AN ORGANISATIONAL STUDY

At

ICICI PRUDENTIAL LIFE INSURANCE COMPANY

Internship submitted in partial fulfillment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

of

BANGALORE UNIVERSITY

by

DHEERAJ SHARMA

Register No: 09201060

Under the guidance of

PROF. BARKATH UNISSA

CMR Institute of Management Studies

C.A. #2, 3rd C cross, 6th ‘A’ Main, HRBR layout

2nd Block, Kalyana Nagar

Bengaluru-560 043

2009-2010

1

STUDENT’S DECLARATION

I hereby declare that this Internship titled “AN ORGANIZATION STUDY AT THE

ICICI PRUDETIAL Nangal Punjab” submitted by me to the Department of

Management, Bangalore University in partial fulfillment of requirement of MBA

Programme is a bonafide work carried by me under the guidance of Prof. Barkath unissa,

Department of Management Program, CMRIMS (AUTONOMOUS). This has not been

submitted earlier to any other University or Institution for the award of any

degree/diploma/certificate or published any time before.

Place: Bangalore DHEERAJ SHARMA

Date: (09201060)

2

INTERNAL GUIDE CERTIFICATE

Certified that this Internship titled “AN ORGANIZATION STUDY AT THE ICICI

PRUDETIAL Nangal Punjab” submitted in partial fulfillment for the award of MBA

degree of Bangalore University, was carried out by Adil Bashir (Register Number:

09201060) under the guidance of Prof. Barkath unisssa, Department of Management

Program, CMRIMS (AUTONOMOUS). This has not been submitted to any other

University or Institute for the award of any degree/diploma/certificate or published any

time before.

Place: Bangalore PROF. BARKATH UNISSA

Date: Professor

3

EXTERNAL GUIDE CERTIFICATE

Certified that this Internship titled “ORGANIZATIONAL STUDY AT THE ICICI

PRUDENTIAL Nangal Punjab ” submitted in partial fulfillment for the award of MBA

degree of Bangalore University, was carried out by Dheeraj Sharma (Register Number:

09201060) under the guidance of Mr. Amit Kaushal Unit Manager . This has not

submitted to any other University or Institute for the award of any

degree/diploma/certificate or published any time before.

Place: Nangal Mr. Amit Kaushal

Date: Unit Manager

4

ACKNOWLEDGEMENT

First of all I express my gratitude to GOD for providing me mental and physical

capacities to carry out this Internship Project.

I express my gratitude to our beloved principal Mrs. Suja Bennet for allowing me to do

this internship study. I also express sincere thanks to our respected Director Prof. T.

Balachander for his guidance and support during the tenure of my project and I also thank

my project guide Prof. Barkath unissa, for her guidance and support in my project.

I express my profound thanks to Unit Manager for providing me an opportunity to do the

organizational study at ICICI PRUDENTIAL LIFE INSURANCE Nangal Punjab.

Special thanks are due to Mr. Amit Kaushal for his guidance and support during my stay

at Head Quarters and thereafter. Many departmental heads of ICICI PRUDENTIAL

contributed effectively towards the preparation of this report, by way of their guidance

and support, despite their busy schedule.

DHEERAJ SHARMA

5

EXECUTIVE SUMMARY

6

EXECUTIVE SUMMARY

ICICI Prudential Life Insurance is one of the largest Insurance networks in the country,

and 2nd Life Insurance Company in India. The ICICI Group has been in existence since

1955 when ICICI Ltd., was created. ICICI Prudential started in 2002 as subsidiary of

ICICI Ltd., Today ICICI Life Insurance has a customer base of 4 million with total assets

exceeding Rs.1, 00,000 Cr. making it the 2nd largest life insurance company in the

country, next only to LIC.

The Insurance sector, after the opening up, provides greater opportunities. Several global

players have emerged and the market has changed significantly. In the changed scenario,

the expectation is that the low Insurance premium as a percentage of GDP prevailing in

India will improve and will offer better opportunities to the insurance players.

Life Insurance sector is one of the key areas where enormous business potential exists. In

India currently the life insurance premium as a percentage of GDP is 1.3 per cent against

5.2 per cent in the US, but in the liberalized scenario, the life insurance

premiums were projected to grow at around 18% to 20% from Rs 215 billion in 1998- 99

to Rs 592 billion in 2004-05 and to Rs 1450 billion by 2009-10. Corporate non-life

premium was projected to grow from Rs 84 billion in 1998-99 to Rs 386 billion in 2009-

10 and personal line non-life from Rs 4 billion to Rs 51 billion.

In the life Insurance segment the Life Insurance Corporation of India (LIC) is the major

player. The LIC has 2050 branches. It is constituted in to seven Zones. Currently there

are 5, 60,000 LIC agents in India. General Insurance is another segment, which has been

growing at a faster pace.

7

TABLE OF CONTENTS

Chapter No.

Chapters Pg. No.

1.INDUSTRY PROFILE

1 - 18

2.COMPANY PROFILE

19-48

3.ORGANIZATIONAL HIERARCHY

49 – 52

4.FUNCTIONING OF DEPARTMENTS 4.1 Marketing 4.2 Finance 4.3 Human Resource

53-60

5.SWOT ANALYSIS

61-63

6.SPECIAL TASK

64-66

7.FINDINGS, SUGGESSIONS & CONCLUSION

67-70

Bibliography a

8

CHAPTER 1

INDUSTRY PROFILE

9

INDUSRTY PROFILE

1.1 Origin of Life Insurance

Life insurance was born in England when the first policy providing temporary cover for a

period of 12 months was issued as early as 1583 A.D. The Amicable Society started

granting fluctuating sum on death since 1705 and a fixed sum since 1757. With the

development of mortality tables, life insurance acquired a scientific character. The

Equitable Society founded in 1762 was the first society established on scientific basis.

1.2 Origin of Life Insurance in India

In India, after the failure of 2 British companies, the European and the Albert in 1870,

which attempted writing business on Indian lives, first Indian life assurance company was

formed in the same year called Bombay Mutual Assurance Society Ltd. It was followed

by Oriental life assurance Company limited in 1874, Bharat in 1896 and Empire of

India in 1897. The idea of insurance was born out of a desire of the people to share the

loss of an individual by many.

Originally, it was restricted to other forms of life insurance. It started with marine

insurance where the losses on account of perils of the sea were shared by all who were

engaged in trade. References to some forms of insurance have been found in the codes of

Hammurabi Manu.

The Swadeshi movement of 1905 provided impetus to the formation of several

companies such as the “Hindustan Cooperative”, the ‘United India’, the ‘Bombay life’,

the ‘National’. Further in the wake of freedom movement, number of companies such as

the ‘New India’, the ‘Jupiter’, and the ‘Lakshmi’ emerged.

10

The government began to exercise certain measure of control on insurance business by

passing ‘Insurance Act’ in 1912. In order to control the investment of funds, expenditure

and management, a comprehensive Act was passed known as ‘Insurance Act 1938’. To

control the affairs, the office of controller of insurance was established. The Act was

amended extensively in 1950.

1.3 Indian Insurance Market – History

Insurance has a long history in India. Life insurance in its current form was introduced in

1818 when Oriental Life Insurance Company began its operations in India. General

insurance was however a late entrant in 1850 when Triton insurance company set up its

base in Kolkata.

History of insurance in India can be bifurcated into 3 eras:

Life insurance was the first to be nationalized in 1956. Life Insurance Corporation of

India was formed by consolidating the operations of various life insurance companies.

General Insurance followed suit and was nationalized in 1973. General Insurance

Corporation of India was set up as the controlling body with New India, United India,

National and Oriental as its subsidiaries. The process of opening up of the insurance

sector was initiated against the background of Economic Reform Process which

commenced from 1991. For this purpose, Malhotra Committee was formed which

submitted report in 1994 and Insurance Regulatory Development Act (IRDA) was passed

in 1999. Subsequently, Indian Insurance was opened for private companies which began

operations since 2001.

1.4 Indian Insurance Market – History

For years now, private players have been active in the liberalized environment. The

insurance market has witnessed dynamic changes which include presence of a fairly large

number of insurers both life and non life segment. Most of the private insurance

companies have formed joint venture partnering well recognized foreign players across

the globe.

11

There are now 21 insurance companies operating in the Indian market. With many more

joint ventures in the offing, the insurance industry in India today stands at cross roads as

competition intensifies and companies prepare survival strategies in a de-tariffed

scenario. There is pressure from both within the country and outside on the Government

to increase the Foreign Direct Investment (FDI) limit from the current 26% to 49% which

would help JV partners to bring in funds for expansion.

1.5 Top 10 Players in Insurance Companies in India

1.5.a Life Insurance Corporation of India

Life Insurance Corporation (LIC) came into existence on 1st September 1956 through the

amalgamation of 154 Indian insurance companies, 16 non-Indian companies and 75

provident. The amalgamation was achieved with the help of Life Insurance Act passed by

the Parliament in the same year. The LIC was created with the goal of reaching all the

insurable people in the country and providing them financial coverage at a reasonable

price. In the year 1956, LIC had 5 zonal offices, 33 divisional offices and 212 branch

offices. With time there was a need for a branch office at every district headquarter and

many branches were opened, which raised the pace of the organization.

LIC now has 2048 fully computerized branch offices, 100 divisional offices, 7 zonal

offices and the corporate office. At present, online premium collection facility is being

offered in selected cities as LIC has tied up with some banks and service providers. For

providing customer satisfaction the organization has introduced various schemes such as

ECS, ATM premium payment facility, IVRS, Info centers which are set up in various

cities including Mumbai, Bangalore, Chennai, Kolkata, New Delhi, Pune and many more.

It has also come up with SATELLITE SAMPARK offices providing easy access to

policyholders. LIC has crossed many milestones and set standards for itself fostering

unmatched performance.

Objectives

12

• Holding the money with obligation and using it in the best possible manner in the

interests of the policyholder and the community.

• Bringing attractive savings plans and making them easily accessible to the policyholders.

• Giving attractive returns to the people and keeping in mind national priorities.

• Being trustworthy to the customers and develop the spirit of corporate social

responsibility.

• Spreading insurance in both rural and urban areas and covering all the insurable persons

at a reasonable cost.

• Bringing in plans and policies favorable to the changing environment.

• Providing efficient service and involving people in the organization for their satisfaction.

1.5.b Bajaj Allianz General Insurance Company Limited

Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj Auto

Limited and Allianz AG of Germany.

Bajaj Allianz General Insurance came into existence on 2nd May 2001, when it got

certification of Registration from the Insurance and Regulatory Development Authority.

Bajaj Auto has a share of 74%, whereas Allianz has the remaining 26%. In the very first

year, the company made a strong position for itself in the industry and was reckoned

amongst the top private insurers. The premium income of the company as on 31st March

2006 was Rs. 1285 crores, whereas the profit after tax made was Rs. 52 crores. Bajaj

Allianz has a Pan India network covering over 100 towns from Jammu to

Thiruvananthapuram and aims to spread its operations in many other cities.

The vision of the organization is to be the first choice for customers, and provide job

satisfaction to the employees and create shareholder value. The organization strives to

excel in its products and services, providing total customer satisfaction.

Bajaj Allianz serves customers in all areas of General and Health Insurance as well as

Risk Management. It has in-depth knowledge of the local market and extensive

13

distribution network with expertise, stability and experience. It has a capital base of Rs.

147 crores, and is allowed to serve both the General and Health insurance.

It has achieved iAAA rating, by ICRA Limited and has the highest claims- paying ability

and a stable position in the market. In a 2006 survey, Business World has rated it among

the Most Respected Companies, putting it at No.2 position in Insurance sector.

The Company provides the following products under general insurance:

• Travel Insurance

• Asset Insurance

• Health Insurance

• Corporate Insuranceccc

1.5.c ICICI Prudential Life Insurance Company

ICICI Prudential is a joint venture between ICICI bank and Prudential plc, both having

strong operations in their respective countries. ICICI bank is one of the leading banks in

India providing quality financial services and Prudential is an international financial

service provider headquartered at United Kingdom. ICICI and Prudential have respective

shares of 74% and 26%. The Company started operating in December 2000. Currently,

total capital with the company is Rs.18.15 billion.

ICICI Prudential was the first insurance company in India to receive a National Insurer

Financial Strength rating of AAA (Ind.) from Fitch ratings. It has been given the honour

of being among the Most Trusted Brands in the industry by Economic Times for 3

consecutive years. It has a network of 450 branches, over 1,50,000 insurance advisors

and 18 bancassurance partners.

As the organization grows and develops, it keeps introducing new range of products and

services and enhancing the quality of plans and solutions given to the customers. The

distribution network is one of the best, and is spreading across the length and breadth of

14

the country. As on December 31, 2006, it had made imprints in over 360 cities and towns

in India. It has over 1,75,000 advisors across the country, serving clients with full

commitment. It has tied up with ICICI Bank, Bank of India, Federal Bank, Lord Krishna

Bank, some co-operative banks, NGOs, MFIs and corporates for making inroads into the

rural areas.

Products

Insurance Solutions for Individuals: ICICI Prudential Life Insurance offers several novel,

customer-centric products for customers at every stage of life. The products and services

offered by the organization are in various fields, such as:

Savings & Wealth Creation Solutions

• Premier Life Gold

• LifeLink Super

• Invest Shield Life New

• Cash Plus

• Cash Bank

• Life Time Super & Life Time Plus

• Save 'n' Protect.

Retirement Solutions

• Life Link Super Pension

• Forever Life

• Immediate Annuity

• Life Time Super

Child Plans

• Education insurance - Smart Kid

15

Protection Solutions

• Life Guard

• Home Assure

Group Insurance Solutions

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

benefits to their employees.

• Group Immediate Annuities

• Group Term Plan

• Group Superannuation Plan

• Group Gratuity Plan

1.5.d ICICI Lombard General Insurance

ICICI Lombard General Insurance Company Limited is a joint venture between ICICI

Bank Limited and Fairfax Financial Holdings Limited. ICICI bank is India's second

largest bank; Fairfax is Canada-based, engaged in general insurance, reinsurance,

insurance claims management and investment management. ICICI Lombard General

Insurance Company commenced its operations in general insurance business in August

2001.

ICICI Lombard is India's number one private insurance company; it is also the first

general insurance company to be given certification of ISO 9001:2000. The company

provides simple and fast documentation, fast claims settlement, online policy issuance,

and comprehensive product line.

It has also been given iAAA rating by ICRA for having highest claims paying ability. In

the very first year of operations, it was able to reach financial breakeven and achieve

16

underwriting breakeven in the second year. Security is provided through encryption and it

is the first company to provide digitally signed documents. It has been honored as the

most Customer Responsive Company by the Economic Times. Times of India has

designated it as the Best Housing Insurance in the Smart Living Awards by 360 degrees.

It has also been awarded Gold Shield for "Excellence in Financial Reporting". It is

among the top three companies to be awarded the "General Insurance Company of the

Year" at the10th Asia Insurance Industry Awards.

Products

Business Solutions

• Industrial All Risk

• Fire and Special Perils

• Electronic Equipment Insurance

• Fidelity Insurance

• Consequential Loss (Fire) Insurance

• Tea Corp Insurance

• Burglary Insurance

• Machinery

Personal Solutions

• Group Personal Accidents

• Health

• Health Insurance

Project Solutions

• Contractors' All Risk

• Contractors' Plant & Machinery

• Erection All Risk

• Performance Guarantee

17

Liability Solutions

• Director's & Officers Liability

• Product Liability

• Workmen's Compensation

• Event Insurance

• Product Liability

Travel Insurance

• Senior Citizen Overseas Travel

• Individual Overseas Travel

• Corporate Overseas Travel

• Domestic Travel

1.5.e Birla Sun Life Insurance Company Limited.

Birla Sun Life Insurance Company Limited (BSLI) is a joint venture between Aditya

Birla Group and Sun Life Financial Inc. BSLI started functioning in March 2001 after

getting the certificate of registration from IRDA.

Birla Sun Life Insurance Company Limited introduced unit Linked Life Insurance

Solutions in India. Within a short span of time it was able to establish itself as a leading

player in the Private Life Insurance Industry. It has been innovative and come up with

customer-centric products to provide safety and services. The company has web-enabled

IT systems for better customer services and a strong distribution channel which is easily

approachable. The company shows corporate governance and a high degree of

transparency in all business practices. It has professional knowledge and global expertise

of Aditya Birla Group.

Birla Sun life Insurance has been providing first class financial solutions to its customers

and has been amongst the top three private sector life insurance companies.

18

Its mission is to be amongst the top players in the eyes of customers and the first choice

of insurance and retirement solutions to individuals and groups. These innovative

solutions are linked with global and technical expertise and are deployed by a multi-

channel distribution network and enhanced technology.

The company aims at keeping all people associated with it - customers, clients,

stakeholders and employees- happy and fully satisfied. It wants to provide value added

products and services to the customers, job satisfaction to employees and highest returns

to the shareholders.

Qualities like integrity, commitment, passion, and speed are the core values of the

company. The products offered by the company are:

Individual Life Protection

• Premium Back Term Plan

• Birla Sun Life Term Plan

Saving

• Simply Life

• Flexi Save Plus

• Supreme Life

• Life Companion

• Flexi Cash Flow

• Prime Life

• Flexi Save Plus

Children

• Children's Dream Plan

19

Retirement

• Flexi Secure Life Retirement Plan II

Riders

• Critical Illness Plus Rider

• Term Rider

• Waiver of Premium

• Critical Illness Rider

• Critical Illness - Woman Rider

• Accidental Death and Dismemberment Rider

1.5.f TATA AIG General Insurance

Tata AIG General Insurance Company Ltd. is a joint venture between Tata Sons and

American International Group, Inc. (AIG). The Tata Group is holding 74 per cent stake

and the rest 26 percent is held by AIG. The company has got the expertise, knowledge

and strength of both the organizations.

Tata AIG General Insurance Company was founded on January 22, 2001. It offers

general insurance in various categories, such as automobile, home, personal accident,

travel, energy, marine, property and casualty and specialized financial solutions.

Jamsetji Tata founded Tata Group in 1860s. It has an estimated turnover of around US $

14.25 billion. It has spread its operations in various fields such as steel, power, hotels,

airlines, software services, communications, etc. Some of its major projects have been

Tata Tea, Tata Steel, Tata Chemicals, Titan, Tanishq, Voltas, Westside and Tata Motors.

Its imprints are made on the telecommunication and technology sector. Regarding

telecommunications, it is the largest international long distance service provider.

Approximately two- third of the equity of Tata Sons is held by a host of national

institutions in science and technology, medical services and performing arts. By

20

combining the ethical values with business acumen and fulfilling its commitment to the

nation, it has become one of the largest groups in India.

American International Group, Inc. (AIG) is the leading international player in insurance

and financial services. Its network spreads across 130 nations. AIG member companies

serve all types of customers, be it commercial or individual. AIG is among the leading

insurers and the largest underwriter of insurance. Aircraft leasing, financial products and

trading are some of the services offered by AIG. AIG has a global expertise of fulfilling

the customer-centric needs. It has specialized investment management capabilities in

equities, fixed income, alternative investments and real estate. AIG's stock has been listed

in the New York Stock Exchange as well as stock exchanges in London, Paris,

Switzerland and Tokyo.

The organization caters to individuals, small businesses and corporates. Individual plans

include motor, home, accident & health and travel insurance, whereas corporate plans

include accident & health, travel, energy, property, marine and liability plans.

1.5.g New India Assurance Company

Sir Dorab Tata founded New India Assurance Company on 23rd July 1919. It has 1068

offices comprising of 26 regional offices, 393 divisional offices and 648 branches with

more than 21,000 employees.It is one of the largest Non- Life insurers in Afro- Asia and

the first one to cross Rs. 5,000 crores of Gross Premium. It has a global network

expanding in countries like Japan, U.K., Middle East, Fiji and Australia. Its international

operations started in 1920 and have spread across 24 countries having a network of 19

branches, 12 agencies, 2 associate companies and 2 subsidiary companies. The company

contributes 80% of total overseas premium in India.The company has a highly qualified

staff, which excel in both expertise and knowledge and are trained to provide satisfaction

to the customers. It is the only company able to establish strong relationships overseas

and has a record of successful trading outside India. The performance has been

outstanding and the company has been able to maintain a strong position in the market.

21

It has been the pioneer in various fields such as:

• Setting up an Aviation Insurance Department in 1946.

• Handling the complete insurance requirements of the Indian Shipping Fleet.

• Introduced its own Training School.

• Pioneering the concept of 'Model Office Training'.

• Creating department in Engineering insurance.

• Satellite insurance.

The company wants to develop itself as the best general insurance company in the

industry. It is concerned about the society and community, and provides financial security

at reasonable prices. The company gives utmost importance to customer needs and there

is transparency in its operations. Some of the policies and schemes introduced by the

company are:

• Public Liability Policy

• Jewellers Block Policy

• Pravasi Bharatiya Bima Yojana Policy

• Universal Health Insurance Scheme

• Fire Policy

1.5.h IFFCO Tokio General Insurance

IFFCO Tokio General Insurance is a customer-centric company aiming to be easily

accessible and approachable to all sections of society. It offers products and services that

provide quality at reasonable cost. The organization has the deep knowledge of IFFCO

and thus developed a business plan that has both stability and integrity.

It has set global standards for itself and is the only private general insurance company in

India to make 5 consecutive years of experience. ITGI has been one of the few companies

22

to show underwriting profits within four years of operations. The company focuses on

delivering creative solutions to its customers. IFFCO Tokio General Insurance has 273

employees present in 68 cities, dedicated to give full satisfaction to the customers. It is

the first company to underwrite mega policies for a fertilizer and automobile client.

1.5.i The Oriental Insurance Company Ltd.

The Oriental Insurance Company Ltd. (OICL) is one of the general insurance companies

under the support of the General Insurance Corporation (GIC) of India. It came into

existence in the year 1947 and is one of the oldest organizations in India. It caters to all

sections and sectors ranging from MNCs to rural sector. The headquarters of the

company are situated at Delhi and it has 21 Regional Offices, 311 Divisional Offices and

635 Branch offices.

It has a team of hard working employees, having the talent to take the company to new

heights. Also the company shows concern for both the employees and customers. It

provides special covers for large projects like power plants, steel plants and chemical

plants.

It believes in actively participating in economic growth by being a dynamic organization

catering to the society with full commitment and efficiency. The main objectives of the

company are to serve the insurance needs of the entire community, provide services at

reasonable cost, make optimum utilization of the funds, maintaining global standards,

minimization of losses and retention of business.

1.5.j HDFC Standard Life Insurance Company Limited

HDFC Standard Life Insurance Company Limited is one of the first companies to be

licensed by IRDA to operate in the Insurance sector. The company came into existence

23

on 14th August 2000. Both Crisil and ICRA have honored it with AAA Ratings.

Similarly Moody's and Standard and Poors have also honoured it AAA ratings. HDFC

holds 81.4% share in HDFC and the remaining 18.6% stake is with Standard Life. It

integrates the strong expertise and stability of Standard Life and HDFC.

It is one of the most trusted companies; it is easily accessible and approachable, offering

value services to its customers.

The company aims to provide:

• Innovative products to cater to different needs of different customers

• Customer service of the highest order

• Use of technology to improve service standards

• Value for money for customers

• Increasing market share

• Professionalism in carrying out business

The values ingrained in the company are to provide financial security to policyholders,

maintain trust and keep innovating to establish it as a unique player.

LIST OF LIFE INSURERS IN INDIA

1. Bajaj Allianz Life Insurance Company Limited

2. Birla Sun Life Insurance Co. Ltd

3. HDFC Standard Life Insurance Co. Ltd

4. ICICI Prudential Life Insurance Co. Ltd

5. ING Vysya Life Insurance Company Ltd.

6. Life Insurance Corporation of India

7. Max New York Life Insurance Co. Ltd

24

8. Met Life India Insurance Company Pvt. Ltd.

9. Kotak Mahindra Old Mutual Life Insurance Limited

10. SBI Life Insurance Co. Ltd

11. Tata AIG Life Insurance Company Limited

12. Reliance Life Insurance Company Limited.

13. Aviva Life Insurance Co. India Pvt. Ltd.

14. Sahara India Life Insurance Co, Ltd.

15. Shriram Life Insurance Co, Ltd.

16. Bharti AXA Life Insurance Company Ltd.

17. Future Generali Life Insurance Company Ltd.

18. IDBI Fortis Life Insurance Company Ltd.

19. Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd

20. DLF Pramerica Life Insurance

21. AEGON Re Insurance

25

CHAPTER 2

COMPANY PROFILE

26

ICICI Prudential Life Insurance Company

ICICI Prudential Life Insurance Company Limited (‘the Company’) a joint venture

between ICICI Bank Limited and Prudential plc of UK was incorporated on July20,

2000 as a company under the Companies Act, 1956 (‘the Act’). The Company’s licensed

by the Insurance Regulatory and Development Authority (‘IRDA’) for carrying life

insurance business in India.

It is a premier financial powerhouse and prudential plc, a leading international financial

services group headquartered in the United Kingdom (UK). The company brings together

the local market expertise and financial strength of ICICI Bank and Prudential’s

International life insurance experience. The company was granted a certificate of

Registration by the IRDA on November 24, 2000 and eighteen days later, issued its first

policy on December 12. 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).

From its early days, ICICI Prudential seemed to have the wherewithal for a large-scale

business. By March 31, 2002, a little over a year since its launch, the company had issued

100,000 policies translating into premium income of approximately Rs. 1,200 million on

a sum assured of over Rs.23 billion. When the company began its operations, the need

was to build a brand that was relatable to, symbolized trust and was easily recognized and

understood. It launched a corporate campaign ICICI Prudential also made using the

theme of ‘Sindoor’ to epitomize protection, trust, togetherness and all that is Indian;

endearing itself to the masses. The success of the campaign, ‘the calling card of the

company’ saw the brand awareness scores almost at par with its 40 year old competitor.

The theme of protection was also extended to subsequent product and category specific

campaigns –from child plans to retirement solutions –which highlight how the company

will be with its customers at every step of life.

From day one, the company has unflinchingly focused on being mass-market player,

developing products, creating a distribution network and deploying resources that would

27

further its goal. Apart from ramping up thoroughly training its advisors, the company has

twelve ‘Bancasurance’ partners –the largest in the country. It swiftly revised and added to

its initial range of products, pioneering market-linked products and pension plans, to offer

customers the most flexible life insurance policies in the country. In February 2004,

ICICI Prudential increased its capital base by Rs. 500 million, its ninth capital hike,

bringing the total paid –up equity capital to Rs. 6,750 million. With the authorized capital

of the company standing at Rs. 12 billion, ICICI Prudential continues to have the highest

capital base amongst all life insurers in the country. The challenge ICICI Prudential now

faces is to retain its top-notch position and continue to deliver the finest life insurance

and pension solutions to its ever-growing customer base.

ICICI Prudential’s equity base stands at Rs. 37.72 billion with ICICI Bank and Prudential

plc holding 74% and 26% stake respectively. For the year ended March 31, 2006, the

company garnered Rs.2, 412 crore of weighted new business premium and wrote 837,963

policies. The sum assured in force stands at Rs.45, 888 crore. The company has a

network of over 261,000 advisors; as well as 9 bancasurance partners and over 200

corporate agent and broker tie-ups. ICICI Prudential Branches can be found in almost all

the states and major cities of India.

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

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

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

to customers at the time of maturity or claims.

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

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

Indian customer at every step in life.

Beginning operations in December 2000, ICICI Prudential’s success has been meteoric,

becoming the number one private life insurer within months of launch. Today, it has one

of the largest distribution networks amongst private life insurers in India, with 1900

branches in addition to 1,074 micro-offices, over 261,000 advisors; and 7 banc assurance

partners in 54 cities. The total number of policies issued stands at more than 780,000 with

a total sum assured in excess of Rs.160 billion.

28

ICICI Prudential closed the financial year ended march 31, 2004 with a total received

premium income of Rs. 9.9 billion; up 135% last years total premium income of Rs.4.20

billion. New business premium income shows a 106% growth at Rs. 7.5 billion, driven

mainly by the company’s range of unique unit-linked policies and pension plans. The

company’s retail market share amongst private companies stood at 36%, making it clear

leader in the segment. To add to its achievements, in the year 2003/04 it was adjudged

Most Trusted Private Life Insurer (Economic Times ‘Most Trusted Brand Survey’ by AC

Nielsen ORG-MARG). It was also conferred the ‘Outlook Money-Best Life Insurer’

award for the second year running. The company is also proud to have won Silver at

EFFIES 2003 for its ‘Retire from work, not life’ campaign. Notably, ICICI Prudential

was also short-listed to the final round for its ‘Sindoor campaign in EFFIES 2002.

ICICI Prudential’s success is rooted in its philosophy to always offer the customer a

choice. This has been the driving force behind its multi-channel distribution strategy,

which includes advisors, banks, direct marketing and corporate agents. In fact, ICICI

Prudential was the first life insurer to invest in multiple channels and offer the customer

choice and access; thus reducing dependency on any one channel, great strides in the

retirement solutions and pensions market.

The Company’s penetration of the retirement market was driven by the focused approach

towards creating awareness through sustained campaign; ‘Retire from work, not life’.

Within six months, the campaign rewarded ICICI Prudential with an increased share of

23% of the total pensions market and 78% amongst private players. ICICI Prudential has

one of the largest distribution networks amongst private life insurers in India, having

commenced operations in 132 cities and towns in India, stretching from Bhuj in the west

to Guwahati in the east, and Jammu in the north to Trivandrum in the south.

The company has 9 bank partnerships for distribution, having agreements with ICICI

Bank, Bank of India, Federal Bank, South Indian Bank, Lord Krishna Bank, and some

co-operative banks, as well as over 200 corporate agents and brokers, it has also tied up

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

29

ICICI Prudential has recruited and trained more than 261,000 insurance advisors to

interface with and advise customers. Further, it leverages its state-of-the-art IT

infrastructure to provide superior quality of service to customers.

2.1 Mission of ICICI Prudential

ICICI Prudential Life is all about……

To provide total protection of Health Wealth, Life

Covering you at every step in Life.

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

values -- Integrity, Customer First, Boundary less, Ownership and Passion. Each of

the values describes what the company stands for, the qualities of people and the way

they work.

Company believes that it is on the threshold of an exciting new opportunity, where it can

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

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

2.2 The VISION of ICICI Prudential

“To make the company the dominant Life and Pensions player built on trust by world-

Class people and service .”

The company proposes to achieve its vision by:

• Understanding the needs of the customers and offering them superior products and

services.

30

• Leveraging technology to service customers quickly, efficiently and conveniently.

• Developing and implementing superior risk management and investment strategies to

offer sustainable and stable returns to the policy holders.

• Providing and enabling environment to foster growth and learning for the employees.

• Building transparency in all dealings.

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

Customer First, Boundary less, Ownership, and Passion. These values shine forth in

all they do, and have become the keystones of company’s success.

2.3 The ICICI Prudential Edge

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

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

into what makes us leaders.

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

customers' needs. It is this research that helps us develop Education plans that offer the

ideal way to truly guarantee your child's education, Retirement solutions that are a hedge

against inflation and yet promise a fixed income after you retire, or Health insurance that

arms you with the funds you might need to recover from a dreaded disease.

31

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

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

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

banks, corporate agents and brokers to distribute our products.

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

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

smooth and hassle-free claims process.

4. Entrusted with helping our customers meet their long-term goals, we adopt an

investment philosophy that aims to achieve risk adjusted returns over the long-term.

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

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

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

2.4 Promoters

ICICI Bank The World Bank, Government of India and representatives of the private

sector founded ICICI in 1955 to encourage and assist industrial development and

investment in India. ICICI Bank is India’s 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.

It offers a wide range of banking products and financial services to corporate and retail

customers 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 Bank posted a net profit of

Rs.1637 Crore for the year ended March 31, 2004. ICICI Bank’s 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

32

Depositary Receipts (ADRs) are listed on the New York Stock Exchange (NYSE). The

Various segment of ICICI are

Figure 2.1: Segments of ICICI

2.5 Prudential Plc.

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

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

than 16 million customers, policyholder and unit holders worldwide. As of June 30, 2004,

the company had over US$300 billion in funds under management. Prudential has

brought to market an integrated range of financial services products that now includes life

assurance, pensions, mutual funds, banking, investment management and general

insurance. In Asia, Prudential is the leading European life insurance company with a vast

network of 24 life and mutual fund operations in twelve countries - China, Hong Kong,

India, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand

and Vietnam.

The company has six Banc assurance tie-ups, having agreements with ICICI Bank,

Federal Bank, South Indian Bank, Bank of India, Lord Krishna Bank and some co-

operative banks, as well as over 150 corporate agents and brokers. It has also tied up with

NGOs, MFIs and corporates for the distribution of rural policies and organizations like

33

Dhan for distribution of Salaam Zindagi, a policy for the socially and economically

underprivileged sections of society.

ICICI Prudential has recruited and trained about 2,14,000 insurance advisors to

interface with and advise customers. Further, it leverages its state-of-the-art IT

infrastructure to provide superior quality of service to customers.

2.6 Corporate Social Responsibilities

CICI-Prudential Life Insurance Company Limited (ICICI Prudential), the joint venture

(JV) between ICICI Limited (NYSE: IC), and Prudential plc. of UK, today achieved the

landmark of issuing its first set of life insurance policies. This is amongst the first

insurance policies issued in India by a new private sector insurance company, after the

insurance sector was recently opened for private participation. Fittingly, the first set of 7

endowment policies, sponsored by IndiaInfoline.com, were handed over to economically

underprivileged children.

At a ceremony at ICICI's headquarters in Mumbai, children chosen from municipal

schools received endowment policies worth Rs.20,000 each from Ms. Shikha Sharma,

Managing Director, ICICI Prudential. Along with the policies, the children were also

presented book coupons worth Rs.1000/- and a box of chocolates.

"Distribution of first set of policies to underprivileged children marks our commitment to

function as a responsible corporate citizen and offer world class life insurance products to

Indian customers", said Ms Shikha Sharma.

The seven recipients of the policies, including four girls, are in the age group of 7-8 years

and will receive the money when they attain the age of eighteen years. Pratham, a Non

Government Organisation (NGO) is currently supporting the children's education.

India Infoline.com, India's leading finance portal and proposed marketing partner for

ICICI Prudential, sponsored these policies for the children. Speaking at the occasion, Mr

Nirmal Jain, Managing Director, IndiaInfoline.com said, " We are happy to be associated

with ICICI Prudential as their marketing partner. We are confident that our extensive

34

reach in the virtual and physical world will serve as an ideal platform for reaching

potential customers and building up the ICICI Prudential brand."

• Ensuring that all the CSR projects are properly conceptualised, designed and

implemented including proposal development.

• Maintaining a continuous dialogue with the relevant teams within each ICICI Group

companies, partner organization and the implementing NGOs who will be involved in

these CSR Projects.

• Ensuring that there is good engagement with all the stakeholders (employees, investors,

senior management, general public, regulators) of the ICICI Group of companies in these

initiatives.

• Complete responsibility for documentation and preparation of all internal and external

communication materials relating to these projects such as website, governing council

reports and presentations and annual reports.

• Leveraging the activities/projects through use of new media (Intranets, You Tube,

Facebook, Twitter, etc.) in an effective way particularly in the area of stakeholder

engagement with the project and in building ICICI Foundation brand salience.

2.7 Products

Insurance Solutions for Individuals

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

that meet the needs of customers at every life stage. Its 27 products can be 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.

35

• 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 Bank is an anticipated endowment policy ideal for meeting milestone expenses like

a child’s marriage, expenses for a child’s higher education or purchase of an asset.

• Lifetime & Lifetime II offer customers the flexibility and control to customize the policy

to meet the changing needs at different life stages. Each offer 4 fund options- Preserver,

Protector, Balancer and Maxi miser.

• Life Link II is a single premium Market Linked Insurance Plan which combines life

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

• Premier Life is a limited premium paying plan that offers customers life insurance cover

till the age of 75.

• Invest Shield Life is a Market Linked plan that provides capital guarantee on the invested

premiums and declared bonus interest.

• Invest Shield Cash is a Market Linked plan that provides capital guarantee on the

invested premiums and declared bonus interest along with flexible liquidity options.

• Invest Shield Gold is a Market Linked plan that provides capital guarantee on the

invested premiums and declared bonus interest along with limited premium payment

terms.

➢ Protection Solutions

• Lifeguard is a protection plan, which offers life cover at very low cost. It is available in 3

options- level term assurance, level term assurance with return of premium and single

premium.

➢ Child Plans

• Smart Kid education plans provide guaranteed educational benefits to a child along

with life insurance cover for the parent who purchases the policy. The policy is designed

36

to provide money at important milestones in the child’s life. Smart Kid plans are also

available in unit-linked form- both single premium and regular premium.

➢ Retirement Solutions

• Forever Life is a retirement product targeted at individuals in their 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 II is a regular premium market-linked pension plan

• Life Link Pension II is a single premium market-linked pension plan.

• Invest Shield Pension is a regular premium pension plan with a capital guarantee on the

investible premium and declared bonuses.

• 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.

• ICICI Pru Group Gratuity Plan: ICICI Pru’s group gratuity plan helps employers fund

their statutory gratuity obligation in a scientific manner. The plan can also be customized

to structure schemes that can provide benefits beyond the statutory obligations.

• ICICI Pru Group Superannuation Plan: ICICI Pru offers a 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

a partial commutation of the annuity at the time of retirement.

• ICICI Pru Group Term Plan: ICICI Pru’s flexible group term solution helps provide

affordable cover to members of a group. The cover could be uniform or based on

designation/rank or a multiple of salary. The benefit under the policy is paid to the

beneficiary nominated by the member on his/her death.

37

Flexible Rider Options

ICICI Pru Life offers flexible riders, which can be added to the basic policy at a marginal

cost, depending on the specific needs of the customer.

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

term of the policy, the beneficiary receives an additional amount equal to the 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 under the rider on death due to

accident.

• Critical Illness Benefit: protects the insured against financial loss in the event of 9

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

to death.

• Major Surgical Assistance Benefit: provides financial support in the event of medical

emergencies, ensuring benefits are payable to the life assured for medical expenses

incurred for surgical procedures. Cover is offered against 43 surgical procedures.

• 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 Smart Kid,

Secure Plus and Cash Plus

38

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

premiums are waived till maturity. This rider is available with Secure Plus and Cash Plus.

➢ Key man Insurance Plans

A keyman is an individual who directly affects the profitability and the continuity of a

business and whose absence may have an adverse effect on the health and continuity of

the business. Keyman insurance is a life insurance policy taken by the company on the

life of such a key person.

The objective of the Keyman insurance is to provide the company with money so that the

financial losses to the company can be protected, in absence of the Keyman. The aim is to

indemnify the company of these losses and to allow business continuity.

All premiums paid for securing a Keyman life insurance policy are treated as business

expenditure u/s 37 (1).

➢ Rural Plans

ICICI PruLife Rural Products are designed to meet the needs of the rural consumers.

These products offer the following features:

1. Low and Affordable Premiums

2. Life Cover

3. Savings Option

4. Hassle free procedure.

2.8 Mutual Funds

A Mutual Fund is a trust that pools the savings of a number of investors who share a

common financial goal. The money thus collected is then invested in capital market

instruments such as shares, debentures and other securities. The income earned through

these investments and the capital appreciations realized are shared by its unit holders in

proportion to the number of units owned by them

39

2.9 ICICI Pru Pinnacle

ICICI Pru Pinnacle is a unit linked insurance policy that offers the advantage of varying

exposure to equities along with downside protection, so that your investments are

protected in financially volatile times. It also offers a limited premium payment term

while allowing you to enjoy insurance protection for a longer period.

Guaranteed NAV

With ICICI Pru Pinnacle, we guarantee the highest Net Asset Value (NAV) recorded on a

daily basis, in the first 7 years of the fund, subject to a minimum of Rs.10. The guarantee

will be applicable only at maturity. The period of 7 years starts from the date of launch of

Pinnacle Fund and will end on the completion of 7 years (from 24/10/09 to 24/10/16).

Premium Payment

Term

3 years

Minimum Premium

Rs.50,000 per annum

Modes of Premium Half yearly/Yearly

40

PaymentMinimum/Maximum

Entry Age

8/ 65 years

Policy Term

10 years

Maximum Maturity

Age

75 years

Minimum Sum Assured

5 x Annual Premium

Tax Benefit Premium and any benefit amount received under

this policy will be eligible for the tax benefit as

per the prevailing Income Tax laws.

2.9 Types of Insurance Plan

(ULIP vs. Traditional)

Broadly, insurance plans can be distinctly divided into ULIP (Unit Linked Insurance

Plans) and traditional plans. A brief detail of both segments:

ULIPs (Unit Linked Insurance Plans)

ULIPs, or Unit Linked Insurance Plans, have gained high acceptance due to the

attractive features they offer. Benefits include flexibility, Transparency, Liquidity, and

Fund Options.

Flexibility

A ULIP offers the customer an acute degree of flexibility: the flexibility to choose the

Sum Assured, and to choose the desired premium amount. ULIPs give the customer the

option of changing the level of Premium/Sum Assured even after the plan has started,

and the flexibility to change asset allocation by switching between funds with ease.

41

Transparency

ULIPS offer a high degree of transparency, where all charges in the plan as well as the

entire net amount invested is made known to the customer. ULIPs also offer the

convenience of tracking your investment performance on a day to day basis, so you can

decide instantly where you want your assets allocated.

Liquidity

A ULIP offers you the option of withdrawing money a few years into the plan, allowing

for the exigencies of life. Alternatively, a ULIP will also allow for partial/systematic

withdrawal should the need arise.

Fund Options

A ULIP will offer you a wide choice of funds, ranging through equity, debt, cash, or a

combination of the three. The customer is also afforded the option of choosing your fund

mix based on your desired asset allocation.

Traditional Plans

These are the oldest types of insurance plans available. These plans cater to customers

with a low risk appetite. Some of the common features of traditional plans are:

1. Steady Investment

1. Major chunk of investible funds are in debt instruments.

2. Steady and almost assured returns over the long term.

2. Features

42

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

2. Helps in asset creation as they are for a long tenure.

3. Premium to Sum Assured ratios are fixed for each plan and age.

4. Generally withdrawals are not allowed before maturity.

43

2.10 Awards

India's Most Customer Responsive Insurance Company. AGC Networks - Economic

Times, Customer Responsiveness Awards, 2010.

The International Council of Customer Service Organizations (ICCSO) recently

awarded ICICI Prudential Life the International Service Excellence Awards 2009 in

the categories of Customer Charter – Winner, Service Excellence in Large Business –

44

Highly Commended and Customer Service Leader awarded to Ms. Priya Nayak, VP-

Service Quality.

ICICI Prudential Life Insurance has won the first runner up award for the Best Defect

Elimination in Service & Transaction category at Asian Six Sigma Excellence Summit

2009.

45

ICICI Pru Life ranked as the Most Trusted Pvt Life Insurance brand in the Brand

Equity "Most Trusted Brands 2009" survey

ICICI Prudential Life won a Gold award for AboutULIPS.com and Health Saver

campaign,innovation award for www.taxguru08-09.com and a silver award for its

Insurance yoga campaign at the ICICI Group Marketing Excellence award.

46

Confederation of Indian Industry (CII) - Western Region recently awarded ICICI

Prudential Life a 'Commendation for Strong Commitment to HR Excellence 2008' at

the CII HR Summit 2008.

ICICI Prudential Life Insurance was awarded with the coveted 'ICAI Award for

Excellence in Financial Reporting' by the Institute of Chartered Accountants of India

(ICAI) for the financial year ended March 31, 2008.

47

ICICI Prudential Life was awarded the Life Insurance Company of the Year at the12th

Asia Insurance Industry Awards 2008.

ICICI Prudential Life was awarded with two Bronze Effie's in the sevices catgeory for

its Corporate campaign and Retirement Number campaign

48

ICICI Prudential Life Insurance won the award for the Best Life Insurer-Runner up at

the Outlook Money & NDTV Profit Awards 2008

ICICI Prudential Life was awarded the SAP ACE 2008 Best Business Objects Award

for its IT practices

ICICI Prudential Life won the Award for Brand Excellence in the Banking and

Financial services category at the Asia Brand Congress 2008

49

ICICI Prudential Life won the UK Trade & Investment India Business Awards 2008

in the Business Partnership Award-Large Company category

ICICI Prudential Life won the ICICI Group Marketing Excellence Award 2008 in

three key categories for its marketing initiatives

50

ICICI Prudential Life was awarded the INDY’s Award for Excellence in Mass

Communication in the category of Most Creative Advertisement-Television

India's Most Customer Responsive Insurance Company . Avaya Global Connect -

Economic Times. Customer Responsiveness Awards, 2007

51

ICICI Prudential Life Insurance won the award for the Best Life Insurer-Runner up at

the Outlook Money & NDTV Profit Awards 2007

2.11 Competitors

Life Insurance corporation of India

The Life Insurance Corporation of India (LIC): भारतीय जीवन बीमा िनगम) is the largest

state-owned life insurance company in India, and also the country's largest investor. It is

fully owned by the Government of India. It also funds close to 24.6% of the Indian

Government's expenses. It has assets estimated of 9.31 trillion (US$ 202.03 billion).[1] It

was founded in 1956.

Headquartered in Mumbai, which is considered the financial capital of India, the Life

Insurance Corporation of India currently has 8 zonal Offices and 101 divisional offices

located in different parts of India, at least 2048 branches located in different cities and

towns of India along with satellite Offices attached to about some 50 Branches, and has a

network of around 1.2 million agents for soliciting life insurance business from the

public.

52

2.11.a Bajaj Allianz General Insurance Company Limited

Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj

Finserv Limited (recently demerged from Bajaj Auto Limited) and Allianz SE. Both

enjoy a reputation of expertise, stability and strength. Bajaj Allianz General Insurance

received the Insurance Regulatory and Development Authority (IRDA) certificate of

Registration on 2nd May, 2001 to conduct General Insurance business (including Health

Insurance business) in India. The Company has an authorized and paid up capital of Rs

110 crores. Bajaj Finserv Limited holds 74% and the remaining 26% is held by Allianz,

SE.

2.11.b Birla Sun Life Insurance

Established in 2000, Birla Sun Life Insurance Company Limited (BSLI) is a joint venture

between the Aditya Birla Group, a well known and trusted name globally amongst Indian

conglomerates and Sun Life Financial Inc, leading international financial services

organization from Canada. The local knowledge of the Aditya Birla Group combined

with the domain expertise of Sun Life Financial Inc., offers a formidable protection for its

customers’ future.

2.11.c HDFC Standard Life,

one of India’s leading private life insurance companies, offers a range of individual and

group insurance solutions. It is a joint venture between Housing Development Finance

Corporation Limited (HDFC), India’s leading housing finance institution and Standard

Life plc, the leading provider of financial services in the United Kingdom.

2.11.d ING Vysya Life Insurance.

53

ING Vysya Life Insurance (ING Life), a part of the ING Group the world’s largest

financial services corporation* entered the private life insurance industry in India in

September 2001. Headquartered at Bangalore, ING Life India is staffed by over 6,000

employees and services more than 10 lakhs customers.

2.11.e Met Life Insurance.

MetLife, Inc. is a leading provider of insurance and other financial services to millions of

individual and institutional customers throughout the United States.

Outside the U.S., MetLife companies have direct insurance operations in Asia Pacific,

Latin America and Europe.

2.11.f Oriental Insurance.

The Oriental Insurance Company Ltd was incorporated at Bombay on 12th September

1947. The Company was a wholly owned subsidiary of the Oriental Government Security

Life Assurance Company Ltd and was formed to carry out General Insurance business.

The Company was a subsidiary of Life Insurance Corporation of India from 1956 to 1973

( till the General Insurance Business was nationalized in the country). In 2003 all shares

of our company held by the General Insurance Corporation of India has been transferred

to Central Government.

2.11.g Tata AIG Life Insurance

Tata AIG General Insurance Company Ltd. is a joint venture between Tata Sons and

American International Group, Inc. (AIG). The Tata Group is holding 74 per cent stake

and the rest 26 percent is held by AIG. The company has got the expertise, knowledge

and strength of both the organizations.

54

2.11.h Aviva Life Insurance

Aviva India is a joint venture between one of the country’s oldest and largest groups,

Dabur, and Aviva plc, the UK's largest insurance group, whose association with India

dates back to 1834.

55

CHAPTER 3

ORGANIZATION STRUCTURE

56

ORGANIZATION STRUCTURE

Board of Directors

The responsibility for good governance rests on the Corporate Board which has the

primary duty of ensuring that the principles Of Corporate Governance, both as imbibed in

law and regulations and those expected by stakeholders, are religiously and voluntarily

complied with and the stake holder’s interests are kept at utmost high level.

The ICICI Prudential Life Insurance Company Limited Board comprises reputed people

from the finance industry both from India and abroad.

NAME DESIGNATION

Mr. K.V. Kamath, Chairperson

Mr. Chandan Kocher Director

Mr. Barry Stowe Director

Mr. Adrian O’Connor Director

Mr. Keki Dadiseth Independent Director

Prof. Marti G. Subrahmanyam Independent Director

Ms. Rama Bijapurkar

Mr. Vinod Kumar Dhall

Mr. N. S. Kannan,

Mr. Bhargav Dasgupta,

57

Management Team

The ICICI Prudential Life Insurance Company Limited Management team comprises

reputed people from the finance industry both from India and abroad.

NAME Designation

Ms. Shikha Sharma, Managing Director & CEO

Mr. N. S. Kannan, Executive Director

Mr. Sandeep Batra, CFO & Company Secretary

Ms. Anita Pai, Chief-IT, Customer Service & Operations

Mr. Azim Mithani, Chief Actuary

Mr. Puneet Nanda, Chief Investments Officer

Mr. Binayak Dutta, Chief – Sales and distribution

58

Hierarchical Structure of ICICI Prudential

59

CHAPTER 4

FUNCTION OF DEPARTMENTS

60

CEO

HeadOf

MKT

HeadOf

Finance

HeadOf

H R

Headof

Sales

Headof

CRM

Zonal Mgr

Agency Mgr

Branch Mgr

Unit Mgr

Advisers

FUNCTION OF DEPARTMENTS

There are three main departments:-

➢ Marketing

➢ Finance

➢ Human Resources.

4.1 Marketing

The Marketing function at ICICI Pru covers an array of activities - brand and media

management, channel support, direct marketing and corporate communications. The

Brand and Communications team is in charge of advertising, consumer research, media

planning & buying and Public Relations; that helps develop and nurture ICICI

Prudential's corporate identity while effectively communicating its varied product

offerings to the customer. Channel marketing provides support to the sales force by

streamlining the design and development of collaterals and sales tools across distribution

channels. The Direct marketing team was set up to generate high quality leads for

profitable business. The team achieves this through target database acquisition and

communicating customized product information through e-mailers, telemarketing and

innovative direct mailers.

61

Hierarchy of Marketing Department Structure at corporate level

Marketing Research

Marketing Research is the systematic method of gathering recording objective search and

analyzing of vaild and reliable information relating to the marketing of goods and

services. Several factors contributed to the growth of marketing research, Those are to

know the potential areas of selling for the manufacture where his goods could be

marketed

4.2 Finance

62

Head of Department

Manager Marketing

Assistant Manager

Marketing Officer

Assistant Marketing Officer

Marketing Executives

Junior Marketing Executives

Finance function in ICICI Prudential is committed to create an infrastructure that is

aligned to shareholder expectations. Finance basically comprises of four functions. .

Corporate Planning and MIS provide feedback on business strategies. This includes

driving the budgeting process, providing strategic inputs for decision-making and

management reporting and analysis. The Accounts function includes preparation and

maintenance of financial records, funds management, and expense processing and

treasury operations. Compliance ensures that every action is within the regulatory

framework. This includes reviewing compliance requirements and supporting the ethical

framework of ICICI Pru life. Internal audit provides assurance to the management over

the organizations' control framework and includes process risk management, information

security assessment and business continuity assessment.

Hierarchy of Finance Department Structure at corporate level .

4.3 Human Resource

The people strategy of ICICI Prudential is “To build a committed team with a culture of

innovation, learning and growth. The Human Resource Function at ICICI Prudential

63

Head of Department

Manager (Finance)

Assistant Manager

Junior superintendent

Senior Assistant

Junior Assistant

drives the people strategy of the business. With its initial focus on operational excellence

to deliver benefits and services to staff members, HR is now committed to building

capability through state of the art processes. A robust performance management system,

compensation system and a segmented training architecture enable it to deliver value to

the organization.

Hierarchy of Marketing Department Structure at corporate level .

The important function performed by the department are

• Induction and Orientation

• Training

• Performance Appraisal

• Promotion

• Recruitments

• Welfare Measure

64

Head of Department

Manager (HR)

Assistant Manager

Junior superintendent

Senior Assistant

Junior Assistant

Staff

Recruitment

ICICI Prudential committed to maintaining a balance between external recruitment and

offering development oppurtunities to its existing staff. Recruitment and selection

processes will be applied in a consistent, professional and timely manner.

A decision to recruit shall be made in the context of the current and future workforce

requirements of the organization ,approved staff members available financial resources

and relevant workforce planning strategies within the functional groups. The organization

looks at professionally qualified and experienced people who can drive the organization

to achieve its vision.

Induction

The Human Resource Department conducts the induction program. They prepare a

detailed induction schedule for the new colleagues joining the organization based on their

position .They undergo a detailed briefing about organization ,its policies and its

functions.

Training and Development

After employees have been selected for various positions in an organization, training

them for the specific tasks to which they have been assigned assumes great importance. It

is true in many organizations that before an employee is fitted into a harmonious working

relationship with other employees, he is given adequate training. Training is the act of

increasing the knowledge and skills of an employee for performing a particular job. The

major outcome of training is learning. A trainee learns new habits, refined skills and

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useful knowledge during the training that helps him improve performance. Training

enables an employee to do his present job more efficiently and prepare himself for a

higher-level job. The essential features of training may be stated thus:

• Increases knowledge and skills for doing a particular job; it bridges the gap

between job needs and employee skills, knowledge and behaviors

• Focuses attention on the current job; it is job specific and addresses particular

performance deficits or problems

• Concentrates on individual employees; changing what employees know, how

they work, their attitudes toward their work or their interactions with their co-

workers or supervisors

• Tends to be more narrowly focused and oriented toward short-term performance

concerns

Promotion

Promotions are of two types i.e. Seniority based promotion and performance based

promotion. Middle level employees are promoted on the basis of their seniority

and top level employees are promoted on the basis of performance

4.4 Customer Service and Operations

The Operations department oils the work processes between the customer and the

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 underwriters, 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 center, Outbound Call Centre, Customer Care and Query

Resolution Unit are all committed to providing effective solutions to over lakhs of

customers across the country.

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4.5 Information Technology

The Information Technology function at ICICI Prudential is committed to enable

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 offerings to end-users, the Solutions Group- Web that provides

real-time information to customers and is responsible for customer relationship

management, IT Architecture & 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 organization. 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 deployment of business application.

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Chapter-5

SWOT ANALYSIS

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SWOT ANALYSIS

Strengths:

1. Money power, which makes them about the gestation period.

2. Brand image, Business experience, and Innovative products.

3. The agents are very selectively chosen have excellent communication skills

4. Service quality, which is the crux of their mission.

5. Large network branches which is helped to customers for the payment.

6. Market segmentation and products for niche markets.

Weaknesses:

1. High targets for financial advisors and the sales departments.

2. Many competitors in the market offer same product by the title difference in the

premium and offerings.

3. Sustainable to risk associated with investments in money market.

4. Try to catch middle – lower level people also.

Opportunities:

1. Increasing purchasing power of large number of middle class.

2. India’s stature as leading IT power.

3. Retail finance and insurance sector

4. Infrastructure development.

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Threats:

1. Players like Bajaj and Birla Sun Life with the low premium for the similar plans.

2. Entry of many other companies with equally strong experience and financial

strength of foreign partners making the competition difficult and saturating the

urban markets.

3. Current Govt. policies do not encourage gross domestic savings. If the tax

liability of the service class rises the customer will have little money to invest.

4. LIC has woken up from sleep and is following competitive strategies. Its huge

surplus in Life Fund gives a capability to lodger price war.

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Chapter-6

SPECIAL TASK

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Special Task

The company takes proper care so that the confidential management related information

is not leaked out to public. During my internship period in the company I found that the

Branch manager is handling two branches at a time which are situated in different

locations and he visits once in a week and the staff is also not regular. There is lack of

motivations & accountability for the staff as well as for the Insurance advisers.

I also found that the people are not much aware about the products offered by the

company because there is no proper way of advertising. I found that the documentation

procedure is lengthy which consumes lot of time.

Impact

All these things are having very negative impacts on the profitability and goodwill of the

company. Some important ones are as follows:

• The employees feel deserted in absence of the boss.

• Bosses always motivate and influence subordinates, when the boss himself

doesn’t report regularly subordinates also feel doing the same.

• Irregularities lead to piling up of work and when work is not done on time the

clients get disappointed as they also suffer loss because of ICICI.

• The clients can switch to other companies if not properly taken care of.

• Low information on the part of employees about the products means the low

information to prospects & customers which simply means loss of market to

competitors.

• Without proper advertisement no one comes to know about the new products of

the company.

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Solution

• Proper discipline policies need to be formulated.

• Proper care should be taken of customers so that the market is not lost to

competitors.

• Employees should be motivated and retained so that the re-recruiting cost is

saved.

• Employees should be made aware of each and every aspect of new products so

that they could pass the information to prospects and more strong customer base

is gained.

• New marketing strategies need to be adopted.

• Proper training and development programs should be initiated.

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Chapter-7

FINDINGS, SUGGESSIONS & CONCLUSION

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Findings

• ICICI Prudential is having the good brand image in the market as compare to other

insurance companies.

• Almost all of the customers have an insurance policy.

• Due to increasing concern of people towards their health/life the life insurance

business has good impact.

• ICICI Prudential’s Life Time, Retirement solutions and Smart Kid’s are the most

preferred polices among all types of policies of the company.

• Most of the customers who hold ICICI prudential’s life insurance policy would

prefer to go in for another policy only from ICICI Prudential. The reason being

their brand image, wide variants or policies to choose from & good servicing of

policies

• Customers mainly go for Life risk cover by buying Life insurance policy which

provide benefits of income tax rebate.

• ICICI is the largest private player in the insurance industry in India .It has sold

over two lakh policies till date. Besides LIC, ICICI Prudential is facing stiff

competition from other private insurance players

• Targets given to the employees are very high as well as for their agents.

• Minimum policy is of Rs 10000 per year which is not affordable by the rural

people and lower income group.

.

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Suggestion

• As the targets are very high the employee are too much stressed and their

work efficiency decreases. Therefore they should be given less target as

compared to existing status.

• Minimum policy is of Rs 10000 per year which is not affordable by the rural

people and lower income group. Therefore to increase the number of

customer they should lower the minimum policy amount.

• Identifying means of a delightful customer experience.

• Documentation should be easy.

• Most of the time people are not aware of the new products & services

provide by the ICICI Prudential. So to create awareness, they should

increase their advertisement through various print & electronic media even

in rural areas.

• Staff is not motivated enough to work efficiently. They should provide

proper training to employees which can increase the motivational level so

that the employees would work more efficiently and provide better result in

achieving their targets.

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CONCLUSION

It was a good experience to work in such a reputed company. Lot of information was

provided to me regarding the working of the ICICI Prudential which helped me in

increasing my knowledge about the working of the different departments, their product &

services and their Customer Relationship Management.

The external guide who is the unit manager in the ICICI Prudential gave me all the

information needed for the organizational study. While working under him I got the

experience of field work.

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BLIOGRAPHY

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Bibliography:

BOOKS REFERED

• Marketing Management by Philip Kotler

• ICICI Prudential Company magazines

• Newspaper and Business magazines

WEBSITES

• www.iciciprulife.com

• www.google.co.in/indian insurance industry

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