent shops realized that by pooling production and funding a

central support office, they had increased buying power.

PERFORMANCE

A robust 36 per cent increase in business by country's largest insurer LIC and strong

performance by most of the private players pushed the overall life insurance growth to 46

per cent in April-November 2005. With competition intensifying, the 14 life-insurers

collected Rs 16,604 crores in new premium in the first eight months of 2005-06

compared to Rs 11,337 crores in the year ago period, according to data compiled by

regulator IRDA. State-owned Life Insurance Corporation gave a tough fight to private

players, who were fast increasing their market share, to collect Rs 12,271 crores in new

premium by selling over 1.3 crores policies.

The 13 private players led by ICICI Prudential and Bajaj Allianz are leaving no stones

unturned to expand business by netting more policyholders to increase their market share.

Among private players, ICICI Prudential ranked at the top by collecting about Rs 1,180

crores after logging 73 per cent growth, followed by Bajaj Allianz, which increased

business by 264 per cent to collect Rs 1,016 crores in premium. ICICI Prudential had a

market share of 7.11 per cent while Bajaj Allianz increased its market pie to 6.12 per

cent.


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HDFC Standard Life had a market share of 2.96 per cent, followed by Birla Sunlife (1.84

per cent), Tata AIG (1.78 per cent), SBI Life (1.52 per cent), Max New York Life (1.32

per cent) and Aviva (1.12 per cent). Other players -- Kotak Mahindra Old Mutual, ING

Vysya, AMP Sanmar, Met Life and Sahara Life -- each had less than one per cent of the

market.

HDFC Standard collected Rs 491 crores in premium income till November, followed

Birla Sunlife (Rs 305 crores), Tata AIG (Rs 296 crores), SBI Life (Rs 252 crores), Max

New York Life (Rs 219 crores) and Aviva (Rs 186 crores).

In group insurance, LIC continued to dominate with a market share of about 81.32 per

cent by covering 8.638 million lives till November this fiscal. Among the private

insurers, SBI Life was at the top with a market share of 5.27 per cent, followed by Tata

AIG (4.16 per cent), ICICI Prudential (2.34 per cent), Met Life (1.9 per cent), Aviva

(1.16 per cent) and Bajaj Allianz (1.14 per cent).

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

2005

l.No Insurer Market Sahre(%)

1 LIC 73.91

2 Bajaj Allianz 6.12

3 ING Vysya 0.63

4 AMP Sanmar 0.54

5 SBI Life 1.52

6 Tata AIG 1.78

7 HDFC Standard 2.96

8 ICICI Prudential 7.11

9 Birla SunLife 1.8410 Aviva 1.12

11 Kotak Mahnidra Old Mutual 0.71

12 Max New York 1.32

13 Met Life 0.40

14 Sahara Life 0.06


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COMPANY PROFILE

India's Number One private life insurer, ICICI Prudential Life Insurance Company isa joint venture between ICICI Bank-one of India's foremost financial services

companies-and Prudential plc- a leading international financial services group

headquartered in the United Kingdom. Total capital stands at Rs. 18.15 billion, with

ICICI Bank holding a stake of 74% and Prudential plc holding 26%.

They began their operations in December 2000 after receiving approval from

Insurance Regulatory Development Authority (IRDA). Today, the PruICICI having

nation-wide team comprises, about 450 branches, over 150,000 insurance advisors

and 18 bancassurance partners.

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

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

VISION:

To make ICICI Prudential the dominant Life and Pensions player built on trust by

world-class people and service.

IT WILL BE ACHIEVED THROUGH:

Understanding the needs of customers and offering them superior products and

service

Leveraging technology to service customers quickly, efficiently and

conveniently


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Developing and implementing superior risk management and investment

strategies to offer sustainable and stable returns to our policyholders

Providing an enabling environment to foster growth and learning for our

employees

building transparency in all their dealings.

VALUES:

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

Customer First, Boundaryless, Ownership, and Passion.

ABOUT COMPANIES

ICICI Bank is India's second largest bank and largest private sector bank with

assets of Rs. 2823.72 billion as on September 30, 2006. ICICI Bank provides a broad

spectrum of financial services to individuals and companies. This includes

mortgages, car and personal loans, credit and debit cards, corporate and

agricultural finance. The Bank services a growing customer base through a multi-

channel access network which includes over 635 branches and extension counters,

2325 ATMs, call centers and Internet banking.

Prudential

Established in London in 1848, Prudential plc, through its businesses in the UK and

Europe, the US and Asia, provides retail financial services products and services to more

than 21 million customers, policyholder and unit holders worldwide. As of June 30, 2006,

the company had over 234 billion in funds under management. Prudential has brought to

market an integrated range of financial services products that now includes life assurance,

pensions, mutual funds, banking, investment management and general insurance. In Asia,

Prudential is the leading European life insurance company with a vast network of 23 life


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and mutual fund operations in twelve countries - China, Hong Kong, India, Indonesia,

Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand and Vietnam.

For the past six years, ICICI Prudential has retained its position as the No. 1 private

life insurer in the country, with a wide range of flexible products that meet the needs

of the Indian customer at every step in life.

Distribution

ICICI Prudential has one of the largest distribution networks amongst private life insurers

in India. As of December 31, 2006 it had commenced operations in over 360 cities and

towns in India, stretching from Bhuj in the west to Guwahati in the east, and Jammu in

the north to Trivandrum in the south, and had over 175,000 advisors.

The company has 18 bancassurance partners, having tie-ups with ICICI Bank, Bank of

India, Federal Bank, South Indian Bank, Lord Krishna Bank, all regional rural banks

sponsored by Bank of India, as well as some co-operative banks. It has also tied up with

NGOs, MFIs and corporates for the distribution of rural policies.

Products

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

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

to 4 riders, to create a customized solution for each policyholder.

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

savings plan that offers 3 levels of protection as well as liquidity options.

Save'n'Protect is a traditional endowment savings plan that offers life protection

along with adequate returns.


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CashBak is an anticipated endowment policy ideal for meeting milestone

expenses like a child's marriage, expenses for a child's higher education or

purchase of an asset. It is available for terms of 15 and 20 years.

LifeTime Super & LifeTime Plus are unit-linked plans that offer customers the

flexibility and control to customize the policy to meet the changing needs at

different life stages. Each offer 4 fund options - Preserver, Protector, Balancer and

Maximiser.

LifeLink Super is a single premium unit linked insurance Plan which combines

life insurance cover with the opportunity to stay invested in the stock market

Premier Life Gold is a limited premium paying plan specially structured for

long-term wealth creation.

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

the invested premiums and ensures that the customer receives only the benefits of

fund appreciation without any of the risks of depreciation.

InvestShield Cashbakis a unit linked plan that provides premium guarantee on

the invested premiums along with flexible liquidity options.

Protection Solutions

LifeGuard is a protection plan, which offers life cover at low cost. It is available

in 3 options - level term assurance, level term assurance with return of premium

& single premium.

HomeAssure is a mortgage reducing term assurance plan designed specifically to

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

Child Plans

Education insurance under the SmartKid brand provides guaranteed

educational benefits to a child along withlife insurance cover for the parent who

purchases the policy. The policy is designed to provide money at important


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milestones in the child's life. SmartKid plans are also available in unit-linked

form - both single premium and regular premium.

Retirement Solutions

ForeverLife is a traditional retirement product that offers guaranteed returns for

the first 4 years and then declares bonuses annually.

LifeTime Super Pension is a regular premium unit linked pension plan that helps

one accumulate over the long term and offers an annuity option (guaranteed

income for life) at the time of retirement.

LifeLink Super Pension is a single premium unit linked pension plan.

Immediate Annuity is a single premium annuity product that guarantees income

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

Health Solutions

Health Assure and Health Assure Plus: Health Assure is a regular premium plan

which provides long term cover against 6 critical illnesses by providing

policyholder with financial assistance, irrespective of the actual medical expenses.

Health Assure Plus offers the added advantage of an equivalent life insurance

cover.

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

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

Diabetes Care: Diabetes Care is the first ever critical illness product specially for

individuals with Type 2 diabetes. It makes payments on diagnosis on any of 6

diabetes related critical illnesses, and also offers a coordinated care approach to

managing the condition. Diabetes Care Plus also offers life cover.

Group Insurance Solutions


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ICICI Prudential also offers Group Insurance Solutions for companies seeking to enhance

benefits to their employees.

Group Gratuity Plan: ICICI Pru's group gratuity plan helps employers fund their

statutory gratuity obligation in a scientific manner. The plan can also be customized tostructure schemes that can provide benefits beyond the statutory obligations.

Group Superannuation Plan: ICICI Pru offers both defined contribution (DC) anddefined benefit (DB) superannuation schemes to optimise returns for the members of the

trust and rationalise the cost. Members have the option of choosing from various annuity

options or opting for a partial commutation of the annuity at the time of retirement.

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

superannuation customers, we offer immediate annuities to superannuation funds not

managed by us.

Group Term Plan: ICICI Pru's flexible group term solution helps provide affordable

cover to members of a group. The cover could be uniform or based on designation/rankor a multiple of salary. The benefit under the policy is paid to the beneficiary nominated

by the member on his/her death.

Flexible Rider Options

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

Accident & disability benefit: If death occurs as the result of an accident during

the term of the policy, the beneficiary receives an additional amount equal to the

rider sum assured under the policy. If the death occurs while traveling in an

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

assured as additional benefit.

Critical Illness Benefit: protects the insured against financial loss in the event of

9 specified critical illnesses. Benefits are payable to the insured for medical

expenses prior to death.

Income Benefit: This rider pays the 10% of the sum assured to the nominee every

year, till maturity, in the event of the death of the life assured. It is available on

SmarKid and CashPlus.


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Waiver of Premium: In case of total and permanent disability due to an accident,

the future premiums continue to be paid by the company till the time of maturity.

This rider is available with LifeTime Super, LifeTime Super Pension and

CashPlus

RESEARCH METHODOLGY

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

OBJECTIVES OF THE STUDY

Research Objectives:

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

2. To better know how the consumers profile affects their investment decision in

insurance.

3. To understand the positioning of life insurance products.

RESEARCH DESIGN

Marketing research can be classified in one of three categories:

Exploratory research

Descriptive research

Causal research

Descriptive research is more rigid then exploratory research and seeks to describe users

of a product, determine the proportion of the population that uses the product, or predict

the future demand for a product. As opposed to exploratory research, descriptive research


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should define questions, people surveyed, and the method of analysis prior to beginning

data collection. In other words the, who, what, where, when, why and how aspects of the

research should be defined. Such preparation allows the opportunity to make any required

changes before the costly process of data collection has begun.

There are two basic types of descriptive research: longitudinal studies and cross sectional

studies. Longitudinal studies are time series analyses that make repeated measurements of

the same individuals, thus allowing one to monitor behavior such as brand switching.

However, longitudinal studies are not necessarily representative since many people may

refuse to participate because of the commitment required. Cross sectional studies sample

of the population to make measurements at a specific point of time. A special type of

cross sectional analysis is a cohort analysis, which tracks an aggregate of individuals who

experience the same event within the same time interval overtime. Cohort analyses are

useful for long term forecasting of product demand.

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

collected

DATA COLLECTION

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

primary data, or both.

PRIMARY DATA

Primary data are data that freshly gathered for a specific purpose or for a specific

research project.


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The primary data is collected through the systematic market research survey. This survey

conducted through questionnaire, which have predefined specific objective questions.

The 150 respondents are contacted within the Surat city.

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

respondents.

SECONDARY DATA

Before going through the time and expenses of colleting primary data, one should check

for secondary data that previously may have been collected for other purposes but that

can be used in the immediate study. Secondary data may be internal to the firm, such assales invoices and warranty cards, or may be external to the firm such as published data

or commercial available data. The government census is a valuable source of secondary

data.

SECONDARY DATA SOURCES

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

The data collected from the following websites,

www.iciciprulife.com

www.irdaindia.org

Other sources of secondary data,

Various Brochers of ICICI Prudential Life Insurance.

LIMITATIONS

1. As this study is based on sample survey, therefore there might be chances of some

little variation from census survey.
http://www.irdaindia.org/http://www.irdaindia.org/


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2. Some of data are highly sensitive, therefore some of respondents might give

wrong information about their personal detail viz. Income

3. This survey is conducted within Patan city; therefore it might not be generalized

for other cities.


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ANALYSIS AND INTERPRETATION

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

10000-20000 20000-30000

30000-50000 more than 50000

Annualy Investment

48%

26%

18%

8%

10000-2000020000-3000030000-50000Above 500000

Interpretation:

From the Above Graph we can say that 26% of the respondents invest between

20000-30000, where 48% respondents invest between 10000-20000. 18%

respondents between 30000-50000 and only 8% respondents invest above50000.

Amount

Investing Respondent Percentage (%)

10000-20000 24 48

20000-30000 13 26

30000-50000 09 18

Above 500000 04 08

Total 50 100


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(2) For what purpose do you invest?

For child education and marriage

For increase wealth

For financial securities

Planning for retirement Long-term returns

Tax saving

Any other, please specify

Investment Purpose

8%

28%

12%4%

30%

18%Child education

Increase in

wealthFor financial

securitiesRetirement

Long term

returnTax saving

Purpose Respondent Percentage

Child education 04 08%

Increase in wealth 14 28%

For financial securities 06 12%Retirement 02 04%

Long term return 15 30%

Tax saving 09 18%

Total Respondents 50 100


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Interpretation:

From the Above Graph we can say that the purpose of most of respondents

was to invest for increasing wealth and long term return. The percentageswere 28% and 30 % respectively. 28% respondents invest for increase in

wealth. 04%, 30% and 12% respondents were investing for planning for

retirement, long term return and for financial securities respectively.

(3) Where do you invest your money?

Bank FD Mutual fund

Post office deposit Insurance

Shares Any other, please specify

Where to Invest

26%

16%

14%

24%

20%Bank FD

Mutual fund

Post office

deposite

Insurance

Shares

Interpretation:

Age group Respondent Percentage

Bank FD 13 26%

Mutual fund 08 16%

Post office deposite 07 14%

Insurance 12 24%

Shares 10 20%

Total 50 100


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from the above graph we can say that out of 50 respondents 13 respondents invest

in F.D. 07 invests in post office deposit. 12 in insurance and 08 in mutual fund. and10 invest in Shares.

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

LIC

ICICI Prudential

Bajaj- Alliance

TATA-AIG

Reliance life Birla sun life

HDFC standard life

Company Respondent Percentage

Bajaj Allianz Life Insurance 38 76.00%

ICICI Prudential life Insurance 42 84.00%

TATA- AIG 34 68.67%

Reliance Life Insurance 26 52.00%

LIC 50 100.00%

84.00%

68.67%

52.00%

100.00%76.00%

Bajaj Allianz Life

Insurance

ICICI Prudential

life Insurance

TATA- AIG

Reliance Life

Insurance

LIC

Interpretation:


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From the above graph we can say that LIC is the having the 100% awareness where

42 respondents were aware of ICICpru. 38 respondents were aware of Baja-alliance

and 34 were aware of TATA- AIG, where 26 were aware of reliance life.

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

Yes No

Invest in insurance

70%

30%

Yes

No

Interpretation:

From the above graph we can say that 70% from the respondents were having the

insurance policy where 30% respondents had not insurance policy.

Policy holder Respondent Percentage (%)

Yes 35 70

No 15 30

Total 50 100


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From the above graph we can say that 31 % of them having Policy for both purpose

where 38% of the respondents were used to invest for insurance cover only and

31% were used to invest for investment purpose.


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(7) In you family, who all posses an insurance cover?

My self

Spouse

Children

Parents Grand children

who posses insurance

29%

27%

15%

25%

4%

My self

Spouse

Children

Parents

Grand Children

Interpretation:

From the above graph we can say that 35 respondents have the policy for theirselves as well as their children, spouse, parents and grandchildren.

Gender Respondent

My self 32

Spouse 30

Children 17

Parents 28

Grand Children 04


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(08) At present are you interested in investing into life insurance policy?

Yes No

Interested in Investing in Life Insurance

82%

18%

Yes

No

Interpretation:

From the above graph we can say that 82% right who wants to invest in Life

insurance. And 18% were not ready to invest right now.

Gender Respondent Percentage (%)Yes 41 82

No 09 18

Total 50 100


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(09) Choose the insurance policy in which you would like to invest?

Investment only

Insurance only

Both

Investment pattern

18%

23%59%

Investment only

Insurance Only

Both

Interpretation:

From the above graph we can say that those who wants to invest most of them

59% wants invest for both the purpose Investment as well as insurance. Where

23% wants to invest for insurance purpose only and 18% wants to invest forInvestment purpose only.

Gender Respondent Percentage (%)

Investment only 09 18

Insurance only 11 23

Both 29 59

Total 50 100


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Personal Information :-

(1) Gender:

Male Female

Gender of respondent

90%

10%

Male

Female

Interpretation:

Form the above graph we can say that 90 % respondents are Male and 10%

respondents are Female.

Gender Respondent Percentage (%)

Male 45 10

Female 05 90

Total 50 100


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(2) Age Group:

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

Age group of Respondent

2%

68%

20%

8% 2%Below 25

25-35

35-45

45-55

Above 55

Interpretation:

Form the above graph we can say that 68 % respondents are between the age of 25-35

and 20% respondents are between 35-45. There were 02% respondents below 25,

08% between 45-55 and only 2% respondents were above 55 in my survey.

Age group Respondent Percentage (%)

Below 25 01 02

25-35 35 68

35-45 10 20

45-55 04 08

Above 55 01 02

Total 50 100


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(3) Marital Status: Married Unmarried

Gender of Respondent

76%

24%

Married

Unmarried

Interpretation:

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

respondents are unmarried.

Marital Status Respondent Percentage (%)Married 38 76

Unmarried 12 24

Total 50 100


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FINDINGS

In the survey it is found that among the private playerICICI prudential is doing well in the insurance sector.

People are Interested in investing in ICICIpru than other

private insurance company.

Most of the respondents having the income between 60000-

150000 and they usually investing in the different policy.

89 of the respondents have already invested indifferent plan

of insurance.

123 of the respondents are really interested in investing inInsurance.

People Who have invested in Insurance most of them are

having the plan which includes the purpose of Investment

as well as Insurance cover

Most of the respondents have the policy for their selves as

well as their family members.

The purpose of investment of most of the respondent was

for the Child education and the Tax benefit.

Although there are some respondents who invest for

increase in wealth and financial security ad retirement

solution.

Most of the respondents have their investment in the Bank

FD, and post office deposit.

Some of the them also investing in mutual funds and

insurance also.

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

having the services as their occupation.


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SUGGESTIONS

People still doubt the private companies whether they

provide return or not and their money will safe or not.

Company should improve the quality f the adviser so

that they can provide full information to the customers.

People still investing in the bank FD and post. To

capture that market company should come with the

product, which is more safe and having good returncapacity.

Company should also give more focus on professionals

and the businessman who can be the more profitable for

the company.


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CONCLUSION

After survey its known that people want to invest in

the ULIPs than other policy. the reason is that it

gives reasonable return with lore safety than otherplan of Private insurance players.

People should be given more knowledge about thebenefit of the insurance.

As the trust on private player is less the companyshould work on the getting the full trust of all the

people.

Because of insecurity in private companies people

invest in the bank FD and Post office deposit.


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BIBLIOGRAPHY

WEBSITES:

www.irdaindia.com

www.icicibank.com

www.iciciprulife.com

www.prudential.co.uk

BOOKS REFFERED:

Business Research Methodology

Author : Donald Cooper & Pamela Schindler

Publisher : TATA - Mcgraw hill

Year of Publication : 2003

Marketing Management

Author : Philip kotler

Publisher : prentice hall

Year of Publication : 2006
http://www.irdaindia.com/http://www.maxnewyorklife.com/http://www.prudential.co.uk/http://www.irdaindia.com/http://www.maxnewyorklife.com/http://www.prudential.co.uk/

summer project of icici prudential

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