project report
- 1. A PROJECT REPORT ICICI PRUDENTIAL LIFE INSURANCE NEW CHANNEL TIE UP WITH POST OFFICE Submitted To DR.IT INSTITUTE OF MANAGEMENT AND TECHNOLOGY (IMT) In partial fulfillment of the requirement for the degree of BACHULAR OF BUSINESS ADMINISTRATION (BBA) (Session 2010-2011) Submitted to Submitted By MISS. TARUNA DUREJA SANDEEP KUMAR BBA – 5th SEM 1
- 2. TABLE OF CONTENTS COMPANY PROFILE ICICI INTRODUCTION HISTORY ICICI PRUDENTIAL BOARD OF DIRECTORS ICICI PRODUCTS • Profile of the study • Justification of study • Organization Structure POST OFFICE PRODUCTS OBJECTIVES OF STUDY Research Methodology and Analytical Tools • Sampling &Sampling Design • Analytical Tools – Statistical Tools • Data Collection • Hypothesis Testing • Limitations of Study Advantages Recommendations Policy Implications Bibliography Annexure 2
- 3. ACKNOWLEDGEMENT Heartfelt thanks to the following people…. A Few typewritten words of thanks can-not really express the sincerity of my gratitude. But I am still trying to put into words my gratefulness towards all who have helped & encouraged me in carrying out this project. I would like to thanks Miss Taruna Dureja to give me guidelines and my worthy thanks to my teacher (faculty member) for their valuable contribution during the academic session and guidance in preparation of this project report. This report conveys my heartiest thanks to MISS ANJALI SHARMA AFSM of “ICICI PRUDENTIALS LIFE INSURANCE CO. LTD.” for giving me this project & helping me in completion of this project. No praise is ample for the never tiring efforts of my colleagues whose constant support feedback, guidance & practical suggestions helped me in completing this Project successfully. 3
- 4. Company profile of ICICI PRUDENTIAL The company assigned to me is ICICI Prudential Life Insurance Company. It is in to selling life insurance products. ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, a Premier Financial Powerhouse and Prudential PLC, a leading international financial services group headquartered in the United Kingdom. ICICI Prudential was amongst the first private sector insurance companies to begin operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). At present it is growing at a tremendous pace. Now we can say there is no close competitor to ICICI Prudential. ICICI Prudential’s equity base stands at Rs. 9.25 billion with ICICI Bank and Prudential PLC holding 74% and 26% stake respectively. In the financial year ended March 31, 2005, the company garnered Rs. 1,584 crores of new business premium for a total sum assured of Rs. 13,780 crores and wrote nearly 6,15,000 policies. The company has a network of about 56,000 advisors as well as 7-bank assurance and 150 corporate agent tie-ups. For the past five years, ICICI Prudential has retained its position as No. 1 private life insurance in the country, with a wide range of flexible products that meet the needs of Indian customer at every step in life. 4
- 5. PREFACE Beginning of the system project is entirely creative. This does not come all of a sudden, but it comes by result of discussion, consultation and contemplation. Problem unsolved here can never be satisfactory eliminated later. It is therefore a slow process. Moreover practical training is an important part of management courses. The theoretical studies are not sufficient to get into the corporate world. Only practical knowledge can help us to understand the complexities of large scale organizations. To develop healthy managerial and administration skill in potential managers, it is necessary that theoretical knowledge must be supplemented with exposure to the real environment. Actually, it is life for, a management itself is realized. In my case I confronted myself to ICICI prudential Life insurance company Ltd. & the exposure that I could not have gained from the books. I found it very interesting and challenging. I did my training at Una branch office and my topic of project is INCLINATION TOWARDS ULIP security and Investment solution with special reference to ICICI PRUDENTIAL LIFE INSURANCE. 5
- 6. DECLARATION I hereby declare that the project “ICICI PRUDENTIAL LIFE INSURANCE LTD NEW CHANNEL TIE UP WITH POST OFFICE of Life Insurance Corporation of India and ICICI Prudential in UNA)” for ICICI PRUDENTIAL LIFE INSURANCE is original and beneficed work done by me. The project is being submitted in partial fulfillment requirements for the award degree of BBA Under PTU JALANDHER . The contents of this project are based on the field work and analysis done by me during my tenure at ICICI Prudential, UNA 6
- 7. EXECUTIVE SUMMARY The Winter training is a integrated part of BBA course. In this period of 6 weeks we come to know about the problem and how to solve those problems. In this we gained practical knowledge about the organizational work. I did for 6 weeks in an organization ICICI PRUDENTIAL LIFE INSURANCE, and under going practical on the topic “(A comparative analysis with regard to investor’s base & Investment Avenues in case of Insurance Companies-A comparision of post office products and icici products and how to solve financial problems. The practical training had provided me the real scenario of financial analysis. I analysis the financial status of the organization. I came to the conclusion that the financial position of company very strong and people are more interested to invest their earning in ICICI PRUDENTIAL LIFE INSURANCE as compare to other financial institutions. In last three or four year ICICI PRUDENTIAL LIFE INSURANCE constantly ranked no.2 position in Insurance sector. ICICI PRUDENTIAL LIFE INSURANCE satisfied their consumers by fulfilling their needs sets. 7
- 8. IRDA GUIDELINES ON ULIPS The Insurance Regulatory and Development Authority (IRDA) recently introduced its much-awaited guidelines to govern unit-linked insurance policies (ULIPs) The new provisions IRDA has prescribed a minimum sum assured equal to 50 per cent of the total annualized premium during the entire policy term or five times the annualized premium, whichever is higher. This regulation is aimed at maintaining the basic characteristic of a life insurance policy, where life cover should be the primary benefit. Till the policyholder turns 60 years old, the sum assured cannot be reduced by partial withdrawals. This is aimed at protecting the life insurance cover. Time Period: According to new guidelines the time period of investment in ULIPs has been increased to 5 years. Earlier it was for 3 years. Top-up Premiums: Top up premiums are irregular dump-in amounts allowed in a ULIP. Up to now, there were no restrictions; it was possible, for example, to dump in Rs1 crore in a ULIP and invest the entire amount in the market. But this vitiates the basic characteristic of the policy by making the insurance component insignificant. To plug this loophole, IRDA has prescribed that a sum assured must back any dump-in that exceeds 25 per cent of normal premium, which will be constant throughout the term of the policy. Any appropriation towards a dump-in can take place only if the normal premiums are paid Withdrawals from ULIPs: Earlier, withdrawals from ULIPs were possible even within a year of issue. Depending on the option selected, they were reduced from the sum assured, 8
- 9. resulting in dilution of death benefits to the nominees. Now, withdrawals will be allowed only after three years. The new guidelines provide that except for withdrawals made during the two years immediately preceding death, no other withdrawals can be reduced from the sum assured. But once the customer is past the age of 60, all withdrawals can be reduced from the sum assured. Lock-in period: A top-up premium cannot be withdrawn for three years. This places ULIPs on par with mutual fund contributions under Section 80C of the Income Tax Act, 1961. The only relaxation in this condition is on withdrawal of top-up premiums made during the last three years of the policy contract. Settlement options: The policyholder has settlement options, to receive the policy benefits in various forms, rather than a lump sum. For example, the company can give the policyholder an option to receive the maturity benefit in the form of a monthly pension. IRDA has restricted such extended periods of settlement to five years from the date of maturity. The company should also make clear the inherent risk involved in extended periods of settlement. Charges: Charges are costs appropriated by insurance companies from ULIP premiums. The IRDA has listed the charges that insurance companies can levy on policyholders, as well as laid out the standard definitions for use in policy contracts. This is aimed at clarity and to enable customers to understand and compare costs between different insurance companies. Market Conduct: There is an inherent risk in investing in ULIPs, as the performance of the funds underlying the ULIPs governs their returns. To address these risks, the IRDA has authorized the Life Insurance Council to formulate a Code of Conduct for sale of ULIPs. This includes mandatory training for agents before they are authorized to sell ULIPs, documentation to enable the customer to understand and acknowledge the risk involved in buying ULIPs, a code of conduct for their sale, educating policyholders on risk factors, terminology, charges, etc. 9
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- 11. CHAPTER 1 INTRODUCTION 11
- 12. Introduction to study: My study is that I have to Analysis with regard to Investors base and Investment avenues in case of insurance companies-“ICICI PRUDENTIAL NEW CHANNEL TIE UP WITH POST OFFICE Let’s discuss the concept of insurance and a brief introduction about these 2 companies. “Insurance is a contract between two parties whereby one party called insurer undertakes in exchange for a fixed sum called premiums, to pay the other party called insured a fixed amount of money on the happening of a certain event.” It’s hard to think about those you leave behind if something happens to you. Your family counts on you every day for financial support: food, shelter, transportation, education, and much more. You and your spouse have plans or your future and dreams for your family: a bigger home, a new business, college education, travel, retirement etc. Life insurance is all about making sure your family has adequate financial resources to make those plans and dreams come true, if you were to die prematurely It provides financial protection to help your family to manage after your death. Insurance companies collect premiums to provide for this protection. A loss is paid out of the premiums collected from the insuring public and the insurance companies act as trustees to the amount collected Many companies are coming with various plans Ulip plan is one of them which provides huge benefit to the public. It provides insurance as well as investment. 12
- 13. Why Life Insurance? You think twice before taking the plunge into buying insurance. Is buying insurance a necessity now? Spending an 'extra' amount as premium at regular intervals where you do not see immediate benefits does not seem a necessity at the moment. Well you could be wrong. Buying Insurance cannot be compared with any other form of investment. Insurance gives you a life long benefit and the returns will definitely come but only when you need it the most i.e. at the right time. Besides buying insurance early in life is one of the wise decisions you could take. Because the premium you would be paying would be comparatively lower. Insurance is not about how much more it can offer you when the stock market is at its peak. It may not be an attractive investment option. But weigh the pros and cons and consider how much more it offers at a small price. Most important of all it provides you with that unique sense of security that no other form of investment provides. It gives you a sense of financial support especially during that time of crisis irrespective of the fluctuations in the stock market. Insurance provides for your career goals right from your childhood years. 13
- 14. If the earning member of the family is no more your child's educational needs will not suffer. In fact his higher education too will be provided for. You need not spend sleepless nights thinking about how to save for your child's marriage. Life Insurance will take care of that typical once-in-a-life-time spending on marriages. An accident or a disability may be devastating but an insurance policy can be of utmost support for the family during such times too. Besides it provides for additional benefits such as bonuses. You need not worry about your retirement years. The rising prices, taxes, and your lifestyle will be taken care of easily. And you can relax and spend your old age in comfort and peace. Need for Life Insurance The need for life insurance comes from the need to safeguard our family. If you care for your family’s needs you will definitely consider insurance. Today insurance has become even more important due to the disintegration of the prevalent joint family system, a system in which a number of generations co-existed in harmony, a system in which a sense of financial security was always there as there were more earning members. Times have changed and the nuclear family has emerged. Apart from other pitfalls of a nuclear family, a high sense of insecurity is observed in it today besides, the family has shrunk. Needs are increasing with time and fulfillment of these needs is a big question mark. Insurance provides a sense 14
- 15. of security to the income earner as also to the family. Buying insurance frees the individual from unnecessary financial burden that can otherwise make him spend sleepless nights. The individual has a sense of consolation that he has something to fall back on. From the very beginning of your life, to your retirement age insurance can take care of all your needs. Your child needs good education to mould him into a good citizen. After his schooling he needs to go for higher studies, to gain a professional edge over the others - a necessity in this age where cutthroat competition is the rule. His career needs have to be fulfilled. Life insurance today plays a major role in ones life at various stages. Considering the benefits it offers one cannot but give a thought to buying an insurance policy at the earliest. INSURANCE PROVIDES:- Insurance provides varies benefits to the people. some of those are listing below - 1Risk Coverage 2Child Solutions 3Whole-Life Plans 4Health Protection 15
- 16. 5Superior Saving Instrument 6Investment 7Retirement(Pension Plans) 1 Board of Directors The ICICI Prudential Life Insurance Company Limited Board comprises reputed people from the finance industry both from India and abroad. Ms. Chanda D. Kochhar, Chairperson Mr. N. S. Kannan, Director Mr. K. Ramkumar, Director Mr. Barry Stowe, Director Mr. Adrian O’Connor, Director Mr. Keki Dadiseth, Independent Director Prof. Marti G. Subrahmanyam, Independent Director Ms. Rama Bijapurkar, Independent Director Mr. Vinod Kumar Dhall, Independent Direct 16
- 17. PROFILE OF INSURANCE INDUSTRY Insurance is a must because of the uncertain future adversities of life. Accidents, illnesses, disability etc are facts of life that can be extremely devastating. Other than the hospitalization, medication bills these may run up it’s the aftermath of the incident, the physical well being of the individual that has to be taken into consideration. Will the individual be in a position to earn as before? A pertinent question. But what if he is not? Disability can be 17
- 18. taken care of by insurance. Your family will not have to go through the grind due to your present inability. You think twice before taking the plunge into buying insurance. Is buying insurance a necessity now? Spending an 'extra' amount as premium at regular intervals where you do not see immediate benefits does not seem a necessity at the moment. May be later well you could be wrong. Buying Insurance cannot be compared with any other form of investment. Insurance gives you a life long benefit and the returns will definitely come but only when you need it the most i.e. at the right time. Besides buying insurance early in life is one of the wise decisions you could take. Because the premium you would be paying would be comparatively lower. INDIAN INSURANCE INDUSTRY Insurance industry, as on 1.4.2000, comprised mainly two players: the state insurers: Life Insurers: • Life Insurance Corporation of India (LIC) • HDFC Standard Life Insurance Company Ltd. 18
- 19. • Max New York Life Insurance Co. Ltd. • ICICI Prudential Life Insurance Company Ltd. • Kotak Mahindra Old Mutual Life Insurance Limited • Birla Sun Life Insurance Company Ltd. • Tata AIG Life Insurance Company Ltd. • SBI Life Insurance Company Limited • ING Vysya Life Insurance Company Private Limited • Bajaj Allianz Life Insurance Company Limited • Metlife India Insurance Company Pvt. Ltd. General Insurers: • General Insurance Corporation of India (GIC) (with effect from Dec'2000, a National Reinsurer) GIC had four subsidary companies, namely ( with effect from Dec'2000, these subsidaries have been de-linked from the parent company and made as independent insurance companies. 19
- 20. 1. The Oriental Insurance Company Limited 2. The New India Assurance Company Limited, 3. National Insurance Company Limited 4. United India Insurance Company Limited. SAHARA 0.61 0.04 20
- 21. Company Profile of POST OFFICE GENERAL PROFILE OF THE ORGANISATION, FUNCTIONS AND DUTIES The Department of Posts comes under the Ministry of Communications and Information Technology, Government of India, functions under the Minister for Communications and Information Technology, and has a Minister of State for Communications to assist the Minister of Communications and Information Technology in the discharge of various functions. The Secretary, Department of Posts, as the Chief Executive of the Department, is also the Director General, India Post, and the Chairman of the Postal Services Board. 21
- 22. Shri. A. Raja is the Minister of Communications and Information Technology Shri. Gurudas Kamat is the Minister of State for Communications and Information Technology. Shri. Sachin Pilot is the Minister of State for Communications and Information Technology. Ms. Radhika Doraiswamy is the Secretary (Posts) to Govt. Of India as well as Director General, Department of Posts and the Chairman of the Postal Services Board. The Postal Services Board, the apex management body of the Department, comprises the Chairman and six MembeINR The Members of the Board hold portfolios of Operations, Development and Personnel. The Joint Secretary and Financial Advisor to the Department is a permanent invitee to the Board. The Board is assisted by a senior staff officer of the Directorate as Secretary to the Board. Presently, Deputy Director General (FS) is assisting the Board in this capacity. Deputy Directors General, Directors and Assistant Directors General provide necessary support for the Board at HeadquarteINR The Postal Services Directorate is the Headquarters organization located at Dak Bhawan, New Delhi, to oversee the operations in the provision of postal services throughout the country. The Postal Services Board comprises the following at present: Ms. Radhika Doraiswamy Secretary (Posts) Chairman, Postal Board & Director General Ms. Indira Krishna Kumar Member (Personnel), Postal Services Board Ms. Manjula Prasher Member (Operations), Postal Services Board S. Samant Member (Technology), Postal Services Board 22
- 23. Dr. Uday Balakrishnan Member (PLI) & Chairman Investment Board, Postal Services Board Maj. Gen. V Sadasivam Member (HRD) Postal Services Board Sri P K Gopinath Member (Planning), Postal Services Board For providing postal services, the whole country has been divided into 22 Postal Circles. These Circles manage the day-to-day functioning of the various Head Post Offices, Sub - Post Offices and Branch Post Offices, through their Regional and Divisional level arrangements. Objectives Department of Posts is committed to providing universal access to basic postal services in the country at affordable prices. Its objectives are to:- Ensure availability of basic postal services in all parts of the country, including tribal, hilly and remote areas. Provide efficient reliable and economic service. Provide value added services according to market requirements. Modernize the services to handle the growing volume of work with efficiency and thereby enhance customer and employee satisfaction. Be a forward looking organization, and Generate more resources and improve financial performance. As per Government of India (Allocation of Business) Rules, 1961, second Schedule, Rule 3, Distribution of Subjects among the Departments the Department Of Posts is responsible for 23
- 24. 1. Execution of works, including purchase of land debitable to the Capital Budget pertaining to the Department of Posts. 2. Posts, including Post Office Savings Banks (Administration), Post Office Certificate (Administration), Post Office Life Insurance Fund (Administration), printing of public postage stamps/commemorative stamps including postal stationery, premium postal products and any agency function. 3. International cooperation in matters connected with postal communications, including matters relating to all international bodies dealing with postal communications such as Universal Postal Union, Asia Pacific Postal Union (APU), Commonwealth Postal Union. 4. Matters relating to introduction, development and maintenance of all services by the Post Office including those based on cable, radio and satellite communications channels: Provided that these matters do not amount to broadcasting, narrow casting, cable and radio networking services and are also not governed by the Indian Telegraph Act, 1885 and the rules made there under, and not exclusively allotted to any other Department. 5. Promotion of feasibility survey, research and development in the field of activities allotted to the Department. 6. Matters relating to administration of the Indian Post Office Act, 1898 and rules made there under as well as other laws or enactments having a bearing on postal activities, not specifically allotted to any other Department. Network 24
- 25. INDIA HAS THE LARGEST POSTAL NETWORK IN THE WORLD WITH 1,55,669 POST OFFICES OF WHICH 89% ARE IN RURAL AREAS. AT THE TIME OF INDEPENDENCE, THERE WERE 23,344 POST OFFICES, WHICH WERE PRIMARILY IN THE URBAN AREAS. THUS THE NETWORK HAS REGISTERED A SEVEN FOLD GROWTH OVER THE LAST FIVE DECADES, THE FOCUS OF THIS EXPANSION BEING IN THE RURAL AREAS. ON AN AVERAGE, A POST OFFICE SERVES AN AREA OF 21.09 SQ. KM. & POPULATION OF 6,585. THROUGH THESE OFFICES IT ENSURES DAILY DELIVERY OF DAK AT THE DOORSTEP OF EVERY CUSTOMER ALL OVER THE COUNTRY, COLLECTION OF LETTERS THROUGH LETTERBOXES, AND ALSO SALE OF STAMPS AND STATIONERY THROUGH VILLAGE POSTMEN AT THE DOORSTEP OF CUSTOMERS IN RURAL AREAS. POST OFFICES IN URBAN AND RURAL AREAS PROVIDE A RANGE OF BASIC POSTAL SERVICES TO THE CUSTOMERS, INCLUDING BANKING AND INSURANCE SERVICES. BILL COLLECTION FELICITIES ARE BEING EXTENDED THROUGH ALL POST OFFICES IN URBAN AREAS, AND IDENTIFYING POST OFFICES IN RURAL AREAS. CERTAIN VALUE ADDED SERVICES ARE BEING PROVIDED IN SELECTED OFFICES IN URBAN AREAS. Efforts are also being made to identify means of providing postal services through more cost effective measures. The Licensed Stamp Vendor Scheme, Licensed Postal Agents Scheme and the Panchayat Sanchar Sewa Yojana(PSSY) were initiatives that were taken up in this regard. So far 7,697 Panchayat Sanchar Sewa Kendras(PSSKs) have been opened, including 2,371 PSSKs under the 10 th Plan. Since an assessment of these schemes indicates the need for restructuring them, no targets were given in 2004-05 for opening PSSKs. Efforts are also underway to optimize the retailing capacity of the network. One major initiative taken up in the current year is the retailing of non-life insurance products through Post Offices. The Department has entered into an agreement with the Oriental Insurance Company to function as their Corporate Agent for marketing identified non-life products. This Scheme was launched on a pilot basis through select Post Offices in 2 districts each of 7 Circles. It is being gradually expanded, after providing the requisite training to other Circles. 25
- 26. Postal Services Postal operations at the post office encompass the entire gamut of the basic postal services which interalia include: i) Sale of stamps and stationery ii) Booking of registered articles iii) Booking of insured articles iv) Booking of value payable articles Remittance of money through money orders v) and postal orders vi) Booking of Parcels Traditionally, these services were being provided at manually operated counte INR Considering the vital need for providing the benefit of technology to the customers, the counter operations are now being progressively computerised to provide a greater range of service to the customer from a single window leading to services being more responsive, and error free. Mail Operations Mail processing, transmission and delivery are the core activities of the Department. Mail is collected from 0.60 Million letter boxes in the country. This is processed by a network of 466 Railway Mail Service Offices, and conveyed by road, rail and airlines all over the country. Philately The philatelic activities of India Post include:- Designing, printing and distribution of special/commemorative postage i) stamps and other postage stamps/ service postage stamps. Items of postal stationery like Envelope, Inland Letter Card, Postcard, ii) Aerogram and Registered Cover etc. 26
- 27. Monitoring and promotion of Philately/conduct of philatelic exhibitions iii) within the country, participation in international and world exhibitions iv) Management of the National Philatelic Museum, Dak Bhavan. Insurance is a must because of the uncertain future adversities of life. Accidents, illnesses, disability etc are facts of life that can be extremely 27
- 28. devastating. Other than the hospitalization, medication bills these may run up it’s the aftermath of the incident, the physical well being of the individual that has to be taken into consideration. Will the individual be in a position to earn as before? A pertinent question. But what if he is not? Disability can be taken care of by insurance. Your family will not have to go through the grind due to your present inability. You think twice before taking the plunge into buying insurance. Is buying insurance a necessity now? Spending an 'extra' amount as premium at regular intervals where you do not see immediate benefits does not seem a necessity at the moment. May be later well you could be wrong. Buying Insurance cannot be compared with any other form of investment. Insurance gives you a life long benefit and the returns will definitely come but only when you need it the most i.e. at the right time. Besides buying insurance early in life is one of the wise decisions you could take. Because the premium you would be paying would be comparatively lower. 28
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- 32. The company mainly depends on advisors. The advisors are considered as the brand ambassadors of the company or the working partner who doesn’t have to invest to get returns but just work with the company to make money. Advisors main job is to sell policy and in return the advisors get huge return like high commission, rewards, recognition etc. He is, for all purposes, an authorized salesman for insurance. Advisors can become the Unit Manager of the company if they pass the pinnacle program. ICICI Prudential has recruited and trained about 56,000 insurance advisors to interface with and advise customers. Further, it leverages its state-of-the-art IT infrastructure to provide superior quality of service to customers. Manager will get a fixed salary and the commission on the policies sold by his advisor and the commission of the policies which he has already sold. Tiger team manager is one who gets to sell the policy and get commission, train the advisors about the product and he is also a paid up employee of the company. ICICI GROUP 32
- 33. VISION To be the dominant Life, Health and Pensions player built on trust by world-class people and service hope to achieve by: • Understanding the needs of customers and offering them superior products and service • Leveraging technology to service customers quickly, efficiently and conveniently • Developing and implementing superior risk management and investment strategies to offer sustainable and stable returns to our policyholders • Providing an enabling environment to foster growth and learning for our employees • And above all, building transparency in all our dealings 33
- 34. VALUES Very member of the ICICI Prudential team is committed to 5 core values: Integrity, Customer First, Boundary less, Ownership, and Passion. These values shine forth in all we do, and have become the keystones of our success Brief Detail of the Company:/History 34
- 35. ICICI Prudential Life Insurance Company is a joint part of ICICI Bank, a premier financial powerhouse, and Prudential policy, a leading international financial services group headquartered in the United Kingdom. ICICI Prudential was amongst the first private sector insurance companies to begin operations in December 2000 after receiving approval from Insurance Regulatory Development Authority (IRDA). ICICI Prudential's capital stands at Rs. 18.15 billion with ICICI Bank and Prudential plc holding 74% and 26% stake respectively. For the period April-December 2006, the company garnered new business weighted premium of over Rs 2,302 crore and wrote over 1.1 million policies. The company has assets held to the tune of over Rs 13,000 crore. ICICI Prudential is also the only private life insurer in India to receive a National Insurer Financial Strength rating of AAA (Ind) from Fitch ratings. The AAA (Ind) rating is the highest rating, and is a clear assurance of ICICI Prudential's ability to meet its obligations to customers at the time of maturity or claims. For the past six years, ICICI Prudential has retained its position as the No. 1 private life insurer in the country, with a wide range of flexible products that meet the needs of the Indian customer at every step in life. To know more about the company, please visit www.iciciprulife.com. 35
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- 37. 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. Product Offered By POST OFFICE & ICICI PRUDENTIAL PRODUCT OFFERED BY POST OFFICE CHANNEL 37
- 38. 1 .NSC 2 .PPF 3 .SENIOR CITIZEN SCHEMES 4 .PO MIS 5 .TIME DEPOSITS 6 .FIXED DEPOSITS 7 .KISAN VIKAS PATRA 1. NSC,TIME DEPOSITS,FIXED DEPOSITS,KISAN VIKAS PTRA Medium term fixed maturiy schemes 2.Senior citizen schemes,po mis Medium term regular incom schemes 3.PPF long term fixed maturity schemes 1.Kisan vikas patra min/max investment min 100rs 500rs 1000rs 10000rs 50000rs there is no maximum limit 2. Term 8years7months 3. interest rates 8.25%compunded half yearly 4.tax benefits at the time of investment –no rebate available Interim withdrawal taxable Withdrawal on maturity taxable 38
- 39. 2.post office time deposits Min/max investment min200rs and maximum is no limit Term 1,2,3 and 5years Interest rate 1years-6.25% 2years-6.5% 3years-7.25% 5years-7.5% Quartely compounding Tax benefits-at the time of investment- rebate available up to 1lac under sec80c for 5year time deposits Interim withdrawal-taxable Withdrawal on maturity-taxable 3.NSC Min/max investment-100rs 500rs 1000rs 10000rs there is no maximum limit Term-6years Interest rate-8%per annum half yearly compounded(rs.100 becomes 160.10 after maturity period of six years) 39
- 40. Tax benefits-at the time of investment rebate available on investment and accrued interest up to 1 lac under sec 80c Interim withdrawal –N/A Withdrawal on maturity-taxable 5. F.D- min/max investment-min rs1000and no limit maximum Term- min7days max-up to 10 years Interest rate- present rate-10 to10.5% compounding differs from bank to bank Tax benefits-at the time of investment- rebate available up to 1lac under sec 80c for year deposits Interim withdrawal-taxable Withdrawal on maturity-taxable PO MIS- MIN/MAX investment-min1500 max-450000 for single a/c and 900000 for joint a/c TERM-6 year Interest rates-8% per annum payable monthly plus bonus of 5% in case held till maturity TAX benefits-at the time of investment- no rebate available interim payment-taxable SENIOR CITIZEN SCHEMES-MIN/MAX-min1000 max15laks 40
- 41. TERM-5years extended by 3year Interest rates-9%annual fixed rate which is payable quaterly TAX BENEFITS-at the time of investment- rebate available up to 1lac under sec 80c INTERIM PAYABLE-taxable PPF-min/max investment- min-500 max 70000 in a finacial year TERM-15 year INTEREST RATES-present rates-8% compounded per annum rate in the year 2000-12% TAX BENEFITS-rebate available up to 1lac under sec80c INTERIM WITHDRAWAL-tax free Withdrawal on maturity-tax free OBJECTIVE OF THE STUDY To review the whole system of POST OFFICE and ICICI PRUDENTIAL LIFE INSURANCE in terms of origin, growth and rationale. 41
- 42. To study the awareness level of private COMPANY among the GOVT SECTOR POST OFFICE To study and understand the customers requirement and fulfill these requirement To analyze various services provided by ICICI PRUDENTIAL LTD and POST OFFICE I Products Offered By ICICI Prudential 42
- 43. 2 Insurance Plans ICICI Prudential has a wide array of insurance plans that have been designed with the philosophy that different individuals are bound to have differing insurance needs. The ideal insurance plan is one that addresses the exact insurance needs of the individual that will depend on the age and life stage of the individual apart from a host of other factors. Life Insurance Plans: Under Life insurance plans, ICICI Prudential offers plans under the following major need categories: • Education Insurance Plans • Wealth Creation Plans • Premium Guarantee plans • Protection Plans 43
- 44. Pension & Retirement Solutions: The primary objective of a pension plan is to help you provide for your financial needs in your post retirement years. You will find a Pension Planning Calculator on the site, meant to make your pension plan review as simple as possible. The calculator is the first step in your Pension Plan scheme, there are othe steps towards getting the Indian pension policy you need. Click here to know more about our pension plan solutions. • LifeStage Pension • LifeTime Super Pension • LifeLink Super Pension • ForeverLife 44
- 45. Health Product Suite: Under Health Product Suite, ICICI Prudential offers plans under the following major need categories: Hospitalisation Plans • MediAssure • Hospital Care Critical Illnessl Pans • Crisis Cover Cancer Products 45
- 46. • Cancer Care Diabetes Products • Diabetes Care Active • Diabetes Assure 3 Education Insurance Plans One of your most important responsibilities as a parent is to ensure that your child gets the best possible education that can be provided. ICICI Prudential offers a wide portfolio of education insurance plans that are designed to provide peace of mind to you, as a parent, that your child's education will be secure. These plans ensure that money is made available at the crucial junctures in a child's education - Class X, Class XII, graduation and post-graduation - to fund crucial commitments for the child's future. Importantly, education insurance plans ensure that in the unfortunate event of the death of a parent, the child's education continues unhampered. 46
- 47. Under the education insurance plans platform, ICICI Prudential brings the following products to you. Please click on the product name to know more about the plans. Plan Name Plan Type SmartKid New Unit-linked Unit Linked Regular Premium SmartKid New Unit-linked Unit Linked Single Premium SmartKid Regular Premium Traditional 4 Wealth Creation Plans Wealth Creation Plans give the customer the dual benefit of protection along with the potentially higher returns of market-linked instruments. The most important benefit of ULIPs is the flexibility they give the customer in choosing the premium amount and also choosing the underlying fund in which this money is to be invested. Wealth creation plans also offer the customer more liquidity options as compared to traditional plans. As such, ULIPs are ideal for customers who want the protection of a 47
- 48. life cover to be allied to the returns of market linked instrument – giving them an unmatched combination of benefits. Under the wealth creation platform, ICICI Prudential brings the following products to you. Please click on the product name to know more about the plans. Plan Name Plan Type ICICI Pru Secure Save Unit Linked ICICI Pru Wealth Advantage Unit Linked ICICI Pru Life Stage Assure Unit Linked ICICI Pru Life Time Gold Unit Linked ICICI Pru Premier Life Gold Unit Linked ICICI Pru Life Link Super Unit Linked ICICI Pru Life Stage RP Unit Linked 48
- 49. Retirement Solutions ICICI PRUDENTIAL Provide a wide range of retirement plans and they are as follows • Life Stage Pension • Life Time Super Pension • Life Link Super Pension • Fore ver Life • Immediate Annuity Group Plans ICICI Prudential offers a suite of group insurance plans that are as follows: • Group super annuation • Group gratuity period • Annuity solution plan • Group term insurance plan • Group term insurance in lieu of EDL Organization Structure of ICICI 49
- 50. CHIEF MANAGING DIRECTOR (CMD) CHIEF AREA OFFICER CHIEF AREA OFFICER (PENINSULAR) (HIMALAYAN) Sales Head ZONAL MANA GER ZONAL MANA GER ZONAL MANA GER ZONAL MANA GER ZONAL MANA GER ZONAL MANA GER ZONAL MANA GER AREA SALES MANA GER Unit Manager / Area Manager/ Senior Agency Manager 50
- 51. RESEARCH METHODOLOGY 51
- 52. Research Methodology deals with, the procedure adopted to carry out the study. According to green and Tull: “A research design is the specification of methods and procedures acquiring the information needed It is the overall operational pattern or framework of the project that stipulates which information is to be collected from which sources by what procedures’’. For conducting the study, the researcher has adopted both primary as secondary method of data cllection. TYPE OF RESEARCH Research refers to the search for knowledge. It can be defined as scientific and systematic search for pertinent information on a specific topic. It is careful investigation or enquiry especially through search for new facts of any branch of knowledge. Research plays an important role in the project work. The result of the project is completely based upon the research of the facts and figures 52
- 53. collected through the different ways of research. That is why it is also called a movement from known to unknown. Research is the original contribution to the existing stock of knowledge. • Exploratory or Formulative research: Exploratory research is conducted to clarify the ambiguous problems • Descriptive research: To portray the characteristics of an individual, group, situation, etc • Diagnostic research: To determine the frequency of occurrence of an event. Research Design In the data collection method, we have collected both primary and secondary data to meet our objective. Primary data: The primary data was collected by a survey based on the questionnaire. It was formulated on the basis of information gathered 53
- 54. by me with the help of Miss Taruna Arora who provide useful guidelines and objective of our study. Secondary data: The secondary data was collected from books and internet. Data Source: The data that is collected from different sources, as the first hand information that is called primary data. The source of primary data in my research is questionnaire and observation method. The secondary data were also used in my report preparation. This is collected from company record and from internet. Research Approach: The required information in the form of data is collected through survey method, with the help of personal interview through questionnaire method. Sampling plan: 54
- 55. There is a stage where the planning is done about the sample units, sample size, sampling procedures, etc. Sample units: This means, which is to be surveyed. So as mention earlier that the sample units is potential peoples. Sample size: The sample size means how many peoples should be surveyed. So that total sample size is 150, which cover from different area of Una. Sampling Procedures: I choose convenient and judgmental sampling for my research. Data collection method: Personal interview method is used for collection of primary data in the form of questionnaire from respondents. Research Instruments: Once the source of data collection is decided then comes the instrument for data collection or the research instrument. In this survey 55
- 56. method a questionnaire was framed. This is Philip by the potential people though personal interview SWOT ANALYSE Strength • Good Fund Management Team. • Stable and experienced management. • Innovative Products, Technology, Organization culture and climate. • Excellent services. • Less documentation formalities are required. • Morally and ethically strong. • Huge customer database. • Strong networks. Weakness • Investment Products are slight costly. • High operating and commission expenses • Less attractive offers. • Lack of promotional campaigns 56
- 57. • Competitors are in the market offer same product offered by the difference in the premium and offering. • Lack of customer awareness Opportunity . • People are now more health and life conscious. • Some Rural markets are still untouched. • In the pension field where people want good life after their retirement. • It can piggyback on the brand name of the BIRLA. • Highly potential market. Threats • POST OFFICE , public player acting as a big competitor • Others Competitors (ICICI Pru, ) • With around 14 private players, it is very difficult to capture the market share. 57
- 58. Results and Disscussions/Findings No. of Respondents Yes No 100 72 28 Do you invest? No. of respondents 80 70 60 50 40 30 20 10 0 Yes No 58
- 59. If not, why? What is the reason for that? No. of Lack of Full of Lack of Lack of Inadequate Respondents knowledge risk guidance interest funds 28 6 3 3 5 11 Lack of knowledge Full of risk 6, 21% 11, 39% Lack of 3, 11% guidence 5, 18% 3, 11% Lack of interest Inadequate funds 59
- 60. If not investing, are you interested in investing? No. of Respondents Yes No 28 20 8 8, 29% Yes No 20, 71% 60
- 61. What comes do you perceive first while investing? No. of Security High saving Tax Others Respondents returns benefits 72 15 24 17 16 0 30 No of respondents 24 25 20 17 16 15 15 Series1 10 5 0 0 Security High saving Tax others returns benefits 61
- 62. No. of Respondents Yes No 72 53 19 Are you adequately insured? 62
- 63. 19, 26% Yes No 53, 74% Which Plan do you prefer and invest? No. of Term Endowmen Money Pension Mediclaim Child Respondents Plan t Plan Back Plan plan plan Plan 72 12 10 27 10 8 5 63
- 64. No. of Security High saving Tax others Respondents returns benefits 72 15 15 16 21 5 Specify the reasons for investing in a particular plan: 64
- 65. 25 21 20 16 No. of respondents 15 15 15 10 5 5 0 Security High returns saving Tax benefits others Are you satisfied with the investment decision? No. of Respondents Highly Satisfied Modera unsatisfied Highly Satisfied te unsatisfied 65
- 66. 72 6 39 19 6 2 50 39 No of respondents 40 30 19 Series1 20 10 6 6 2 0 Highly Satisfied Moderate unsatisfied Highly Satisfied unsatisfied If not, what are the reasons behind that: No. of Lack Of Full of Lack of Lack of Inadequate More than Respondents knowledge risk guidance interest funds one reason 66
- 67. 8 1 1 1 1 1 3 Term Plan Endowment 5 12 Plan 8 10 Money Back 10 Plan Pension Plan 27 Mediclaim plan Child plan 3.5 3 3 2.5 2 1.5 1 1 1 1 1 1 0.5 0 Inadequate Full of risk one reason guidance Lack of interest knowledge More than Lack of Lack Of funds 67
- 68. What do you think who can better guide you for investment? No. of Respondents Broker/agent Banks Investment others consultant 72 13 17 35 7 68
- 69. Broker/agent 7, 10% 13, 18% Banks 17, 24% Investment 35, 48% consultant others Which Company do you prefer for investing? No. of Respondents ICICI PRU POST Others OFFICE 72 28 36 8 69
- 70. Are you satisfied with the behavior/knowledge of broker/agent of a company preferred by you? No. of Highly Satisfied Moderat unsatisfie Highly Respondents Satisfied e d unsatisfied 72 8 41 15 7 1 70
- 71. 50 41 No of respondents 40 30 Series1 20 15 8 7 10 1 0 Highly Satisfied Moderate unsatisfied Highly Satisfied unsatisfied CONCLUSION Competition will surely cause the market to grow beyond current rates, create a bigger "pie," and offer additional consumer choices through the introduction of new products, services, and price options. Yet, at the same time, public and private sector companies will be working together to ensure healthy growth and development of the sector. Challenges such as developing a common industry 71
- 72. code of conduct, contributing to a common catastrophe reserve fund, and chalking out agreements between insurers to settle claims to the benefit of the consumer will require concerted effort from both sectors. The market is now in an evolving phase where one can expect a lot of actions in coming days. The current impediments for foreign participation – like 26% equity cap on foreign partner, ill defined regulatory role of IRDA (Insurance Regulatory development Authority- the watchdog of the industry) in pension business etc.—are expected to be removed in near future. The early-adopters will then have a clear advantage compared to laggards in gaining the market share and market leadership. The will need to make sure right now that all their infrastructure is in place so that they can reap the benefit of an "unlimited potential." 72
- 73. BIBLIOGRAPHY Books: 1Insurance(meaning and concept)-Published by IRDA 2The Mc-Grew Hill Investors Desk Reference,Mc-Graw Hill Publications, Ellie Williams Clinton, page-301-303 3Life Insurance, Indiana University Press. Belth M. Joseph 4Statistical Methods by S.P. Gupta, 34th edition, published 73
- 74. by Sultan Chand & Sons. 5Research Methodology by C.R. Kothari, Second Edition published by New Age International (P) Ltd. 6Business Research Methodology-Cooper & Sindler,4th Edition 7Brouchers of different products of selected companies 8Handbook of ICICI PrudentiAL 9VISIT IN VARIOUS POST OFFICE DISTT UNA Websites: 1www.economywatch.com 2 www.icicipru.com 3www.licindia.com 74