Iciciprudential Life Insurance

Summer Project Report
On
ICICI Prudential Life Insurance

At junagadh
Prepared by:
Hitesh j.vachhani (MBA-III)
Project Guide:
Prof.Vishva Kasundra
R.K.College of Business Management

(R.K.C.B.M.)
Saubmited to:
Saurashtra University Rajkot
Preface
An Industrial, Business or service organization by taking up a project
study is most important part of our M.B.A course & is must as per the syllabus
prescribed by Saurashtra University. Our MBA course is of administrative and
managerial activity of industrial, Business or service organization. The main
objective of this project study is to help the student to develop ability to
practical technique to solve real life problem related industrial. Business or
Service organization.
According to the rules, I have taken my summer training in ICICI
Prudential Life Insurance. Our gardeners, professors and banks sum
managers gives the knowledge and guidance of this bank to us.
The summer training programmed for student of M.B.A Sam-III training
is for two months in the time of summer vacation theoretically knowledge and
class room discussion is not sufficient for the student but training given them
practical and day to day working of bank.
In this project report I had tried to analyze the needs of the customers
and suggest them the most suitable insurance solution. As well as I also
analyzed the brand awareness among the people.
ACKNOWLEDGEMENT
To take training is a part of our MBA programming and is an important
part. Training quit valuable and important aspect to provide practical
knowledge student of management studies.
It was very useful and experience which I got during my training in
ICICI Prudential Life Insurance.
I was able to prepare this training report with the co-operation of various
people.
First of all I am very much thankful to in charge Director and professor
of our institute
our professor Miss Vishva Kasundra who has given me an opportunity and
she has helped me very much in preparing the report by her guidance
Thanking you
(Hitesh J. vachhani)
(MBA-III)
DECLARATION
I undersigned Mr. hitesh j.vachhani The student of MBA Sam III here by
declare that the project work in my own work and has been carried out under
the guidance of Mrs Vishva Kasundra madam of R.K. College of Business
Management of Studies in Rajkot. This Report has been submitted to Saurashtra
University for Evaluation.
Date:
Place: Rajkot
Hitesh J. vachhani
Objective of the Study

Management as a profession cant be taught merely in the four walls of
classrooms. Only theoretical knowledge is not sufficient to build competitive
managers. Practical knowledge of the business environment is equally
important.
In today business world, insurance sector is running towards its
booming stage. This industry still has many things to come up to, so many
changes and opportunities will be given by insurance industry. So I choose
insurance industry for my training session in M.B.A.
I choose ICICI Prudential Life Insurance is one of those private
insurance players who entered the market before few years and made its own
place among all its competitors.
This report is shows insurance sector & how insurance is most
important part of life. And understand insurance definitions, different providers
of life insurance and comparisons. It also shows ICICI Prudential Life
Insurances Products.
As a Trainee ICICI Prudential Life Insurance give me very practical
knowledge about life insurance and how to working in organization, How
manage work, how to maintain relations with top level management as well as
colleges and bottom level management. So, this experience will helpful in
future. I am pleased by taken training at Indias one of the best insurance
company.
T ABLE OF C ONTENT
No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
Particulars
Executive Summary
Nature of Insurance & Definition
Characteristics of Insurance
Introduction of Insurance Company
Life Insurance Company at a glance
Retail Market Share: Private Players
Introduction of ICICI Prudential
Prudential Plc
ICICI Life Insurance
Management
ICICI Prus Products
Finance Department
Marketing Department
Operation Department
Human Resource Department
Research Methodology
Questionnaire
Conclusion
SWOT Analysis
Bibliography
Page No.
7
9
13
17
22
27
31
34
35
36
39
44
58
62
65
78
89
93
95
97
The economy is highly influenced by the Financial System of the country. The Indian
Financial System has been broadly divided into two segments: the organized and the
unorganized. An investor has a wide array of investment avenues available. Economic well
being in the long run depends significantly on how wisely he invests.
0
For todays complex financial scenario a Mutual Fund is the ideal investment option. Markets
for other investment avenues have become information driven. The Mutual Fund Industry in
India began with the setting up of the Unit Trust of India (UTI) in 1964 by the Government of
India. Ever since then this industry has witnessed numerous changes and growth. In 1987
public sector banks and insurance companies were permitted to set up mutual funds.
Securities Exchange Board of India (SEBI) formulated the Mutual Fund (Regulation) 1993,
which for the first time established a comprehensive regulatory framework for the mutual
fund industry. Since the private and joint sectors and the share of the private players have set
up then several mutual funds has risen rapidly.
When investors are confronted with an astounding range of products, from traditional bank
deposits to downright shady money-multiplier schemes, it has to be judged on the yardsticks
of return, liquidity, safety, convenience and tax efficiency.
Insurance is defined as a co-operative device to spread the

loss caused by a particular risk over a number of persons who are
exposed to it and who agree to ensure themselves against that risk.
Risk is uncertainty of a financial loss. It should not be confused
with the chance of loss, which is the probable number of losses out
of confused with peril, which is defined as the cause of loss or
with hazard, which is a condition, may increase the chance of loss.
Every risk involves the loss of one or other kind. The

function of insurance is to spread the loss over a large number of
persons who are agreed to co-operate each other at the time of loss.
The risk cannot be over rated but loss occurring due to a certain
risk can be distributed amongst the agreed persons. They are
agreed to share the loss because the chance of loss is there.
Everybodys greatest asset during his/her working years is
his/her ability to earn an income. It is important to adequately
safeguard this asset to ensure his/her cash flow will continue in the
event of an unexpected disaster. His/her insurance policies will
help to protect him/her (if any) against any unforeseen odds.
There are two kinds of insurance available viz. Life Insurance and
General Insurance.
Life Insurance
Provides for dependents in case of death.

Replaces earning power, if disabled.
Protects his/her ability to meet accumulation / education /
marriage goals.
General Insurance
Addresses health care concerns.

Provides for auto, home and personal liability protection.
Provides for potential long-term care costs.
Plans for business continuation.
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GENERAL DEFINITION
The general definitions are given by the social scientists & they
consider insurance as a device to protection against risks, or a
provision against inevitable contingencies or a co-operative device
of spreading risks. Some of such definitions are given below:
In the words of John Magee , Insurance is a plan by which

large number of people associate themselves & transfer to
the shoulder of all, risks that attach to individuals.
In the words of Sir William Bevridges , The collective

bearing of risks is insurance.
In the words of Boone & Kurtz , Insurance is a substitution

for a small known loss (the insurance premium) for a large
unknown loss, which may or may not occur.
In the words of Thomas , Insurance is a provision, which a

prudent man makes against for the loss or inevitable
contingencies, loss or misfortune.
In the words of Allen Z. Mayerson , Insurance is a device

for the transfer to an insurer of certain risks of economic
loss that would otherwise come by the insured.
In the words of Ghosh & Agarwal , Insurance is a cooperative form of distributing a certain risk over a group of
persons who are exposed to it.
FUNDAMENTAL STATEMENT
These are based on economic or business oriented since it is a
device providing financial compensation against risk or
misfortune.
In the words of D. S. Harsell , Insurance may be defined as

a social device providing financial compensation for the
effects of misfortune, the payments being made from the
accumulated contribution of all parties participating in the
scheme.
11
In the words of Robert I. Mehr & Emerson Cammark ,

Insurance is purchased to offset the risk resulting from
hazards, which exposes a person to loss.
In the words of Riegel & Miller , Insurance is a social

device whereby the uncertain risks of individuals may be
combined in a group & thus made more certain small
periodic contributions, by the individuals providing a fund,
out of which, those who suffer losses may be reimbursed.
Insurance follows important characteristics.
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13
Sharing of Risks
Insurance is a co-operative device to share the burden of risk,
which may fall on happening of some unforeseen events, such as
the death of head of the family, or on happening of marine perils or
loss of by fire.
Co-operative Device
Insurance is a co-operative form of distributing a certain risk over
a group of persons who are exposed to it (Ghosh & Agarwal). A
large number of persons share the losses arising from a particular
risk.
Evaluation of Risk
For the purpose of ascertaining the insurance premium, the volume
of risk is evaluated, which forms the basis of insurance contract.
Payment of happening of specified event
On happening of specified event, the insurance company is bound
to make payment to the insured. Happening of the specified event
is certain in life insurance, but in the case of fire, marine or
accidental insurance, it is not necessary. In such cases, the insurer
is not liable for payment of indemnity.
Amount of payment
The amount of payment in indemnity insurance depends on the
nature of losses occurred, subject to a maximum of the sum
insured. In life insurance, however, a fixed amount is paid on the
happening of some uncertain event or on the maturity of the policy.
Large number of insured persons
The success of insurance business depends on the large number of
persons insured against similar risk. This will enable the insurer
to spread the losses of risk among large number of persons, thus
keeping the premium rate at the minimum.
Insurance is not a gambling
Insurance is not a gambling. Gambling is illegal, which gives gain
to one party & loss to the other. Insurance is a valid contract to
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indemnity against losses. Moreover, insurable interest is present in

insurance contracts & it has the element of investment also.
Insurance is not charity
Charity pays without consideration but in the case of insurance,
premium is paid by the insured to the insurer in consideration of
future payment.
Protection against risks
Insurance provides protection against risks involved in life,
materials & property. It is a device to avoid or reduce risks.
Spreading of risk
Insurance is a plan, which spread the risks & losses of few people
among a large number of people. John Magee writes, Insurance
is a plan by which large number of people associates themselves &
transfer to the shoulders of all, risks attached to individuals.
Transfer of risk
Insurance is a plan in which the insured transfers his risk on the
insurer. This may be the reason that Mayerson observes, that
insurance is a device to transfer some economic losses to the
insurer, and otherwise such losses would have been borne by the
insured themselves.
Ascertaining of losses
By taking a life insurance policy, one can ascertain his future
losses in terms of money.
This is done by the insurer to
determining the rate of premium, which is calculated on the basis
of maximum risks.
A contract
Insurance is a legal contract between the insurer & insured under
which the insurer promises to compensate the insured financially
within the scope of insurance policy, & the insured promises to pay
a fixed rate of premium to the insurer.
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Based upon certain principle

Insurance is a contract based upon certain fundamental principles
of insurance, which includes utmost good faith, insurable interest,
contribution, indemnity, causa proxima, subrogation, etc., which
are the basis for successful operation of insurance plan.
Utmost Good Faith
Insurance is a contract based on good faith between the parties.
Therefore, both the parties are bound to disclose the important
facts affecting to the contract before each other. Utmost good faith
is one of the important principles of insurance.
To conclude, insurance is a device for the transfer of risks from the
insured to the insurers, who agree to it for a consideration (known
as premium), & promises that the specified extent of loss suffered
by the insured shall be compensated. It is a legal contract of a
technical nature.
To conclude, insurance is a device for the transfer of risks from the
insured to the insurers, who agree to it for a consideration (known
as premium), & promises that the specified extent of loss suffered
by the insured shall be compensated. It is a legal contract of a
technical nature.
16
In order to go through the journey of LIC Path of private

sector insurance companies to nationalize company to again private
sector insurance companies is given as below:
Path
Private Life Insurance Companies
17
Nationalization
Privatization of Life Insurance Sector

1870
1956
1956
1995
June
2000
August
2000
October
2000
2002
Life Insurance concept was accepted

with almost 250 Private Life
Insurance Companies
Merging of almost 250 Private
Sector Life Insurance Companies in
one nationalized
Life Insurance Corporation of India
Proposal to privatize life insurance
business
Registration process was notified
Application was filed
1 s t license was issued with
introduction of IRDA
During the month of January, 11
Life and Non-Life Private Insurance
license were issued
In order to elaborate the above path lets go through the history of

Life Insurance Sector.
On 3 r d December 1670, seven earnest men of Bombay with just
seven rupees for initial expenses gave shape to a plan of offering
insurance to the public without the risk of ruin and the Bombay
Mutual Life Insurance Society came into existence.
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Right up to the end of the 19 t h century, foreign insurance

companies had an upper hand in the matter of insurance business
and they enjoyed mere monopoly and the partiality were observed
in the form that Indian lives were insured with 10% extra premium
as a common practice, at that time Lala Harikishan Lal from
Lahore was called The Napoleon of Indian Finance as he was
then called to launch the Bharat Insurance Company at Lahore
(1896) in Punjab.
Prior to 1912, India had no legislation for regulating insurance.
The Life Insurance Companies Act 1912 and the Provident Fund
Act 1912 were passed.
The Insurance Act 1938 was the first comprehensive legislation
governing not only life but also non-life branches of insurance to
provide strict state control over insurance business.
But after the introduction of Insurance Act 1938, the demand for
nationalization of Life Insurance Industry was raised, there were so
many reasons in order to nationalize the insurance sector.
They are:
Policyholders will be provided cent percent security.

Expenses will be reduced due to Absence of duplication,
wasteful competition
Better service due to absence of profit motive.
The funds will be available for nation building activities.
Insurance is servicing sector and so that it should be in the
hands of government only.
Above are few but strong reasons, which have contributed towards
nationalization of insurance sector, and then after in the year 1956,
all insurance companies were merged in to one and Life Insurance
Corporation of India came into existence.
Till the year 1999, LIC of India was the only insurance sector in
economic market with ever-increasing growth rate and market
share with the capacity to earn high rate of profit and thus
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profitability. In spite of all these merits of LIC, the overall status

of insurance sector was not so satisfactory.
Business figure before the introduction of IRDA
Population
Insurable Population
No. Of insured individuals
Potential uninsured
individuals
New Business premium
1.00
0.36
0.08
0.28
Billion
Billion
Billion
Billion
0.66 Billion
Above stated figures clearly shows that from 1 Billion population

of India, almost 0.28 Billion population was uninsured. Again the
existing government unit did not properly meet the emerging
segments like retirement, disability. Moreover, the government
wanted 25% p.a. growth rate in new business premium from
insurance sector. All these factors combine forced the government
to take the decision about the privatization of insurance sector.
In order to increase the business activities, the introduction of
IRDA was made by Government.
Thus, IRDA (Insurance
Regulatory and Development Authority) witnessed the existence
power to co-ordinate regular and control the insurance business.
Private Insurers in Indian Insurance Market

Registration
Date of
Name of the Company
No.
Registration
101
23.10.2000
HDFC Standard Life
104
15.11.2000
Max New York Life
105
24.11.2000
ICICI Prudential Life
107
10.01.2001
Om Kotak Mahindra Life
109
31.01.2001
Birla Sun Life Insurance
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110
111
12.02.2001
30.03.2001
TATA AIG Life Insurance

SBI Life Insurance
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22
LIFE INSURANCE CORPORATION OF INDIA

On January 19, 1956 the President of the Indian Union issued an
ordinance, providing for the taking over, in public interest, of the
management of life insurance pending nationalization of such
business, & the then Finance Minister explained the objectives of
nationalization of life insurance business.
In June 1956, the parliament passed a bill for nationalization of
life insurance business in India and for setting up a corporation as
the sole agency for carrying on this business in India. The
corporation, set up under this Act, is known as Life Insurance
Corporation of India, which started functioning on September 1,
1956 .
For the purpose of servicing of policies issued before September 1,
1956, some integrated head offices & integrated branch office units
were created. These offices have nothing to do with the policies
issued by the corporation. Corporation also took over foreign life
business of the Indian insurers.
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Objectives of LIC
Maximize mobilization of peoples savings by making
insurance linked savings adequately attractive. Conduct
business with utmost economy & with the full realization that
the moneys belong to the policyholders.
To publicize & extent the insurance business specifically in

rural & remote areas.
To provide suitable financial security at reasonable cost.
To make the investments more dynamic by popularizing the

savings plans attached with insurance.
To invest the insurance fund keeping with maximum benefit

& interest of insureds.
To run the insurance business at minimum administrative

costs.
To function as trusts of the insureds.
To fulfill the needs of the society in a changing social and

economic environment.
To make the employees collectively responsible for providing

efficient services to the insureds.
To develop work satisfaction among agents & employees.

HDFC STANDARD LIFE INSURANCE COMPANY
HDFC Standard Life Insurance Co. Ltd. is a joint venture
between HDFC, Indias largest housing finance institution and
Standard Life Assurance Company, Europes largest mutual life
company.
HDFC manages Rs. 21,450 Crores in assets and
Standard Life manages over US $100 billion in assets. Both the
promoters are well known for their ethical dealings, their financial
strength and their commitment to be a long-term player in the life
insurance industry.
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MAX NEW YORK LIFE INSURANCE COMPANY

Max New York Life Insurance Company is a joint venture
between New York Life International Inc. and Max India Limited.
New York Life, a Fortune 100 Company, is one of the worlds
experts in life insurance with over 156 years of experience in the
business and over US$ 165 billion (Rs. 775,000 Crores) in assets
under management.
Max India Limited is a multi-business
corporate, focused on the knowledge, people, and service-oriented
business of life insurance, healthcare and information technology.
ICICI PRUDENTIAL LIFE INSURANCE COMPANY

ICICI Prudential Life Insurance Company is a joint venture
between ICICI Bank, a premier financial powerhouse and
Prudential plc, a leading international financial services group
headquartered in the United Kingdom. ICICI Prudential was
amongst the first private sector insurance companies to begin
operations in December 2000 after receiving approval from
Insurance Regulatory Development Authority (IRDA).
OM KOTAK MAHINDRA LIFE INSURANCE

Om Kotak Mahindra Life Insurance, a company under Kotak
Mahindra Group is a 74:26 life insurance joint venture between
Kotak Mahindra Finance Limited with Old Mutual, U.K.
The philosophy of Om Kotak Mahindra is helping their customers
take financial decisions at every stage in life. Their aim is to
consistently offer a wide range of innovative life insurance
products, to help their customers remain financially independent,
which is why they believe that freedom to take life on "Jeene Ki
Aazadi"
The alliance of Om Kotak Mahindra with Old Mutual has given it
unmatched expertise in life insurance area. With 156 years of
experience in life insurance business, Old Mutual is today an
International Financial Service Group based in London.
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BIRLA SUN LIFE INSURANCE COMPANY

It is a joint venture of Aditya Birla Group and Sun Life Financial
Services with the objective that Insurance is not about something
going wrong. It's often about things going right. One of the
wonders of human nature is that we never believe anything can
actually go wrong. Surely, life has its share of ifs. At Birla Sun
Life however, we believe it has its equally pleasant share of buts as
well. We at Birla Sun Life stand committed to helping you realize
those happy moments, which make a life. Be it living the same
lifestyle in your post retirement days or providing a secure future
for your loved ones, in case something happens to you.
TATA AIG LIFE INSURANCE COMPANY

Tata AIG is a joint venture that is backed by the Tata Group
Indias most respected industrial conglomerate, with revenues of
more than US $8.4 billion, and American International Group, Inc.
(AIG) the leading US-based international insurance and financial
services organization, with a presence in over 130 countries and
jurisdictions throughout the world. Tata AIG offers a gamut of
innovative products in the Life Insurance sector.
SBI LIFE INSURANCE COMPANY

SBI Life Insurance Company Ltd. is a joint venture between
State Bank of India and Cardiff of France. SBI is the largest bank
in India and Cardiff is a leading insurance company in France
operating in 29 countries. Cardiff is a wholly owned subsidiary of
BNP Paribas, the largest European Bank.
26
27
As per the figure available with IRDA reports for the period ended in
August 2005, the 13 private players have grabbed nearly 26% market share
from LIC in terms of premium underwritten as against 17.70% in August
2004 The list of insurer with premium underwritten, investment and their
market share have been presented in table.
Table shows that the life insurance market has collected Rs. 16,604cr as
a fresh premium. It grew about 2.8 times bigger than he 3 players put together
in terms of premium collection. It is still growing at the rate 26% per annum. It
is relevant to that the market share by them. Out of 13 pvt. Players, ICICI
prudential has leading pvt. Player in the Life insurance, invested rs. 625 cr
which is the highest investments among the private players and captured first
position with 7.11% of the market share. Secondly, Max New York life has
invested Rs. 305 cr and had failed to capture the second position in terms of
market share and was satisfied with only 1.32% Followed by HDFC standard
Life had invested Rs. 255 cr and 2.96% of the market share was captured and
stood third position interims of investments and capturing market share.
Allianz Bajaj has invested Rs. 250 cr and stands fourth in terms of investment
but captured second position with 6.12% of the market share. This indicates
that there is no relation between investment and acquiring market share and
mere capital is not alone playing any significant role in terms of capturing
market share. There may be some other variables like: (a) innovative schemes,
(b) brand loyalty, (c) professional outlook, (d) transference in their
transactions, etc. It can be noticed that the capital is not playing any attaching,
kindly significant role in terms of premium collection and capturing market
share. It seems to be Bajaj Allianz would occupy the first position in near
future in terms of market share as well as annual growth rate.
Chart 1 shows that. Among private players, the ICICI prudential has
captured the 28% of the market share up to December 2005, followed by
Allianz Bajaj with 23% and HDFC Standard Life with 11% TATA Aig life and
Birla Sunlife with 7% each and remaining other players have captured less than
5% of market share.
28
Chart 2 shows that the annual growth rate of the private life insurance
players from November 2004-05. it is interesting to note that Allianz Bajaj has
achived 264.09% annual growth rate in terms of premium collection and the
fastest growing insurance players, followed by HDFC Standard with 143.1%
and Metlife with 136.45%, and remaining other players have doubled their
premium in a span of one year, whereas Birla Sunlife and SBI life have failed
to collect the premium consistently and registered negative growth rates 7.93%
and 2.48% respectively. Surprisingly, ICICI Prudential Co. has not been
retrained in their leading position in 2005.
The market share of the LIC has been declining since 2000, after
opening up of the sector to private companies, LICs higher market share in the
number of policies sold compared with premium income, so it is to be inferred
that the private players are cornering a larger share of high premium policies.
Further all policymakers are expected that, insurance business will take wings
under bancassurance but despite the belief SBI Life was registered negative
2.48% annual growth rate in corresponding period. It is need to be viewed
serious by the RBI and IRDA authorities.
29
30
31
ICICI Bank is Indias second-largest bank with total assets of about

Rs.112.024 crore and a network of about 450 branches and offices and about
1750 ATMs. ICICI Bank offers a wide range of banking products and financial
services to corporate and retail customer through a variety of delivery channels
and through its specialized subsidiaries and affiliates in the areas of investment
banking, life and non-life insurance, venture capital, asset management and
information technology. ICICI Banks equity shares are listed in India on stock
exchanges at
Chennai. Delhi, Kolkata and Vadodara, the Stock Exchange, Mumbai
and the National Stock Exchange of India Limited and its American Depositary
Receipts (ADRs) are listed on the New York Stock Exchange (NYSE).
ICICI Bank was originally promoted in 1994 by ICICI Limited, an
Indian financial institution, and was its wholly owned subsidiary. ICICIs
shareholding in ICICI Bank was reduced to 46% through a public offering of
shares in India in fiscal 1998, an equity offering in the form of ADRs listed on
the NYSE in fiscal 2000, ICICI Banks acquisition of Bank of Mathura Limited
in an all-stock amalgamation in fiscal 2001, and secondary market sales by
ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI was formed
in 1955 at the initiative of the World Bank, the Government of India and
representatives of Indian industry. The principal objective was to create a
development financial institution for providing medium term and long term
project financing to Indian businesses. In the 1990s, ICICI transformed its
business from a development financial institution offering only project finance
to a diversified financial services group offering a wide variety of products and
services, both directly and through a number of subsidiaries and affiliates like
ICICI Bank, In 1999, ICICI become the first Indian company and the first bank
or financial institution from non-Japan Asia to be listed on the NYSE.
After consideration of various corporate structuring alternatives in the
context of the emerging competitive scenario in the Indian banking industry,
and the move towards universal banking, the management of ICICI and ICICI
Bank formed the view that the merger of ICICI with ICICI Bank would be the
optimal strategic alternative for both entities, and would create the optimal legal
structure for the ICICI groups universal banking strategy. The merger would
enhance value for ICICI shareholders through the merged entitys access to
low-cost deposits, greater opportunities for earning fee-based income and the
ability to participate in the payment system and provide transaction-banking
services. The merger would enhance value for ICICI Bank shareholders through
32
a large capital base and scale of operations, seamless access to ICICIs strong
corporate relationships built up over five decades, entry into new business
segments, higher market share in various business segments, Particularly feebased services, and access to the vast talent pool of ICICI Bank approved the
merger of ICICI and two of its wholly-owned retail finance subsidiaries, ICICI
Personal Financial Services Limited and ICICI Capital Services Limited, With
ICICI Bank.
Shareholders of ICICI and ICICI BANK approved the merger in January
2002, by the High Court of Gujarat at Ahmedabad in March 2002, and by the
High Court of
Judicature at Mumbai and the Reserve Bank of India in April 2002.
Consequent to the merger, the ICICI groups financing and banking operations,
both wholesale and retail, have been integrated in a single entity. ICICI Bank is
the only Indian company to be rated above the country rating by the
international rating agency moody s and the only Indian company to be
awarded an investment grade international credit rating. The Bank enjoys the
highest AAA (or equivalent) rating from all Leading Indian rating agencies.
Prudential P.L.C.
Established in 1848, today prudential plc is a leading international
financial services company with some 16 million customers, policyholders and
unit holders and some 20,000 employees worldwide. In the UK Prudential is a
leading life and pensions provider with around seven million customers. M&G
was acquired by Prudential in 1999 and is the Groups UK and European fund
manager, responsible for managing over of 111 billion of funds (as at December
2003). Launched by Prudential in 1998, Egg is an innovative financial services
company, with over three million customers, with nearly six per cent of UK
credit card balances. In Asia, Prudential is the leading European life insurer
with 23 life and fund management operations in 12 countries serving some five
million customers. In the US, Prudential owns Jackson National Life, a leading
life insurance company, and has more than 1.5 millions policies and contracts in
force.
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 UKs
33
Largest life insurance company with a vast network of 22 life and mutual
fund operations in twelve countries China, Hong Kong, India, Indonesia,
Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand and
Vietnam. Since 1923, Prudential has championed customer-centric products and
services, supported by over 60,000 staff and agents across the region.
Prudential plcs strong mix of business around the world positions us
well to benefit form the growth in customer demand for asset accumulation and
income in retirement. Our international reach and diversity of earnings by
geographic region and product will continue to give us significant advantage.
Our commitment to the shareholders who own Prudential is to maximize
the value over time of their investment. We do this by investing for the long
term to develop and bring out the best in our people and our businesses to
produce superior products and services, our international peer group in terms of
total shareholder returns.
At Prudential our aim is lasting relationships with our customers and
policyholders, through products and services that offer value for money and
security. We also seek to enhance our Companys reputation, built over 150
years, for integrity and for acting responsibly within society.
ICICI Prudential Life Insurance:

ICICI Prudential Life Insurance Company is a joint venture between
ICICI Bank, a premier financial powerhouse and Prudential Plc, a leading
international financial services group headquartered in the United Kingdom.
ICICI Prudential was amongst the first private sector insurance companies to
begin operations in December 2000 after receiving approval from insurance
Regulatory Development Authority (IRDA).
ICICI Prudential s equity base stands at Rs.6.75 billion with ICICI Bank
and Prudential plc holding 74% and 26% stake respectively. In the year ended
March 31,2004 the company had issued over 430,000 policies, for a total sum
assured of over Rs 8,000 crore and premium income in excess of Rs.980 crore.
The company has a network of about 30,000 advisors; as well as 12 banc
assurance tie-ups. Today the company is the number one private life insurer in
the country.
34
Management
K. V. Kamath
Managing Director and Chief Executive Officer
Lalita Gupte
Joint Managing Director
Kalpana Morparia
Joint Managing Director

Chanda Kochhar
Deputy Managing Director
Nachiket Mor
Deputy Managing Director
35
Board Committees
Audit Committee
Mr. Sridar Iyengar
Mr. Narendra
Murkumbi
Mr. M. K. Sharma
Board Governance &

Remuneration Committee
Mr. N. Vaghul
Mr. Anupam Puri
Mr. M. K. Sharma
Mr. P. M. Sinha
Prof. Marti G. Subrahmanyam
Customer Service
Committee
Credit Committee
N. Vaghul
Narendra Murkumbi
M.K. Sharma
P.M. Sinha
K. V. Kamath
Mr. N. Vaghul
Mr. Narendra Murkumbi
Mr. M .K. Sharma
Mr. P. M. Sinha
Mr. K. V. Kamath
36
Fraud Monitoring
Committee
Mr. M. K. Sharma
Mr. Narendra
Murkumbi
Mr. K. V. Kamath
Ms. Kalpana
Morparia
Ms. Chanda D.
Kochhar
Share Transfer &
Shareholders'/
Investors'
Grievance
Committee
Mr. M. K. Sharma
Mr. Narendra
Murkumbi
Ms. Kalpana
Morparia
Ms. Chanda D.
Kochhar
Risk Committee
Mr. N. Vaghul
Mr. Sridar Iyengar
Prof. Marti G. Subrahmanyam
Mr. V. Prem Watsa
Mr. K. V. Kamath
Asset-Liability Management
Committee
Ms. Lalita D. Gupte

Ms. Kalpana Morparia
Ms. Chanda D. Kochhar
Dr. Nachiket Mor
Committee of
Directors
Mr. K. V. Kamath
Ms. Lalita D. Gupte
Ms. Kalpana
Morparia
Ms. Chanda D.
Kochhar
Dr. Nachiket Mor
37
38
Insurance solution for individuals..

ICICI Prudential Life Insurance offers a range of innovative, customercentric products that meet the needs of customers at every life stage. Its 17
products cab is enhanced with up to 6 riders, to create a customized solution for
each policyholder.
Savings Solutions..
Secure Plus is a transparent and feature-packed savings plan that offers 3
levels of protection. Cash Plus 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. Cash Back is an anticipated endowment policy ideal for
meeting milestone expenses like a childs marriage, expenses for a childs
higher education or purchase of an asset.
39
Protection Solutions.
LifeGuard is a protection plan, which offers life cover at very low cost. It
is available in 3 coupons level term assurance, level term assurance with
return or premium and single premium.
Child Solutions.
Smart kid child plans provide guaranteed educational benefits to a child
along with life insurance cover for the parent who purchases the policy. The
policy is designed to provide money at important milestones in the childs life.
SmartKid child planed are also available with in unit-linked form both single
premium and regular premium.
Market-linked Solutions
LifeLink is a single premium Market Linked Insurance Plan, which
combines life insurance cover with the opportunity to stay, invested in the stock
market. Life Time offers customers the flexibility and control to customize the
policy to meet the changing needs at different life stages. It offers 3 investment
options Growth Plan, Income plan and Balance plan.
Retirement Solutions
40
Forever Life is a retirement products targeted at individual in there

thirties. Secure Plus Pension is a flexible pension plan that allows one to select
between 3 levels of cover.
Market-linked retirement products

Life Time Pension is a regular premium market-linked pension plan. Life
Link Pension is a single premium market linked pension plan. ICICI Prudential
also launched Salaam Zindagi, a social sector group insurance policy targeted
at the economically underprivileged sections of the society.
Group Insurance Solutions

ICICI Prudential also offers Group Insurance Solutions for companies
seeking to enhance benefits to their employees.
Group Gratuity Plan

ICICI Prus group gratuity plan helps employers fund their statutory
gratuity obligation in a scientific manner. The plan can also customize to
structure schemes that can provide benefits beyond the statutory obligations.
Group Superannuation Plan

ICICI Bank offers flexible defined contribution superannuation scheme
to provide a retirement kitty for each member of the group. Employees have the
option of choosing from various annuity options or opting for partial
commutation of the annuity at the time of retirement.
Group Term Plan
41
Group Term Plan
ICICI Prus flexible group term solution helps provides affordable cover
to members of group. The cover could be uniform or based on designation/rank
or 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 marginal cost, depending on the specific 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 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.
Accident benefit: This rider option pays the sum assured the rider on death due
to accidents.
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
prior to death.
Major Surgical Assistance Benefits: provides financial support in the event of
medical emergencies, ensuring that benefits are payable to the life assured for
medical expenses Incurred for surgical procedures. Cove is offered against 43
different surgical procedures.
42
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 SmartKid, SecurePlus and Cashplus.
Waiver of Premium: In Case of total and permanent due to an accident, the
premiums are waived till maturity. This rider is available with SecurePlus and
CashPlus.
43
INTRODUCTION TO FINANCE MANAGEMENT

Financial management, as an academic discipline, has undergone
fundamental changes in its scope and coverage. In the early years of its
evolution it was treated synonymously with the raising of funds. In the current
literature pertaining to financial
44
Management, a broader scope so as to include, in addition to

procurement of funds, efficient use of resources is universally recognized.
Similarly, the academic thinking as regards the objective of financial
management is also characterized by a change over the years.
Financial management, as an integral part of overall management, is not
a totally independent area. It draws heavily on related disciplines and fields of
study, such as economics, accounting, marketing, production and quantitative
methods. Although these disciplines are interrelated, there are key differences
among them. The relationship between finance and accounting, conceptually
speaking, has two dimensions:
(1)
They are closely related to the extent that accounting is an important
input in financial decision-making and
(2)
There are key differences in viewpoints between them.
The viewpoint of accounting relating to the funds of the firm is different from
that of finance. The measurement of funds (income and expenses) in accounting
is based on the accrual principle/system.
Capitalization and Capital Structure:

Capital structure can affect the value of a company by affecting either its
expected earnings or the cost of capital, or both. While it is true that financingmix cannot affect the total operating earnings of a firm, as they are determined
by the investment decisions, it can affect the share of earnings belonging to the
ordinary shareholders. The capital structure decision can influence the value of
the firm through the earnings available to the shareholders. But the leverage
can largely influence the value of the firm through the cost of capital. In
exploring the relationship between leverage and value of a firm the relationship
between leverage and cost of capital from the standpoint of valuation.
The importance of an appropriate capital structure is, thus, obvious.
There is a viewpoint that strongly supports the close relationship between
leverage and value of a firm. There is an equally strong body of opinion, which
believes that financing-mix or the combination of debt and equity has no impact
on the shareholders wealth and the decision on financial structure is irrelevant.
In other words, there is nothing such as optimum capital structure.
[1]
Capital structure theories are based on certain assumptions, they are:

There are only two sources of funds used by a firm: perpetual risk less
debt and ordinary shares.
45
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9]
There are no corporate taxes. This assumption is removed later.

The dividend-payout ratio is 100. That is, the total earnings are paid out
as dividend to the shareholders and there are no retained earnings.
The total assets are given and do not change. The investment decisions
are, in other words, assumed to be constant.
The total financing remains constant. The firm can change its degree of
leverage (capital structure) either by selling shares and use the proceeds
to retire debentures or by raising more debt and reduce the equity capital.
The operating profits (EBIT) are not expected to grow.
All investors are assumed to have the same subjective probability
distribution of the future expected EBIT for a given firm.
Business risk is constant over time and is assumed to be independent of
its capital structure and financial risk.
Perpetual life of the firm.
Leverage Analysis:
A firm can make use of different sources of financing whose costs are different.
These sources may be, for purposes of exposition, classified into those that
carry a fixed rate of return and those on which the returns vary. The fixed
returns on some sources of finance have implications for those who are entitled
to a variable return. Thus, since debt involves the payment of a stated rte of
interest, the return to the ordinary shareholders is affected by the magnitude of
debt in the capital structure of a firm.
The employment of an asset or source of funds for which the firm has to pay a
fixed cost or fixed return may be termed as leverage. Consequently, the
earnings available to the shareholders as also the risk are affected. If earnings
les the variable costs exceed the fixed cost, or earnings before interest and taxes
exceed the fixed return requirement, the leverage is called favorable. When they
do not, the result is unfavorable leverage.
There are 2 types of leverage- operating and financial. The leverage
associated with investment (asset acquisition) activities is referred to as
operating leverage, while leverage associated with financing activities is called
financial leverage. While we are basically concerned with financial leverage for
purposes of the financing decision of a firm, the discussion of operating
leverage is to serve as a background to the understanding of financial leverage
because the two types of leverage are closely related. Operating leverage is
46
determined by the relationship between the firms sales revenues and its
earnings before interest and taxes (EBIT). The earnings before interest and
taxes are also generally called as operating profits. Financial leverage
represents the relationship between the firms earnings before interest and taxes
(operating profits) and the earnings available for ordinary shareholders. The
operating profits (EBIT) are thus, used as the pivotal point in defining operating
and financial leverage. In a way, operating and financial leverage represent two
stages in the stages in the process of determining the earnings available to the
equity shareholders and, hence, their discussion in this chapter. Apart from the
elaboration of the return-risk implications, their combined effect has also been
discussed.
Operating leverage results from the existence of fixed operating expenses
in the firms income stream. The operating leverage may be defined as the
firms ability to use fixed operating costs to magnify the effects of changes in
sales on its earnings before interest and taxes. Operating leverage occurs any
time a firm has fixed costs that must be met regardless of volume. We employ
assets with fixed cost in the hope that volume will produce revenues more than
sufficient to cover all fixed and variable costs. In other words, with fixed costs,
the percentage change in profits accompanying a change in volume is greater
than the percentage change in volume. This occurrence is known as operating
leverage.
Financial leverage relates to the financing activities of a firm. The
sources from which funds can be raised by a firm, from the point of view of the
cost/charges, can be categorized into [1] those which carry a fixed financial
charge, and [2] those which do not involve any fixed charge. The sources of
funds in the first category consist of various types of long-term debt, including
bonds, debentures, and preference shares. Long-term debts carry a fixed rate of
interest which is a contractual obligation for the firm. Although the dividend on
preference shares is not a contractual obligation, it is fixed charge and must be
paid before anything is paid to the ordinary shareholders. The equity
shareholders are entitled to the remainder of the operating profits of the firm
after all the prior obligations are met. Financial leverage results from the
presence of fixed financial charges in the firms income stream. These fixed
charges do not vary with the earnings before interest and taxes (EBIT) or
operating profits.
Capital Budgeting:
47
Capital budgeting decision pertains to fixed/long-term assets which by

definition refer to assets which are in operation, and yield a return, over a
period of time, usually, exceeding one year. They therefore, involve a current
outlay or series of outlays of cash resources in return for an anticipated flow of
future benefits. In other words, the system of capital budgeting is employed to
evaluate expenditure decisions which involve current outlays but are likely to
produce benefits over a period of time longer than one year. These benefits may
be either in the form of increased revenues or reduced costs. Capital
expenditure management, therefore, includes addition, disposition, modification
and replacement of fixed assets.
Capital budgeting decisions are of paramount importance in financial
decision-making. In the first place, such decisions affect the profitability of a
firm. They also have a bearing on the competitive position of the enterprise
mainly because of the fact that they relate to fixed assets. The fixed assets
represent, in a sense, the true earning assets of the firm. They enable the firm to
generate finished goods that can ultimately be sold for profit. The current assets
are not generally earning assets. Rather, they provide a buffer that allows the
firms to make sales and extend credit. True, current assets are important to
operations, but without fixed assets to generate finished products that can be
converted into current assets, the firm would not be able to operate. Further,
they are strategic investment decisions as against tactical- which involve a
relatively small amount of funds. Therefore, such capital investment decisions
may result in a major departure from what the company has been doing in the
past. Acceptance of a strategic investment will involve a significant change in
the companys expected profits and in the risks to which these profits will be
subject.
Working Capital Management:

Working capital management is concerned with the
problems that arise in attempting to manage the current
assets, the current liabilities and the interrelationship that
exists between them. The term current assets refer to those
assets which in the ordinary course of business can be, or will
be, converted into cash within one year without undergoing a
diminution in value and without disrupting the operations of
48
the firm. The major current assets are cash, marketable

securities, accounts receivable and inventory.
Current liabilities are those liabilities which are intended,
at their inception, to be paid in the ordinary course of business,
within a year, out of the current assets or earnings of the
concern. The basic current liabilities are accounts payable, bills
payable, bank overdraft, and outstanding expenses. The goal of
working capital management is to manage the firms current
assets and liabilities in such a way that a satisfactory level of
working capital, it is likely to become insolvent and may even
be forced into bankruptcy. The current assets should be large
enough to cover its current liabilities in order to ensure a
reasonable margin of safety. Each of the current assets must be
managed efficiently in order to maintain the liquidity of the firm
while not keeping too high a level of any one of them. Each of
the short-term sources of financing must be continuously
managed to ensure that they are obtained ad used in the best
possible way. The interaction between current assets and
current liabilities is, therefore, the main theme of the working
capital management.
Receivables Management:
The receivables represent an important component of the
current assets of a firm. The receivables are defined as debt
owned to the firm by customers arising from sale of goods or
services and in the ordinary course of businesses. When a firm
makes an ordinary sale of goods or services and does not
receive payment, the firm grants trade credit and creates
accounts receivable, which could be collected in the future.
Receivables management is also called trade credit
management. Thus, accounts receivables represent an
extension of credit to customers, allowing them a reasonable
period of time in which to pay for the goods received.
The sale of goods on credit is an essential part of the
modern competitive economic systems. In fact, credit sales
and, therefore, receivables are treated as a marketing tool to
aid the sale of goods. The credit sales are generally made on
open account in the sense that there are no formal
acknowledgements of debt obligations through a financial
49
instrument. As a marketing tool, they are intended to promote

sales and thereby profits. However, extension of credit involves
risk and cost. Management should weigh the benefits as well as
cost to determine the goal of receivables management. The
objective of receivables management is to promote sales and
profits until point is reached where the return on investment in
further funding receivables is less than the cost of funds raised
to finance that additional credit (i.e. cost of capital). The
specific costs and benefits, which are relevant to the
determination of the objectives of receivables management,
are:
o
o
Cost
Collection cost
Capital cost
Delinquency cost
Default cost
Dividend policy:
Dividend refers to that portion of a firms net earnings
which are paid out to the shareholders. Since dividends are
distributed out of profits, the alternative to the payment of
dividends is the retention of earnings/profits. The retained
earnings constitute an easily accessible important source of
financing the investment requirements of firms. There is, thus,
a type of inverse relationship between retained earnings and
cash dividends. Larger the retention, lesser dividends; and
smaller retentions, larger dividends. Thus, the alternative uses
of the net earnings-dividends and retained earnings-are
competitive and conflicting.
A major decision of financial management is the dividend
decision in the sense that the firm has to choose between
distributing the profits to the shareholders and plugging them
back into the business. The choice would obviously hinge on
the effect of the decision on the maximizing present values; the
firm should be guided by the consideration as to which
50
alternative use is consistent with the goal of wealth

maximization. That is, the firm would be well advised to use the
net profits for paying dividends to the shareholders if the
payment will lead to the maximization of wealth of the owners.
If not, the firm should rather retain them to finance investment
programes. The relationship between dividends and value of
the firm should, therefore, be the decision criterion.
There are however, conflicting opinions regarding the
impact of dividends on the valuation of a firm. According to one
school of thought, dividends are irrelevant so that the amount
of dividends paid has no effect on the valuation of a firm. On
the other hand certain theories consider the dividend decision
as relevant to the value of the value of the firm measured in
terms of the market price of the shares. The crux of the
argument supporting the irrelevance of dividends to valuation
is that the dividend policy of a firm is a part of its financing
decision.
As a part of the financing decision, the dividend policy of
the firm is a residual decision and dividends are a passive
residual. If the dividend policy is strictly a financing decision,
whether dividends are paid out of profits, or earnings are
retained, will depend upon the available investment
opportunities. It implies that when a firm has sufficient
investment opportunities, it will retain the earnings to finance
them. Conversely, if acceptable investment opportunities are
inadequate, the implication is that the earnings would be
distributed to the shareholders.
The test of adequate acceptable investment opportunities
is the relationship between the return on investments and the
cost of capital. As long as investments exceed cost of capital, a
firm has acceptable investment opportunities. In other words,
ifs firm can earn a return higher tan its cost of capital; it will
retain the earnings to finance investment projects. If the
retained earnings fall short of the total funds required, it will
raise external funds-both equity and debt-to make up the
shortfall.
51
Annual Report Of Icici Prudential

Assets Under Management (AUM) as at the end of Feb-2007 (Rs in Lakhs)
AUM
Mutual Fund Name
Average AUM For The Month
Excluding Fund Of
Excluding Fund Of
Fund Of Funds
Fund Of Funds
Funds
Funds
527298.61
34793.7
520357.41
35962.1
1. ABN AMRO Mutual Fund

2. AIG Global Investment Group Mutual Fund
N/A
N/A
N/A
N/A
3. Benchmark Mutual Fund

4. Birla Sun Life Mutual Fund
5. BOB Mutual Fund
6. Canbank Mutual Fund
7. DBS Chola Mutual Fund
8. Deutsche Mutual Fund
9. DSP Merrill Lynch Mutual Fund
10. Escorts Mutual Fund
11. Fidelity Mutual Fund
493459.19
2107032.33
13189.46
220055.55
267272.69
632738.66
1363796.81
11892.52
567052.22
0
1901.45
0
0
0
0
0
0
7885.48
565300.47
2276874.74
12710.58
224400.85
236941.15
643309.79
1337579
9857
594872.17
0
2016.87
0
0
0
0
0
0
8669.47
12. Franklin Templeton Mutual Fund
2210219.06
32939.41
2343907.4
33551.3
3107988.05
1196159.48
465070.34
382811.94
N/A
1340625.72
1149722.96
123858.99
0
0
91168.93
0
N/A
55835.13
0
0
3222873.02
1219830.8
469516.87
386731.37
N/A
1335816.27
1197068.82
84093.35
0
0
97905.45
0
N/A
59243.32
0
0
13.
14.
15.
16.
17.
18.
19.
20.
HDFC Mutual Fund

HSBC Mutual Fund
ING Vysya Mutual Fund
JM Financial Mutual Fund
JPMorgan Mutual Fund
Kotak Mahindra Mutual Fund
LIC Mutual Fund
Lotus India Mutual Fund
52
21.
22.
23.
24.
25.
26.
27.
Morgan Stanley Mutual Fund

PRINCIPAL Mutual Fund
ICICI PRUDENTIAL Mutual Fund
Quantum Mutual Fund
Reliance Mutual Fund
Sahara Mutual Fund
SBI Mutual Fund
28. Standard Chartered Mutual Fund

29. Sundaram BNP Paribas Mutual Fund
30. Tata Mutual Fund
31. Taurus Mutual Fund
32. UTI Mutual Fund
Grand Total
287119.9
1060032.69
4328067.51
5380.17
4221591.34
17596.99
1847383.96
0
0
3731.96
0
0
0
0
310427.14
1094027.66
3907924.85
5818.48
4359281.53
16987.98
1874050.79
0
0
3982.85
0
0
0
0
1299706.71
2886.65
1381960.47
2861.86
780107.96
793897.25
1419829.99
23543.31
3860299.44
35330904.55
0
0
0
231142.71
1448329.74
25362.02
3926014.55
35826123.52
0
0
0
244193.22
Asset Under Management

Mutual Fund Name
AUM
Equity &
Balance
Debt &
MIP
ABN AMRO Mutual Fund
1580.36
464.589.
1115.92
29.39
70.61
Alliance Capital Mutual Fund
1431.46
589.48
841.98
41.18
58.82
10049.66
1668.77
8380.89
16.61
83.39
Canbank Mutual Fund
1565.19
224.35
1340.84
14.33
85.67
Chola Mutual Fund
1004.62
232.63
771.99
23.16
76.84
Deutsche Mutual Fund
2366.72
96.57
2270.15
4.08
95.92
DSP Merrill Lynch Mutual Fund
6472.80
1462.33
5010.47
22.59
77.41
Fidelity Mutual Fund
1628.06
1628.06
0.00
100.00
0.00
Franklin Templeton Mutual Fund
16704.74
6965.36
9739.38
41.70
58.30
HDFC Mutual Fund
15707.82
6126.04
9581.78
39.00
61.00
HSBC Mutual Fund
7250.63
1987.93
5262.70
27.42
72.58
ING Vysya Mutual Fund
2072.86
337.25
1735.62
16.27
83.73
JM Financial Mutual Fund
3780.83
85.52
3694.51
2.26
97.74
Kotak Mahindra Mutual Fund
6501.52
1065.12
5436.41
16.38
83.62
LIC Mutual Fund
2959.15
277.46
2681.69
9.38
90.62
PRINCIPAL Mutual Fund
6264.96
1682.48
4582.48
26.86
73.14
17095.89
2169.46
14926.4
4
12.69
87.31
Birla Sun Life Mutual Fund
Prudential ICICI Mutual Fund
Equity
%
Debt
%
53
Reliance Mutual Fund
9907.89
4226.40
5681.49
42.66
57.34
565.50
25.74
539.76
455
95.45
SBI Mutual Fund
7189.35
2311.54
4877.81
32.15
67.85
Standard Charted Mutual Fund
7636.86
0.00
7636.86
0.00
Sundaram Mutual Fund
2035.21
997.91
1037.31
49.03
100.0
0
50.97
Tata Mutual Fund
8713.95
2629.09
6084.86
30.17
69.83
170.76
157.53
13.23
92.25
7.75
21975.57
8791.81
Sahara Mutual Fund
Taurus Mutual Fund

UTI Mutual Fund
13183.7
40.01 59.99
7
List of Assets Management Companies and their assets under management
As on June 2006
Particulars
Diversified
Tax Planning
Index
Sector
Total Equity
FMP
MIP
Debt ST
Income
Total Debt
Balanced
Gilt LT
Gilt ST
Total Gilt
Liquid
Total
(In Crores.)
ICICI PRUDENTIAL
1593.8546
47.9336
2.0978
179.0116
2107.78
1551.236
823.2623
479.4336
3778.4525
6932.384
469.6412
412.9397
150.5677
563.5074
6961.6842
17095..89
(Above Table showing Acquisition and Utilization of fund of ICICI PRUDENTIAL)

Fund Manager does utilization of fund, ICICI PRUDENTIAL AMC has variety of scheme and each
scheme has different Fund Manager who is responsible of investing money into market and also
responsible to give return to investors.
54
RATIO ANALYSIS
Growth Fund
Ratio
Current
ratio
EPS
Formula
Current
asset/current
liability
Total
profit/unit
capital
2006
2005
2438.37/1818.15=1.34
1275.46/1066.90=1.19
23311.45/7700.63=3.02
14126.20/9981.01=1.4
1
Div payout
Div. paid/unit 941.81/7700.63=0.12(12%)Div. 621.86/9981.01=0.62(6
to unit
capital
paid/unit capital
.2%)
holders
Div.
Div. paid/net
621.86/14126.20=0.04(
941.81/23311.45=0.04(4%)
payout
profit
4%)
Div. to
Dividend/total
717.53/14882.68=0.48(
total
428.45/18041.54=0.24(2.4%)
income
4.8%)
income
Profit on
sales
Profit/sales
12074.52/14882.68=0.
redemption
13834.17/18041.54=0.77(77%)
redemption
81(81%)
to total
income
(Above Table Showing - Ratio analysis of ICICI PRUDENTIAL AMC)
55
56
Marketing Yesterday and Today

Today the definition of marketing has been changed. The marketing activity of an
organization before the product is produced and continues even after the product is
sold. In the buyer market of recent times the sharpest weapon that a company can
develop is globalize marketing place in the value creation and delivery. The proud and
demanding customer of today brings before corporate a critical fact, when the
customer is jury. It is the value generation for the customer that will separate the victor
from vanquished. The value of customer service cascades all over the company. The
aim of customer focus is not just satisfaction but delight satisfaction.
Till the year 1999 the life insurance business was exclusively conducted by the Life
Insurance Corporation (LIC) while the general insurance business in India, was
exclusive by General Insurance Corporation and its four subsidiaries. The insurance
sector is opened for private participation since November, 2000.
Before 1999 there was no marketing done by LIC due to its monopoly but now after 5
years the picture has changed. Now there are private players in market. With the
effective marketing techniques the private players has changed the whole scenario of
the insurance sector. They are slowly and gradually driving the business out of the
hands of the LIC. Before 1999 customer had no option other then LIC, but now they
have got many options.
This is the significant change in insurance industry. Now the customer is back in the
center state. All the companies are trying to please the customer with the innovative
schemes and better service.
Relationship Marketing in Insurance

Introduction
57
It is five times more expensive to acquire a new customer than to retain an old one.
Relationship marketing is the practice of building long term satisfying relationship
with key parties customers and suppliers. They accomplish this by promoting and
delivering high quality, goods, services, and fair prices to other parties overview.
Relationship marketing results in strong economic, technical and social ties among the
parties.
Definition of Relation Marketing:

Relationship marketing can be defined as the process to identify, establish, maintain
and other stakeholders at a profit so that the objective of all parties involved are net
and this is done by mutual exchange and fulfillment of promises.
The important objectives of relationship marketing to acquire new customers maintain
and enhance relationship with existing customers, re-activities of ex-customers and
handling of customer terminations. The key objective of relationship marketing is to
establish one to one relationship with all the customers. This may have sound like a
day dream few dream few years ago but thanks to the technological breakthrough and
technological solution providers, it is very much of a reality.
58
How to add value through relationship Marketing

Identify loyal customers
Recognize their special needs
Provide special reward for loyalty
Establish continuing relationship
Ensure increase in customer value
Relationship marketing is one of the hottest tread in the present marketing scenario.
Satisfied customers not only stay with a company but they are also walking talking
advertisement for the companys product.
59
60
The Operation department oils the work processes between the customer
and company to ensure consistent and quality service to the customer. To
streamline the operations, the operations department interfaces between the
clients and the agents, the branches and the under writers, and manages work
processes.
The vision at customer service

Is to deliver World Class Service at every opportunity. Units such as
the 9 to 9 contact centre, out bound call centre, customer care. And query
reduction unit are all committed across the country. ICICI Prudential has one
of the largest distribution networks amongst private life insurers in India,
having commenced operations in 58 cities and towns in India.
These are.. Agra, Ahmedabad, Ajmer, Amritsar, Aurangabad,
Bangalore, Bhopal, Calicat, Chandigrah, Chennai, Coimbatur, Dehradun,
Gurgaon, Hyderabad, Hubli, Indore, Jaipur, Jalandhar, Jamnagar, Kanpur,
karnal, Kochi, Kolkatta, Kota, Kolhapur, Kottayan, Lucknow, Ludhiana,
Madurai, Mangalore, Meerut, Mumbai, Nagpur, Nashik, Noida, New Delhi,
Patiala, Pune, Raipur, Rajkot, Ranchi, Surat, Thane, Thrissur, Trichy,
Trivendrum, Udaipur, Vadodara, Vashi, Vijayawada and Vizag.
The Company has twelve banc assurance tie-ups having agreements
with ICICI Bank, Federal Bank, South Indian Bank, Bank of India, Lord
Krishna Bank, Punjab and maharastra Co-Operative Bank, Goa State Cooperative Bank, Indoor Paraspar Sahakari Bank, Manipal State Co-Operative
and Jalgaon Peoples Co-Operative Bank, as well as some corporate agents. It
61
has tie-up with organizations like Dhan for Distribution of Salaam Zindgi, a
Policy for the socially and economically underprivileged sections of society.
ICICI Prudential has recruited and trained over 32000 insurance advisors to
interface with and advice customers. Further, it leverages is State-of the art IT
infrastructure to provide superior quality of service to customer.
The Operation Department of ICICI Prudential delivers the following services

to the customers such as:
Out Bound Call Centre
Customer Care
Query Resolution Unit
Policy Login Process
9 to 9 Contact Centre
Role of Information Technology in Operation Department:
The Information Technology function at ICICI Prudential is committed
to enables business through the use of technology. It is segmented into 4
groups to enable highest levels of delivery to the customers: Life Asia
Solutions Group that provides flexibility in designing better product offering to
end-users, the Solutions Group- Web that provides real-time information to
customers and is responsible for customer relationship management, IT
Architecture and Corporate Solutions Group is in charge of developing and
maintaining a blueprint for the IT Architecture for the enterprise as a whole.
This team works as an in house R & D Solution Group, exploring new
technological initiatives and also caters to information needs of corporate
functions in the organizations. IT Infrastructure group is responsible for
providing hardware, software, network services to the whole organization. This
group runs the Digital Nervous System of the Enterprise at the highest levels
of efficiency and provide robust, scalable and highly available platform for
development of business application.
62
With the help of Information Technology, an advisor and managers can

login the policy fro any of the offices of ICICI Prudential Ltd. And also with
the help of IT any employee or management can know any information, any
thing about the policy, advisors record, any branchs sales, any new schemes,
any managers record, and other thins at any time any place.
63
64
Introduction to HRM:Human resource management is a management function that helps

managers recruit, select, train and develops members for an organization. HRM
is concerned with the peoples dimension in organization. Manpower or
human resource may be thought of as the total knowledge, shills, creative
abilities, talents and aptitudes of an organizations work force, as well as the
values, attitudes and benefits of an individual involved. It is the sum total of
inherent abilities, acquired knowledge and shills represented by the talents and
aptitudes of the employed persons.
Of all the Ms in management (i.e. the management of materials,
machines, methods, money, motive power), the most important m for men or
human resources. It is the most valuable asset of an organization, and not the
money or physical equipment. It is in fact an important economic resource,
covering all human resources- organized or unorganized, employed or capable
of employment, working at all levels- supervisors, executives, government
employees, blue and white' collar workers, managerial, scientific,
engineering, technical, skilled or unskilled persons, who are employed in
creating, designing, developing, managing and operating productive and service
enterprises, and other economic activities.
Human resources are utilized to the maximum possible extent in order to
achieve individual and organizational goals. And organizations performance
and resulting productivity are directly proportional to the quantity of its human
resources
65
Organization Structure:Organization is a group of people working together cooperatively under

authority toward achieving goals and objectives that mutually benefit the
participants and the organization. A well-known author of HRM Allen says the
process of identifying and grouping the work to be performed, defining and
delegating responsibility and authority, and establishing relationships for the
purpose of enabling people to work most effectively together in establishing of
objectives
The essence of this definition is that people who work together require a
defined system or structure through which they relate to each other and through
which their efforts can be coordinated. Every organization has goals or
objectives for its existence. In the case of Personnel Management, it is to
optimize the effectiveness of human resources. These goals can be achieved
more suitably if the behavior of the workers and the composition of the
organization can be predicted and integrated cooperatively. The formal
organization structure attempts to give order and unity to the actions and efforts
of those who work together.
An organization tries to establish an effective behavioral relationship
among selected employees and in selected work places in order that a group
may work together effectively. There are three kinds of work which must be
performed whenever an organization comes into being:
o Division of labor
o Combination of labour and
o Coordination
66
The organization structure at ICICI web trade is somewhat like this:

C.E.O. Mr. K.V. Kamath
Board of Directors
National Head (at Mumbai-branch)
Unit manger/ In charge of

Gujarat region (at Junagadh)
Assistant unit manager

(Mr. Darshan Pandit: at Junagadh branch)
Sales
Sales
Sales
Sales
Executive
Executive
Executive
Executive
In any organization there is what is termed a hierarchy, refers to

various levels of authority in an organization, ranging from the Board of
Directors at the top to the sales executives at the bottom.
Human Resource Planning:R.K.College of Business Management
67
Human resource planning can be explained as the process by which a

management determines how an organization should move from its current
manpower position to its desired manpower position. Through planning, a
management strives to have the right number and right kind of people at the
right places, at the right time to do things which result in both the organization
and the individual receiving the maximum long-range benefit.
Coloman has defined human resource or manpower planning as the
process of determining manpower requirements and the means for meeting
those requirements in order to carry out the integrated plan of the organization.
Stainer defines HRM as Strategy for the acquisition, utilization,
improvement, and preservation of an enterprises human resources. It relates to
establishing job specifications or the quantitative requirements of jobs
determining the number of personnel required and developing sources of
manpower.
Human resources planning are a double-edged weapon. If used properly,
it leads to the maximum utilization of human resources, reduces excessive labor
turnover and high absenteeism; improves productivity and aids in achieving the
objectives of an organization. Faultily used, it leads to disruption in the flow of
work, lower production, less job satisfaction, high cost of production and
constant headaches for the management personnel. Therefore, for the success of
an enterprise, human resource planning is a very important function, which can
be neglected only at its own peril. It is as necessary as planning for production,
marketing, or own peril. It is as necessary as planning for production marketing,
or capital investment.
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Recruitment Sources:Human resource planning helps to determine the number and type of
people an organization needs. Job analysis and job design specify the tasks and
duties of jobs and the qualifications expected from prospective jobholders. The
next logical step is to hire the right number of people of the right broad groups
of activities. Recruitment forms the first stage in the process which continues
with selection and ceases with the placement of the candidate. It is the next step
in the procurement function, the first being the manpower planning. Recruiting
makes it possible to acquire the number and types of people necessary to ensure
the continued operation of the organization.
Recruiting is the discovering of potential applicants for actual or
anticipated organizational vacancies. In other words, it is linking activity
bringing together those with jobs and those seeking jobs. As Dale Yoder and
other point out: Recruitment is a process to discover the sources of manpower
to meet the requirements of the staffing schedule and to employ effective
measures for attracting that manpower in adequate numbers to facilitate
effective selection of an efficient working force. Accordingly, the purpose of
recruitment is to locate sources of manpower to meet job requirements and job
specifications.
Recruitment has been regarded as the most important function of
personnel administration, because unless the right types of people are hired,
even the best plans, organization charts and control systems would not do much
good. Flippo views recruitment both as positive and negative activity. He
says it is a process of searching for prospective employees and stimulating and
encouraging them to apply for jobs in an organization. It is often termed
positive in that it stimulates people to apply for jobs to increase the hiring
ratio i.e. the number of applicants for a job. Selection, on the other hand tends
to be negative because it rejects a good member of those who apply, leaving
only the best to be hired.
69
MANPOWER PLANNING AT ICICI PRUDENTIAL

Human Resource Planning is the process by which an organization ensures that it has the right
number and kind of people, at the right place, at the right time, capable of effectively and efficiently
competing those tasks that will help the organization achieve its overall objectives. Human Resource
Planning translates the organizations objectives and plans into the number of workers meet those
objectives. Without a clear-cut planning, estimation of an organizations human resource need is
reduced to mere guesswork.
ICICI PRUDENTIAL Asset Management Company considers several factor in HRP are strategy of
company, organization planning about new schemes, environment uncertainties, time horizons, and
nature of jobs being filled. By considering these entire factors it helps to ICICI PRUDENTIAL to
coping with change, creates highly talented personnel, and helps to determine futures needs.
Manpower planning is needed with respect to persons who can work as sub-broker for the companies.
Companies focused on Insurance Advisor and post office agent, Tax consultants and CAs for making
sub-broker. ICICI PRUDENTIAL AMC Forecast HR Demand it estimates the future quantity and
quality of people required. It uses forecasting technique that is Management Judgment that involves
bottom-up or top-down approach. After forecasting company forecast about HR supply that may
be from Existing human resource, internal sources or External sources.
70
RECRUITMENT
The upper level members like zonal managers, regional managers, branch managers and senior
executives are recruited. The regional manager has authority to select lower level employee like peon,
marketing executives, financial accountant etc. by approval of zonal manager.
ICICI PRUDENTIAL AMC recruits through following sources:
Internal Sources:
Present Employees
Employee Referrals
Previous Applicants
External Sources:
Advertisement
Campus interview
Consultants
Walk-ins
SELECTION
Selection is a process to select a fixed number of personnel from a large number of applicant received
by employees, seeking the job and selecting those who suitable for the given job selection includes a
number of steps. The purpose of selection is to pick up the right person for every job.
A scientific procedures of selection, requires 2 things:
1. Knowledge regarding the qualities which a person should posses in order to do the given job
properly
2. The evaluation of qualities possessed by a candidate for the job.
Prudential ICICI has adopted the following steps for selection procedure:
PRELIMINARY INTERVIEW
The main purpose of preliminary interview is to screen out those who are unsuitable. Those
interviews are quite short. If candidates are found suitable then an application blank may be given to
him to fill up and return.
In ICICI PRUDENTIAL AMC regional manager first interviews candidates, and if selected than he is
interviewed by zonal manager & if he is found suitable than an application blank is given to them.
71
APPLICATION BLANK
Here the applicants are asked to complete a blank that provides space for him to record data relating
to the name of candidates, experience etc. The application blank must not be too lengthy. In Pru ICICI
AMC this application blank is forwarded to Mumbai branch to hr department.
INTERVIEW
After the application blank reaches to the HR Department Mumbai, a telephonic interview is
conducted by HR Manager to see that the regional manager & zonal manager has made the right
choice or not.
MEDICAL CHECK UP
If the candidates clears all the above stages, company checks his medical report the basic purpose of
medical check-up is to determine the job for which candidate is fit or not.
REFRENCES
Checking of references is an important part of selection process. The company prefers to select the
candidate within the group or if the candidate gives the name of reputed person as his references.
FINAL SELECTION
If the candidate passes successfully from the above stages he is finally selected for the post. The final
selection lies with the regional manager.
PLACEMENT
The last stage in selection process is the placement of candidate. After the final selection is done, the
selected candidate is finally placed on the job.
TRAINING
THERE ARE TWO TYPES OF TRAINING PROGRAMS:
ON THE JOB TRAINING
OFF THE JOB TRAINING
72
Continuous training and upgrading technical, behavioral and managerial skills is a way of life in
ICICI PRUDENTIAL AMC. ICICI PRUDENTIAL AMC encourages agent or sub-broker to hone
their skills regularly to enable them to face the challenges of the changing requirements of customers
that fit market up and down.
Training needs analysis is done on a regular basis and systematic methodologies are ensured that
skills and capabilities of all agents are constantly upgraded to enable them to perform in the
challenging work. There is special training session at regular time period in local branch to all
financial consultant and agents about new scheme and to improve their effectiveness.
73
PERFORMANCE APPRAISAL
It is the systematic evaluation of the individual with respect to his or her performance on the
job and his or her potential for development.
Objective of Performance appraisal if for Developmental uses for agents and Financial Consultants,
for wages, transfer, promotion, for documentation and for organizational purpose like Human
Resource Planning, Job analysis and for training and development.
ICICI PRUDENTIAL first set the objective of performance appraisal then in establish job expectation
and then decide whose performance should be rated and who the raters are. Basically raters are
immediate supervisor, subordinates, peers, clients. For Performance Appraisal modern method is used
like MBO (Management By Objectives) and 360 appraisal. But there is some limitation like Hello
effect, Bias, Perception factor, Spill over etc
Selection Methods:
The selection procedure is concerned with securing relevant information
about an applicant. This information is secured in a number of steps or stages.
The objective of selection process is to determine whether an applicant meets
the qualifications for a specific job and to choose the applicant who is most
likely to perform well in that job.
The hiring procedure is not a single act but it is essentially a series of
methods or steps or stages by which additional information is secured about the
applicant. At each stage, facts may come to light which may lead to the
rejection of the applicant. A procedure may be compared to a series of
successive hurdles or barriers which an applicant must cross. These are
intended as screens, and they are designed to eliminate an unqualified applicant
at any point in the process. This technique is including all these hurdles.
Placement & Induction:Placement at ICICI bank is done very critically. The human resources are
considered very critical and are said to be main power of the bank. The CEO
Mr. K. V. Kamath says, Human capital is very important at ICICI. Training is a
big thing; each employee spends at least 69 hours during the year recharging
himself. Placement is done on the qualification and merit basis. Generally for
the retail banking and other in house jobs placement is done on the basis of the
interviews by branch and regional heads. They select only those competent
people who are ready to work round the clock and have full dedication towards
the bank.
74
Induction is a technique by which a new employee is rehabilitated into the

changed surroundings and introduced to the practices, policies and purposes of
the organization. In other words, it is a welcoming process-the idea is to
welcome a new comer, make him feel at home and generate in him a feeling
that his own job, however small, is meaningful and has significance as a part of
the total organization.
When a new comer joins an organization, he is an utter stranger to the
people, work place and work environment. He may feel insecure, shy and
nervous. The first few days may be anxious and disturbing ones for him. He
may have anxiety caused by not following the usual practices prevalent in the
organization, or the haphazard procedures, and lack of information. These may
develop discouragement, disillusionment or defensive behavior. Induction leads
to reduction of such anxieties; dispels the irrational fears present employees and
hold colleagues responsible for assisting the new comer so that he may feel
confident. ICICI says that, newcomers are to be a part of informal
identification of talent apart, there is a formal process. It starts form induction,
where newcomers are subject to the OPQ (occupational personality
questionnaire). The tests have also been conducted right up to the general
manager and senior general manger.
75
Training and Development:ICICI is a kind of private sector bank where if you are confident and
competent then you can get your carrier advancement and development at a
very high speed. CEO Mr. K. V. Kamath says, There are several young people
in our organization who are on the threshold of making it to the board. He
himself has this habit of dropping in unannounced on people tow or three levels
below him. It helps him to keep a tab on things and also to find out who is
knocking on top management doors. His management by walking about also
takes him to the basement, to see that everything is spick and span. He does like
to get to the bottom of things.
At ICICI executive development programme is more important. Because
they believe that if the executives are properly trained, properly motivated and
fully focused then they can guide any kind of work force. All those persons who
have authority over others and are responsible for their activities and for the
operations of an enterprise are managers. In a business organization, the coordination and direction of the efforts of others is a major part of the
management job. The manager has to deal not only with the staff but also with
others outside his own group, and has decided influence on the organization.
Performance Appraisal Policy:Once the employee has been selected, trained and motivated, he is then
appraised for his performance. Performance appraisal is the step where the
management finds out how effective it has been at hiring and placing
employees. If any problems are identified, steps are taken to communicate with
the employee and to remedy them. A performance appraisal is a process of
evaluation an employees performance of a job in terms of its requirements.
76
77
Objectives
To Study the Brand awareness of the new product i.e. Unit Linked
Insurance Plans in Ahmedabad City.
To know what are the priorities of people of city for making investment in
Insurance.
To know what are the perception of the consumer about ICICI Prudential
Life Insurance Co.
To know the standing of the ICICI Prudential Life Insurance Co. in
Ahmedabad City.
Data Source:
The data would be collected from both primary as well as secondary source.
Consumers would be asked to fill questionnaires to arrive at the information.
Various secondary sources of data as magazines, journal, Internet etc. would
also be explored.
Sampling Area:
The sampling areas of this research are Ahmedabad.
Sampling method:
The convenient sampling method was used for this research and the
respondents were those who have already taken life insurance policy.
Sample Size:
The size of this research is 50 respondents.
Research Instrument:
The research instruments, which was used, for collecting the data is
questionnaire.
Method of contact:
The method of contact would be personal and direct as this would help
to qualify the customers issues while filling up the questionnaire and also helps
them if they do not have the knowledge about any insurance plan of the
company.
Method of making an approach for Sales:
78
After analyzing the data form the questionnaires the needs of prospects
were identified and the best suitable insurance solution was suggested to them
accordingly.
Data Collection and Analysis

Q.1. Do you have a Life Insurance Policy?
Criteria
Yes
No
No. Of Respondents
50
0
As our sample is those people who have insurance so all the respondents are
falling under the Yes criteria.
Q.2. Which Companys Insurance Policies do you have?
Company
No. of Respondents
LIC
50
Birla Sunlife
SBI
ICICI Pru. Life
10
Kotak Mahindra
Post Office
15
HDFC
79
As from the above chart it is very clear the all of the respondents have an
insurance of the LIC while some of them have an insurance of the other
companies like post Office, ICICI Prudential Life insurance Co., HDFC Co.
Etc.
The reason behind this is that the LIC competitor since more than four
decades and the Indian Govt. allowed the Introduction of private player in
Insurance in the year 2000.
Q.3
What is amount of insurance premium you pay annually?

Criteria
Below Rs. 10,000
10,000 to 20,000
20,000 to 30,000
30,000 to 40,000
Above 40,000
No. of Respondents
11
18
6
5
10
The analysis of the above available data is merely to find out the percentage of
income that one is willing to invest in insurance.
Q.4
What priorities would you consider most important, while

purchasing a policy?
80
Criteria/Rank
Death Benefit
Childrens
Future
Retirement
Planning
Tax Planning
Financial
Planning
1
29
7
2
10
13
3
6
21
4
2
3
5
3
0
Total
50
44
20
43
8
2
18
5
8
3
8
11
6
25
48
46
From the table and chart it can be say that most of the people rank death benefit
first for the decision to make investment in Insurance. Their second priority is
tax planning because the premium, which is paid by the people towards
Insurance, is deductible up to certain limit from the income and also the
maturity amount is also tax free. The third and fourth priorities are childrens
future and retirement planning.
Q.5
Do you have any knowledge of the stock market?
81
Criteria
Yes
No
No. of Respondents
32
18
Q.6 If Yes do you have any knowledge about unit linked insurance
plans?
Criteria
Yes
No
No. of Respondents
25
7
The question number 5 and 6 are designed to know the awareness of people
who have knowledge of share market or deals in shares also have the
knowledge of the new modern insurance product i.e. Unit Linked Insurance
Plan. From the available data it can be say that those who deal in shares are also
aware of the ULIP.
Q.7
Is your current Insurance policy Unit Linked or Traditional?

Criteria
Only Unit Linked
Only Traditional
Both
No. of Respondents
0
39
11
From the Q. No. 7 we can say that even though the modern products available
in the market since more than two years and which are having the more
flexibility and also giving the higher return than traditional one most of the
82
people do not have or may be not aware of it which shows the lack of brand
awareness and it requires an aggressive promotional efforts on the part of
company.
There is a lot of scope available for the company to attract more customers by
giving or introducing most suitable ULIP products and at the same time increase
the customer base.
Q.8
If given a choice, where would you like to invest your money?

(Please Rank Your Choice)
Choice/Rank
Mutual Fund
Insurance
Gold
Equities
Post Office
Debenture
Bank Deposit
Other
1
0
4
4
17
22
0
0
10
2
1
12
8
3
12
2
6
5
3
5
14
1
0
12
4
12
0
4
1
4
2
5
2
10
19
2
5
25
8
2
2
2
1
1
1
6
12
3
5
6
0
14
0
0
7
5
0
13
1
0
2
3
0
8
1
0
13
0
0
0
1
2
Total
50
45
48
34
50
33
42
20
This question is mainly designed to know the investment priorities of the people
of Ahmedabad town. The objective behind this Q. is that after the Charotar
Nagrik Co-oprerative Bank and other Credit Societies, which are giving higher
83
interest on deposits, the whole scenario of city is changed. Most of the people
prefer to invest in post office saving schemes and where their money is safe
even though the return is very less. So there is a great need to divert the efforts
of the company towards the safety and security as ICICI Prulife is a private
insurance Company.
Q.9
According to you what are the factors that would affect you decision
while purchasing an insurance policy?
Criteria/Rank
Premium
Return
Safety
Liquidity
Market
Condition
1
12
21
20
1
1
2
15
17
14
1
2
3
15
8
15
9
0
4
6
2
1
18
16
5
2
2
0
21
21
50
50
50
50
50
40
The question No. 9 is designed to know which the factors are affecting
the most to the prospect while making decision to invest in insurance. As far as
investment in insurance is concerned most of the people want that it should be
safe and at the same time giving the compatible returns because insurance is not
only for death benefit it is also a saving tool for future. So the mix response of
respondents is welcomed. Available data is such that there is a bit ambiguity.
84
But we can say that the most affecting factors to the prospect are return and
safety. As per the finance theory risk and return goes in hand in hand but as far
as insurance is concerned it is all about the compatible and safe returns over
others.
Q. 10 Are you or ay of your family members are planning to buy an
insurance policy in near future?
Criteria
Yes
No
No. of Respondents
13
37
This question is taken to collect the information of those respondents who are
going to plan to purchase insurance within near future that is used by the
company for making personal contact for sale.
Q. 11 Are your needs satisfied with your current investment in insurance?
Criteria
Yes
No
Q. 11(a)
No. of Respondents
10
30
If No, then give reasons?
Criteria
High Premium
Low Return
Poor Services
Others
No. of Respondents
0
1
7
2
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The question No.11 and 12 are designed to know the percentage of people who
are not satisfied with the current investment in insurance and also to know the
reasons behind it. So that the company can focus on those areas where the
competitors fail. Because now a days the competition is very stiff in the
insurance industry. All companies are trying to attract more customers by
anyhow. So it will be useful for designing the promotional schemes of the
company.
From the above table and chart it can be seen that the respondents who
are dissatisfied give the main reason behind it are poor services. There are many
others reasons like more time taken by the company for claim settlement, nondispatchment of cheques and other important vouchers, etc. So the company can
improve upon these and increase its market share by offering quality service to
the customers.
Q. 12 Do you know anything ICICI Prudential Life Insurance?
Criteria
Yes
No
No. of Respondents
30
20
Q. 13 If Yes, from where did you come to know about the company?
Criteria
Television
News Paper
Sales Representative
Others source
No. of Respondents
4
3
14
9
86
Q. 14 What do you feel about ICICI Prudential Life Insurance?

(Open Ended)
The question No.13, 14 and 15 are designed to know the company
awareness the respondents of the city and also the source of awareness. But I
felt very much difficulty while filling up these questions because most of the
people know about the company but they know it as an ICICI Bank not as a
different identity. So there is a great need to design the advertisement campaign
in such a way that it will create the different image of the company. The main
reason behind this is that the image of ICICI Bank in city is such that most of
the people ask for charges first than the service that it provides.
87
Q.1. Do you have a Life Insurance Policy?

Yes
No
Q.2. Which Companys Insurance Policies do you have?

(Please specify the numbers)
LIC
HDFC Standard Life
Birla Sunlife
Cholamandalam
SBI Life Insurance

New York MaxLife
Alliance Bajaj
ICICI Pru. Life Insurance
88
TATA AIG Insurance

ING Vysya
AVIVA Life
Q.3
MetLife Insurance
OM Kotak Mahindra
AMP Sanmar
What is amount of insurance premium you pay annually?

Amount
Q.4
What priorities would you consider most important, while

purchasing a policy? (Please Rank Your Choice)
Death Benefit
Childrens Education
Retirements Benefit
Tax Planning
Financial Planning
Q.5
you have any knowledge of the stock market?

Yes
Q.6
No
If Yes do you have any knowledge about unit linked insurance

plans?
Yes
Q.7
No
Is your current Insurance policy Unit Linked or Traditional?

Yes
No
89
Q.8
If given a choice, where would you like to invest your money?

Mutual Funds
Insurance Policies
Gold
Equities
Q.9
Post Office Schemes

Debentures
Banks (FDs etc.)
If other (specify)___________
According to you what are the factors that would affect you decision
while purchasing an insurance policy?
Premium
Return
Safety
Liquidity
Market Condition
Q. 10 Are you or any of your family members are planning to buy an

insurance policy in near future?
Yes
No
Q. 11 Are your needs satisfied with your current investment in insurance?

Yes
Q. 11 (a)
No
If No, then give reasons?
High Premium
Low Return
Poor Services
Other Reasons__________
______________________
90
Q. 12 Do you know anything ICICI Prudential Life Insurance?

Yes
No
Q. 13 If Yes, from where did you come to know about the company?
T.V.
Radio
Newspaper
Internet
Magazine
Hoarding
Others (Please Specify)_____________________________
Q. 14 What do you feel about ICICI Prudential Life Insurance?

__________________________________________________________
__________________________________________________________
_______________________________
91
So according to the data available form the survey one can conclude that even
though the Unit Linked Insurance Plans are very much popular in Metro and
semi cities, the product awareness of ULIP is very low among the people of city
and at the same time there is a need to create the different image of the company
among the people by any means like advertisement, seminars or meetings.
92
93
94
Strengths
o
o
o
o
o
o
o
Flexible Products
Partners having experience in different markets of
the world.
Synergy with exiting operations
Expertise in the field of insurance
Professional management
Good Customer service
Create a brand name
Weakness
Low capital base
Yet to build strong distribution network
Cannot tap rural market
Opportunities
o
o
Untapped market
Banks ready to tie up for as a readymade
distribution network for a small fee.
Threats
Large distribution network of LIC

Decades of experience and brand name of LIC
5% service tax on investments.
95
96
Website address
www.bimaonline.com
www.licindia.com
www.irdaindia.com
www.iciciprulife.com
Magazines
India Today
ICFAI Journal
Outlook Express
Materials
LIC literature and brochures
ICICI Prudential literature and brochures
97

Iciciprudential Life Insurance

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Summer Project Report

ICICI Prudential Life Insurance

R.K.College of Business Management

R.K.College of Business Management

R.K.College of Business Management

R.K.College of Business Management

R.K.College of Business Management

Objective of the Study

R.K.College of Business Management

R.K.College of Business Management

R.K.College of Business Management

Insurance is defined as a co-operative device to spread the

Every risk involves the loss of one or other kind. The

Provides for dependents in case of death.

Addresses health care concerns.

In the words of John Magee , Insurance is a plan by which

In the words of Sir William Bevridges , The collective

In the words of Boone & Kurtz , Insurance is a substitution

In the words of Thomas , Insurance is a provision, which a

In the words of Allen Z. Mayerson , Insurance is a device

In the words of D. S. Harsell , Insurance may be defined as

In the words of Robert I. Mehr & Emerson Cammark ,

In the words of Riegel & Miller , Insurance is a social

R.K.College of Business Management

R.K.College of Business Management

indemnity against losses. Moreover, insurable interest is present in

Based upon certain principle

R.K.College of Business Management

In order to go through the journey of LIC Path of private

Privatization of Life Insurance Sector

Life Insurance concept was accepted

In order to elaborate the above path lets go through the history of

R.K.College of Business Management

Right up to the end of the 19 t h century, foreign insurance

Policyholders will be provided cent percent security.

profitability. In spite of all these merits of LIC, the overall status

Above stated figures clearly shows that from 1 Billion population

Private Insurers in Indian Insurance Market

TATA AIG Life Insurance

R.K.College of Business Management

R.K.College of Business Management

LIFE INSURANCE CORPORATION OF INDIA

R.K.College of Business Management

To publicize & extent the insurance business specifically in

To provide suitable financial security at reasonable cost.

To make the investments more dynamic by popularizing the

To invest the insurance fund keeping with maximum benefit

To run the insurance business at minimum administrative

To function as trusts of the insureds.

To fulfill the needs of the society in a changing social and

To make the employees collectively responsible for providing

To develop work satisfaction among agents & employees.

R.K.College of Business Management

MAX NEW YORK LIFE INSURANCE COMPANY

ICICI PRUDENTIAL LIFE INSURANCE COMPANY

OM KOTAK MAHINDRA LIFE INSURANCE

BIRLA SUN LIFE INSURANCE COMPANY

TATA AIG LIFE INSURANCE COMPANY

SBI LIFE INSURANCE COMPANY

R.K.College of Business Management

R.K.College of Business Management

R.K.College of Business Management

R.K.College of Business Management

R.K.College of Business Management