A Project Report on Insurance as an investment tool with regards to ULIP at ICICI LTD

Insurance as an investment tool with regards to ULIP at ICICI LTD

EXECUTIVE SUMMARY As the people are becoming more and more and aware of their Life Style and Income level. They need a plan, which has an optimum balance between their Investment and Savings. They require an integrated financial plan for investment.

The customer requires those investment options, which provide them with flexibility and Liquidity and tax benefit.

Among the various other investment options, Insurance has gained a prominent place .It provides the policyholder with the benefit of Life Protection and at the same time allows him to take the benefit of the fluctuations of the share market.

Thus Life Insurance has taken a very vital position as a wholesome investment option.

Life Insurance is gaining public awareness and interest very rapidly. It was till now been thought as a way to insure lives, But, recently it is emerging as a prominent Investment avenue.

It has come up as a wholesome Investment avenue & provides the benefit of flexibility, Liquidity and Life protection. Along with added benefits like the rider attachments which protect the policyholder from various kinds of diseases and accident etc.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Scope of the study: •

The study will bring out the what people prefer investing in the insurance and how they divide there income for investing in different source of investment.

•

The study will bring out the extent of awareness of ULIP.

•

The study will help to know the working environment of the organization in the field.

Limitation of the study: •

As this study is academic in nature, it suffer from time and cost constraints.

•

As data was collected through personal survey, it suffer from reverse bias.

•

Respondent were asked to recall from their memory. Hence there are chance of recall bias.

•

The behavior of personnel might have changed under the condition of observation.

•

There might have been tendencies among the respondent to amplify of their responses under testing condition.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Company profile As finance is the lifeblood for all economic activities, one aspect of financial arena, which plays a very important role, is the Insurance.

Insurance is the outcome of Man’s search for safety and security, and to find out ways and means to minimize the hardship, which are beyond his control. Because of the economic reforms introduced by our government we can see that due to this Globalization and privatization there is enormous increase in the private sector players queuing in the insurance sector. This entry of Private players has enhanced the competitiveness and Quality of service with many innovated products.

Now in India there are totally 28 players including 14 Life and 14 General Insurance Companies. And Life Insurance is one of the most common forms of insurance.

ICICI Prudential Life Insurance is a joint venture between the ICICI Group and Prudential plc, of the UK. ICICI started off its operations in 1955 with providing finance for industrial development, and since then it has diversified into housing finance, consumer finance, mutual funds to being a Virtual Universal Bank and its latest venture Life Insurance .ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, which is one of India's foremost financial services companies, and Prudential plc, which is a leading international financial services group headquartered in the United Kingdom. ICICI Prudential began the operations in December 2000. Today, this company has over 2100 branches, which include 1,116 micro-offices, over 290,000 advisors and 18 banc assurance partners. ICICI Prudential Life Insurance Company is the first life insurer in India that received a National Insurer Financial Strength rating of AAA (Ind) from Fitch ratings. ICICI Prudential has been voted as India's Most Trusted Private Life Insurer for three consecutive years. ICICI Prudential Life Insurance Company has various insurance plans that have been designed for different individuals, as every individual has different insurance needs.

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Insurance as an investment tool with regards to ULIP at ICICI LTD ICICI Prudential Life Insurance Company Limited was incorporated on July 20, 2000.The authorized capital of the company is Rs.2300 Million and the paid up capital is Rs. 1500 Million. The Company is a joint venture of ICICI (74%) and Prudential plc UK (26%).The Company was granted Certificate of Registration for carrying out Life Insurance business, by the Insurance Regulatory and Development Authority on November 24, 2000. It commenced commercial operations on December 19, 2000,becoming one of the first few private sector players to enter the liberalized arena.

The Company is now operational in Mumbai, New Delhi, Pune, Chennai, KolkataBangalore, Chandigarh, Ahmedabad, Hyderabad, Lucknow, Nasik, Jaipur, Cochin, Meerut, Mangalore and Ludhiana.The Company recognizes that the driving force for gaining sustainable competitive advantage in this business is superior customer experience and investment behind the brand. The Company aims to achieve this by striving to provide world class service levels through constant innovation in products, distribution channels and technology based delivery.

Prudential PLC Prudential plc was founded in 1848. Since then it has grown to become one of the largest providers of a wide range of savings products for the individual including life insurance, pensions, annuities, unit trusts and personal banking. It has a presence in over 15 countries, and caters to the financial needs of over 10 million customers. It manages assets of over US$ 259 billion (Rupees 11,39,600 crores approx.) as of December 31, 1999. Prudential plc. has had its presence in Asia for the past 75 years catering to over 1 million customers across 11 Asian countries.

Prudential is the largest life insurance company in the United Kingdom (Source : S&P's UK Life Financial Digest, 1998). Asia has always been an important region for Prudential and it has had a presence in Asia for over 75 years. In fact Prudential's first overseas operation was in India, way back in 1923 to establish Life and General Branch agencies. Development of superior products and services that offer value for money and security while producing superior financial returns, enables Prudential to maximise the value of its shareholder's investment and to establish lasting relationships with customers and policy holders.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Brief Review of Scenario – Insurance Insurance was nationalized mainly on 3 counts First, Indian lives were not insured.

Second, even if they were insured, they were treated as substandard lives and extra premium was charged. Third, there were gross irregularities in the functioning of Life insurance was nationalized in the year 1956, and then general insurance was nationalized in the year 1972. In 1999, the private insurance companies were allowed back again into insurance sector with maximum cap of 26 percent foreign holding.  1818 The British introduce to India, with the establishment of the Oriental Life Insurance company in Calcutta.  1850 Non life insurance debuts, with Triton Insurance Company.  1870 Bombay Mutual life Assurance Society is the first Indian-owned life insurer  1907 Indian mercantile Insurance is the first Indian non-life insurer.  1912 The Indian life assurance companies’ act enacted to regulate the life insurance business.  1938 The insurance act, which forms the basis for most current insurance laws, replaces earlier act.  1956 Life insurance nationalized, government takes over 245 Indian and foreign insurers and provident societies.  1956 Government sets up LIC  1972 Non life insurance nationalized, GIC set up.  1993 Malhotra committee, headed by former RBI governor R.N.Malhotra, set up to draw up a blue print for insurance sector reforms.  1994 malhotra Committee recommends re-entry of private players, autonomy ot PSU insurers.  1997 Insurance regulator IRDA (Insurance Regulatory and Development Authority) set up.  2000 IRDA starts giving licensed to private insurers  2001 ICICI Prudential Life Insurance came into the market to sell a policy.

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Insurance as an investment tool with regards to ULIP at ICICI LTD  2002 Banks were allowed to sell insurance plans, as TPAs enter the scene, insurers start settling non-life claims in the cashless mode.

Contractual Definition: According to E.W.Patterson, “Insurance is a contract by which one party, for a consideration called a premium, assures a particular risk of other party ad promises to pay to him or his nominee a certain or ascertainable sum of money on a specified.

According to the U.S Life Office Management Association Inc (LOMA), Life Insurance is defined as follows: Life insurance provides a sum of money if the person who is insured dies whilst the policy is in effect.

Vision:  Understanding the needs of customers and offering them superior products and service  Building long lasting relationships with their partners  Providing an enabling environment to foster growth and learning for their employees.  Leveraging technology to service customers quickly, efficiently and conveniently

Values:  Customer First: Own Customer; deliver the promise  Keep customer interest in the centre of all decisions.  Promise what you can, deliver it to finish.  Proactively seek Voice of Customer and act on it

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Sponsors ICICI Ltd was established in 1955 by the World Bank, the Government of India and the Indian Industry, to promote industrial development of India by providing project and corporate finance to Indian industry. Since inception, ICICI has grown from a development bank to a financial conglomerate and has become one of the largest public financial institutions in India. ICICI has financed all major sectors of the economy, covering 6,848 companies and 16,851 projects. In the fiscal year 2000-2001, ICICI had disbursed a total of Rs 319.65 billion. ICICI has now developed a whole range of activities to become a Universal Bank. Some of ICICI's spectrum of activities include:  Commercial

Banking

-

ICICI

Bank,

India's

first

internet

bank.

 Information Technology - ICICI InfoTech, transaction processing, software development  Investment Banking - ICICI Securities, one of the key players in the Indian Capital Markets  Mutual Fund - Prudential ICICI AMC, leading private sector mutual fund player in India  Venture Capital - ICICI Venture, leading private equity investor with focus on IT and HealthCare  Retail Services - ICICI PFS, Marketing and Distribution of Retail Asset Products

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Other terms used in relation to insurance and their meaning:

Agent: The authorized representative of the insurer, licensed by the concerned authorities like IRDA to canvass insurance.

Bonus: The yearly share of policy holders profit declared by the company based on its profits which gets added to the policy amount and is payable upon its maturity.

Claim: The amount entitled to the policy holder or his nominee/assignee under a policy contract in the event of the happening of the contingency insured against.

Insurable Interest: Evidence suggesting financial losses due to the occurrence of the event insured against.

Policy: The evidence of contract between the insurer and the insured. A stamped sealed and signed document issued by the insurer to the insured in proof of insuring his life.

Premium: The amount mentioned in the policy contract to be paid by the insurer periodically to the insure to keep the policy in full force.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Area of Operation 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.

ICICI Prudential has recruited and trained more than 72,000 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.

Achievements 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 branches 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.

ICICI Prudential closed the financial year ended march 31, 2004 with a total received premium income of Rs. 9.9 billion; up 135%. New business premium income shows a 106% growth at Rs. 7.5 billion, driven mainly by the company’s range of unique unitlinked 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 ACNeilsen ORG-MARG). It was also

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Insurance as an investment tool with regards to ULIP at ICICI LTD 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.

In Keeping with its belief that a happy customer is the best endorsement, ICICI Prudential has embraced the ‘SIX SIGMA’ approach to quality, an exercise that begins and ends with the customer from capturing his voice to measuring and responding to his experiences. This initiative is currently helping the company improve processes, turnaround times and customer satisfaction levels. Another Novel introduction is the ICICI Prudential Lifestyle Rewards Club, India’s first rewards programmed for Life Advisors; it allows ICICI Prudential Advisors to redeem points for items ranging from kitchenware to gold, white goods, and even international holidays.

Promotion ICICI Prudential is a case study in how advertising and marketing can play a vital role in re-shaping an industry. It has demonstrated how an industry where the customer was nothing more than a policy number has changed to one where ‘customer preference’ rules the roost.

Brand-building in a complex category like life insurance is an uphill and multi-faceted task. At the time of launching operations, the communications task was to build credibility, so as to give the customer the confidence that it was ‘a company that could be trusted to invest funds with’. The aim was to encourage people to view insurance not as a compulsory tax saving instrument, but as a means to lead a worry-free, secure life and in the process, create the differentiator for brand ICICI Prudential.

The brand proposition for all the campaigns was reflected in the line: ‘Suraksha: Zindagi ke har kadam par’. The campaign featured a significant competitive advantage, the sound financial backing and credentials of ICICI Prudential, and showcased products from different segments. The advertising idea was encapsulated in the symbol of protection – the ‘Sindoor’. This campaign contributed extensively to raising brand awareness and creating a distinctive identity for the company.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Board of Directors The ICICI produentional Life Insurance Company Limited Board Comprises reputed people from the finance industry both from India and abroad.

Mr.Chanda D.Kochhar,

Chairperson

Mr. N.S. Kannan,

Director

Mr. K.Ramkumar,

Director

Mr. Barry Stowe,

Director

Mr. Adrisan O’Connor,

Director

Mr. Keki Dadiseth,

Independent

Director

Prof. Marti G. Subranhmanyam,

Independent

Director

Ms. Rama Bijapurkar,

Independent

Director

Mr. Vinod Kumar Dhall,

Independent

Director

Mr. V. Vaidyanathan,

Managing Director and CEO

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Management Team Mr. V. Vaidyanathan,

:

Managing Director and CEO

Ms. Anita Pai,

:

Executive Vice president – Customer service, Techonology and Marketing

Dr. Avijit Chatteriee,

:

Appointed Actuarcy

Mr. Puneet Nanda,

:

Executive Vice President

Contribution to Indian Economy  Life Insurance is the only sector which garners long term savings.  Spread of financial services in rural areas and amongst socially less privileged.  Long term funds for infrastructure.  Strong positive correlation between development of capital markets and insurance/pension structure.  Employment generation.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Stages in Insurance policy 1) Proposal : A Proposal Stage is the First stage before the policy is issued at COPS. At this stage, the application form is received by COPS, but it is pending for issuance due to further clarifications required from the customer.

2) Login : A proposal which is complete i.e., duly filled with all necessary documents attached to it & accepted by the Branch ops, is called a Login 3) Reject: An Application gets rejected at the Branch Ops level due to necessary details not filled in the form or necessary documents not submitted is a Reject. It is then sent back to the Advisor for completion.

4) Issuance :Issuance means a policy that is issued to the Customer by Central Ops. 5) Decline Status : When a customer refuses to take a policy post login but before Issuance is called a Decline 6) Cancellation : When the cheque given by the customer bounces, it amounts to cancellation of the policy.

7) Lapse: A policy for which the Customer fails to pay subsequent premiums is a Lapsed Policy.

8) Freelook : Post issuance of the policy, the policy holder has the option to turn down the policy within 15 days from the date of issuance. This period of 15 days is called Freelook Period.

9) Surrender: When a customer wants to discontinue with the policy.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Insurance in Indian Financial System In India insurance is in practice since 12th century as per the records. The first life insurance company to operate in India the Oriental Life Insurance company was established in 1818 in Calcutta. However it was a British company. The first Indian Insurance company, the Bombay Mutual Life Assurance Society started its operation in 1871. The Indian Life Insurance company Act was passed in 1928.Subsequently, both of these Acts were merged and the insurance Act 1938 was promulgated.

The story of non-life insurance in India is no different. Though Lloyd’s insurance pioneered the general Insurance way back in 1688, the first non-life Insurance Company to set up shop in India was the Triton Insurance company of Calcutta. In 1907 the first Indian general insurer the Indian Mercantile insurance company started its operations.

The New India Assurance Company Limited was incorporated in 1919. After independence the India Reinsurance Corporation was set up in 1956 and in 1957 the office of the controller of the insurance was constituted. In 1968, that tariff advisory committee was set up to regulate the investment of the players and finally in 1972, the non-life insurance business in the country was nationalized and the general insurance company was formed as holding company with four subsidiaries, the National Insurance, Oriental Insurance, United India Insurance and the new India Assurance Company Limited. In the same year the National Insurance Company Limited was amalgamated with 22 foreign and 11 Indian Insurance companies. Thus over a period of two centuries, the Indian insurance industry has gone through the full circle. From being an open competitive market, it went through nationalization and has been subsequently liberalized again. Keeping in mind the national economic and commercial objective of India the government has set up IRDA on 7th December 1999. Through which the reforms process of the industry got under way.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Insurance in Indian Financial System – Its Importance Insurance industry is one of the corner stone of any economy and financial System.

Insurance industry contributes its major part in increasing the saving and the fund collected is utilized in developmental program.

The Financial sector in our country is in the process of change with the objective o the overall growth of the economy. The insurance sector

as every one knows,

constitutes a very important and vital financial intermediary for the growth of the economy.

Insurance has become part and parcel of the financial system because it: •

Reduces the uncertainty of business loses.

•

Increases business efficiency.

•

Identifies key men.

•

Enhances the credit.

•

Takes care of welfare of the society.

•

Protect the wealth of the nation.

•

Helps to attain economic growth.

•

Reduces the inflation level.

It is said “Every rupee invested in insurance contributes thrice the amount in the economic development.

The Life Insurance: Life Insurance is one of the most common forms of insurance. It has acquired top position all over the world.“Life insurance is a contract fare by the insured promised to pay a uniform rate premium of fixed intervals of time against which the insurer agrees to pay a fixed amount on the happening of the event which may be the death of the insured on the expiry of certain number of years”.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Advantages of Life Insurance  Life insurance is brought not because someone is going to die, but because someone is going to live.  Life insurance means peace of mind.  Life insurance promises payment of the full sum assured from the moment the first premium is paid.  Life insurance encourages regular savings and guards against extravagances.  In most cases life insurance possesses a cash value after the first three years.  Life insurance removes the worry of looking after your savings. Experts safely and profitably invest your money on your behalf by experts.  Life insurance guarantees payment in cash and is backed by the Government of India.  Life insurance is a tax saving product.  Life insurance is free from loss, from theft, fire, misplacement etc.  A life insurance contract is one sided, i.e., always in favour of the insured and his family. One can withdraw from the contract anytime, but the company’s cannot.

Life insurance replaces uncertainty with certainty. It provide a complete, balanced and perfect hedge against economic threats, which confront all person, the danger of living too long or the danger of dying soon.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

How Insurance Works Suppose there are 1000 person all aged 35 years and healthy lives. They are insured for one year against the risk of death. Each person is insured for Rs. 50,000. if the past experience indicates the 4 out of 1000 people die during the year, expected amount claimed to be paid to the family of 4 persons would come to Rs. 2,00,000. the contribution to be paid by the each of the 1000 will come to Rs.200 per year. Thus, all the 1000 persons share loss caused to the 4 unfortunate families. 996 persons who survived till 1 year have not lost any thing as they have secured peace of mind and a feeling of security for their family. While insurance cannot prevent accident or premature death, it can help, protect the family of the deceased against the loss of income caused by the of the main breadwinner. In return for specified payments, insurance will provide protection against the insurance of an uncertain event such as premature death. The business of insurance company called insurer is to bring together persons who are exposed to similar risk, collect contribution (premium) from them on sum equitable basis and pay the losses (claim) to the unfortunate few who suffer.

NEED FOR THE INSURANCE: Unlike other avenues of savings where the amount saved with interest is payable only on maturity, insurance plans provide for payment of the total sum assured along with a bonus, if any, on any eventuality even before the maturity of the policy. And another advantage of insurance is that an insurer can avail loans against the security of the policy from the insurance company. Even banks and other financial institutions advances loans with insurance policies as a collateral security.

To provide for one’s family and perhaps; others in the event of death, especially premature death. Originally, policies were to provide for short period of time, covering temporary risky situations, such as sea voyages. As lie insurance became more established, it was realized what a useful tool it was for a number of situation, including

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Insurance as an investment tool with regards to ULIP at ICICI LTD

 Regular savings:Providing for one’s family and oneself, as a medium o long term exercise (through a series of regular payment of premiums). This has become more relevant in recent times as people seek financial independence from their family.  Investment:It is the insurance that builds up the savings of the society and thus safeguard the economy from the ravages of inflation. Unlike regular saving products, investment products are traditionally lump sum investments, where the individual makes one time payment. 

Retirement: Provisions for one’s own later years become increasingly necessary, especially in a changing cultural and social environment. One can buy a suitable insurance policy, which will provide periodical payments in one’s old age.

Insurance Market in India The term “insurance market” is used to denote the means available for the placing of insurance and the various organizations that are willing to accept risks. It comprises of the demand side i.e., the buyers and the supply side i.e. sellers and the intermediaries.

The rational behind the opening up to the sector was to five individual and corporate insurance consumers a competitive environment that can deliver products and service in tune to their requirements. At the same time and open insurance market will enable capital formation. Reducing the need for India to seek external capital to support its infrastructure of development program. The industry is believed to benefit from any increased private participation especially in terms of technology from other global players as these players enter into joint ventures with India counterparts. The partnership between Indian and foreign firms will also enable the market to grow beyond the currents rates and will offer wider choice for the consumer through the introduction of new products, service and price option. New players are aggressive

in their marketing

campaigns and the challenging LIC, virtually in all aspects.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Why should you take insurance Insurance is desired to safeguard oneself and ones family against possible losses on account of risk and perils. It provides financial compensation for the losses suffered due to the happening of unforeseen events. By taking life insurance a person can have peace of mind and need not worry about the financial consequences in case of any untimely death.

Along with the growth of overall population in the country, crossing the benchmark of hundred crore, there gas been a significant awareness for the need for insurance in the other as well as rural segments and even among the lower middle class and illiterate class of the population.

We in India have around 30 crore middle class educated and enlightened people who have not realized that insurance is as necessary as the other basic necessities of life such as food, shelter, clothing.

There are two kinds of insurance as given below:1. Life Insurance: Human lives are insured under life insurance. A Life Insurance is a combination of savings as well as security element. The insured is assured that the insurance company will pay his family the insured amount in the case of premature death. Is he is alive and the policy matures for payment, the savings so made will be helpful in his old age. Only the Life Insurance Corporation of India transacts life insurance business in India.

2. General Insurance: All insurance other than Life Insurance fall under General Insurance. Only the general insurance corporation of India transacts General Insurance business in India.

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Insurance as an investment tool with regards to ULIP at ICICI LTD The following are different types of general insurance:  Marine Insurance:The marine insurance is the oldest form of insurance and covers all the marine perils. Due to marine perils, the ship can be damaged or destroyed, cargo can be lost and consequently there can be lost of freight. Therefore, the marine insurance covers the risk to ship, cargo, and freight on the high seas.  Fire Insurance: The fire insurance covers the risk of fire to property because there is every likelihood of fire spreading in big factories, go-downs, ware housing, house shops and ships. The fire insurance not only covers the risk of fire, but also the consequential losses from such fire.

Insurance products •

Education Insurance Plans

 Smart Kid New Unit-linked  Regular Premium  Smart Kid New Unit-linked  Single Premium  Smart Kid Regular Premium •

Wealth creation plan

 Wealth Advantage  Life Stage Assure  Life Time Gold  Life Link Super  Life Stage RP

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Insurance as an investment tool with regards to ULIP at ICICI LTD

•

Premium guarantee plan

 Invest Shield Life New  Invest Shield Cash Bank

•

Protection plan

 Pure Protect  Life Guard  Save 'n' Protect  Cash Back  Home Assure •

Retirement plan

 Life Stage Pension  Life Time Super Pension  Life Link Super Pension  Forever Life Plan  Immediate Annuity •

Health coverage plan

 Health Saver  Medi Assure  Hospital Care  Crisis Cover  Cancer Care  Diabetes Care Active  Diabetes Assure Babasabpatilfreepptmba.com

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Insurance as an investment tool with regards to ULIP at ICICI LTD

•

ICICI pru group solution plan

 Group Super Annuation  Group Gratuity Plan  Annuity Solutions  Group Term Insurance Plan  Group Term Insurance in lieu of EDLI  ICICI Pru Suraksha  ICICI Pru Suraksha Kavach •

Micro insurance plan

 ICICI Pru Sarv Jana Plan

Organization chart

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Insurance as an investment tool with regards to ULIP at ICICI LTD

CEO

Senior Voice President

Voice President

ZM Manager

Regional Manager

Associate Regional Manager

Area Manager/Sales Manager

Sourcing structure

Unit Manager

Senior Agency Manager

Agency Manager

Business Manager

Senior business Manager

Different department in ICICI life insurance Ltd Babasabpatilfreepptmba.com

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Insurance as an investment tool with regards to ULIP at ICICI LTD Tied Agency Tied Agency is the largest distribution channel of ICICI Prudential, comprising a large advisor force that targets various customer segments. The strength of tied agency lies in an aggressive strategy of expanding and procuring quality business. With focus on sales & people development, tied agency has emerged as a robust, predictable and sustainable business model.

Banc assurance and Alliances: ICICI Prudential was a pioneer in offering life insurance solutions through banks and alliances. Within a short span of two years, and with nearly a large number of partners, B & A has emerged as a vital component of the company’s sales and distribution strategy, contributing to approximately one third of company’s total business.

The business philosophy at B&A is to leverage distribution synergies with our partners and add value to its customers as well as the partners. Flexibility, adaptation and experimenting with new ideas are the hallmarks of this channel.

Customer Service and Operations: The operation department ensure consistent and quality service to the customer.This department provide full information about the insurance product to the customer and this department act as mediator between the clients and the agent. And smoothly Manage the work process in company.

The Vision at Customer Service is to deliver ‘World Class Service’ at every opportunity.

Units such as the 9 to 9 contact centre, Outbound Call Centre, Customer Care and Query Resolution Unit are all committed to providing effective solutions to over lakhs of customers across the country.

Information Technology:

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Insurance as an investment tool with regards to ULIP at ICICI LTD 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.

Marketing The marketing department play important role in the icici prudential life insurance company. The company adapt brand and media management, channel support, direct marketing and corporate communications to reach the customer. Advertising help the ICICI prudential to identity while effectively communicating its varied product offerings to the customer and channel marketing provide boost to the sale and help to build a strong distribution channel 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.

Human Resource

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Insurance as an investment tool with regards to ULIP at ICICI LTD 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 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.

Other private sector

S.N o.

Registrat Date of i on Reg. Number

Name of the Company

1

101

23.10.2000 HDFC Standard Life Insurance Company Ltd.

2

104

15.11.2000 Max New York Life Insurance Co. Ltd.

3

105

24.11.2000 ICICI Prudential Life Insurance Company Ltd.

4

107

10.01.2001 Kotak Mahindra Old Mutual Life Insurance Limited

5

109

31.01.2001 Birla Sun Life Insurance Company Ltd.

6

110

12.02.2001 Tata AIG Life Insurance Company Ltd.

7

111

30.03.2001 SBI Life Insurance Company Limited .

8

114

02.08.2001 ING Vysya Life Insurance Company Private Limited

9

116

03.08.2001 Bajaj Allianz Life Insurance Company Limited

10

117

06.08.2001 Metlife India Insurance Company Ltd.

11

133

04.09.2007 Future Generali India Life Insurance Company Limited

12

135

19.12.2007 IDBI Fortis Life Insurance Company Ltd.

General Insurers :

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Insurance as an investment tool with regards to ULIP at ICICI LTD S.No.

Registratio n Number

Date of Registratio n

Name of the Company

1

102

23.10.2000

Royal Sundaram Alliance Insurance Company Limited

2

103

23.10.2000

Reliance General Insurance Company Limited.

3

106

04.12.2000

IFFCO Tokio General Insurance Co. Ltd

4

108

22.01.2001

TATA AIG General Insurance Company Ltd.

5

113

02.05.2001

Bajaj Allianz General Insurance Company Limited

6

115

03.08.2001

ICICI Lombard General Insurance Company Limited.

7

131

03-08-2007

Apollo DKV Insurance Company Limited

8

132

04-09-2007

Future Generali India Insurance Company Limited

9

134

16-11-2007

Universal Sompo General Insurance Company Ltd.

Yr: 2001-2002 :

Life Insurance: Babasabpatilfreepptmba.com

Page 27

Insurance as an investment tool with regards to ULIP at ICICI LTD

S.No. Registration Date of Number Reg.

Name of the Company

1

121

03.01.2002 Reliance Life Insurance Company Limited.

2

122

14.05.2002 Aviva Life Insurance Co. India Pvt. Ltd.

General Insurance : S.No.

Registration Date of Number Registration

Name of the Company

1

123

15.07.2002

Cholamandalam General Insurance Company Ltd.

2.

124

27.08.2002

Export Credit Guarantee Corporation Ltd.

3.

125

27.08.2002

HDFC-Chubb General Insurance Co. Ltd.

Yr: 2003-2004 :

Life Insurers: S.No. Registration Date of Number Reg. 1

127

Name of the Company

06.02.2004 Sahara India Insurance Company Ltd.

Yr: 2004-2005 :

Life Insurance:

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Insurance as an investment tool with regards to ULIP at ICICI LTD S.No. Registration Date of Number Reg. 1

128

Name of the Company

17.11.2005 Shriram Life Insurance Company Ltd.

Yr: 2006-2007 :

Life Insurance: S.No. Registration Date of Number Reg. 1

130

Name of the Company

14.07.2006 Bharti AXA Life Insurance Company Ltd.

Yr: 2007-2008 :

S.No. Registration Date of Number Reg.

Name of the Company

1

133

04.09.2007 Future Generali India Life Insurance Company Limited

2

135

19.12.2007 IDBI Fortis Life Insurance Company Ltd.

Yr: 2008-2009 :

Life Insurers: S.No. Registration Date of Number Reg.

Name of the Company

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Insurance as an investment tool with regards to ULIP at ICICI LTD 1

136

08.05.2008 Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd.

2

138

27.06.2008 Aegon Religare Life Insurance Company Ltd.

3

140

27.06.2008 DLF Pramerica Life Insurance Company Ltd.

4

142

Star Union Dai-ichi Life Insurance Co. Ltd.,

General Insurance: S.No.

Registration Number

Date of Reg.

Name of the Company

1

139

27.06.2008

Bharti Axa General Insurance Company Ltd.

Awards and Achievements Innovation Award for launching Diabetes Care – Prudence Award 2006 People Award for excellence in training and people development Prudence Award 2006

India's Most Customer Responsive Insurance Company - Economic Times Customer Responsiveness Awards

Most Trusted Private Life Insurer: The Economic Times – A C Nielsen Survey of Most Trusted Brands – 2004

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Prudence Customer Centricity Award - 2004 & 2005: Prudential Corporation Asia

Best Life Insurer 2003: Outlook Money Awards 2003-04

IMM Award for Excellence: Institute of Marketing & Management

Organization with Innovative HR Practices: Indira Group of Institutes

Superbrand 2003-04

Organization with Innovative HR Practices: Asia-Pacific H R Congress Awards for HR Excellence

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Silver Effie for Effectiveness of the ‘Retire from Work not life’ advertising campaign: Effies 2003

Most Trusted Private Life Insurer: The Economic Times – A C Nielsen Survey of Most Trusted Brands – 2003

Best New Insurer: Outlook Money Awards 2003

Major Market Players: Presently there are 15 Life insurance companies in the country. There is only one public sector company LIC and the rest 14 are from private sector. Although LIC has been dominating the Life Insurance business since past few years the private players have now started to build up momentum.  HDFC – Standard Life: HDFC and Standard Life first came together for a possible joint venture, to enter the Life Insurance market, in January 1995. It was clear from the outset that both companies shared similar values and beliefs and strong relationship quickly formed.

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Insurance as an investment tool with regards to ULIP at ICICI LTD Products offered by the company: •

Endowment Assurance Plan

•

Money Back Plan

•

Group Insurance Plan

 Life Insurance Corporation of India (LIC): Life Insurance Corporation of India is a 100% government held Public Sector Company. Being the first to be established LIC is the forerunner in the Life Insurance sector. The market share for FY 2005-06 was 71.44%.  Bajaj Allianz Life Insurance Co Bajaj Allianz Life Insurance Co. Ltd. is a joint venture between two leading conglomerates-Bajaj Auto, one of the biggest 2 and 3 wheeler manufacturers in the world and Allianz AG, one of the world's largest insurance companies.

The following are the products offered by the company: •

Bajaj Allianz Group Gratuity Care

•

Bajaj Allianz Group Superannuation Care

•

Bajaj Allianz Group Credit Care Plan

•

Bajaj Allianz term Plan

•

Bajaj Allianz Risk Care Plan

•

Bajaj Allianz Life Time Care

•

Bajaj Allianz save Care

 The TATA AIG Group: TATA AIG group is a 74:26 JV between Tata Group and AIG. It belongs to the private sector. The company was registered on 12/2/2001. The market share for FY 2005-06 was 1.29%.  5) Max New York Life Insurance Company Ltd: Product Offered By the Company  Endowment policy 

Whole Life policy

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Insurance as an investment tool with regards to ULIP at ICICI LTD 

Term Insurance

 6) MetLife Insurance Company Ltd: The origin of Metropolitan Life Insurance Company (MetLife) was started in 1863.

But the company decided to focus on life insurance business in 1868. By 1880 the company was started to 700 new industrial policies a day. From 1909 MetLife became the nation’s largest life insurance in terms of insurance.

Products offered by the company  Term Insurance products 

One Year Term Insurance



Scheduled Term Insurance

 Permanent insurance products 

L-98 whole life



Equity Advantage VUL

 SBI Life Insurance Company Ltd: SBI Life Insurance Company is a 74:26 Joint venture between SBI and Cardiff S.A. The company was registered on 31/3/2001.It is a private sector company. The market share for FY 2005-06 was 2.31%.

 Sahara India Life Insurance Company Ltd: First Wholly Indian Owned Private Life Insurance Company. The Company commenced operations from 30th October 2004. The market share for FY 2005-06 was 0.06 %.

 6) MetLife Insurance Company Ltd: The origin of Metropolitan Life Insurance Company (MetLife) was started in 1863.

But the company decided to focus on life insurance business in 1868. By 1880 the

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Insurance as an investment tool with regards to ULIP at ICICI LTD company was started to 700 new industrial policies a day. From 1909 MetLife became the nation’s largest life insurance in terms of insurance.

Products offered by the company  Term Insurance products 

One Year Term Insurance



Scheduled Term Insurance

 Permanent insurance products 

L-98 whole life

 Kotak Mahindra Life insurance Company Ltd: Product offered by the company  Endowment assurance plan 

Money back policy



Term policy

The Insurance Regulatory and Development Authority (IRDA): Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies.

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Insurance as an investment tool with regards to ULIP at ICICI LTD The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies were the launch of the IRDA’s online service for issue and renewal of licenses to agents.

The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products, which are expected to be introduced by early next year.

Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 12 life insurance and 6 general insurance companies have been registered.

Mission ” To protect the interest of the policy holder to regulate, promote and ensure orderly growth of the insurance and for matter connected there with or incidental there to.”

Functioning of the IRDA  To exercise all the powers and functions of controller of insurance.  Protection of the interest of the policy holders.  To issue, renew, modify, withdraw or suspend certificate of registration.  To specify requisite qualification and training for insurance intermediaries and agents.

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Insurance as an investment tool with regards to ULIP at ICICI LTD  To promote and regulate professional organizations connected with insurance.  To conduct inspection/investigation etc.  To prescribe method of insurance accounting.  To regulate investment of funds and margins of solvency.  To adjudicate upon dispute.  To conduct inspection and audit of insurers intermediaries and other organization concerned with insurance.

Protection of the interest of policy holders: IRDA has the responsibility of protecting the interest of insurance policyholders.

Towards achieving this objective, the Authority has taken the following steps:  IRDA has notified Protection of Policyholders Interest Regulations 2001 to provide for: policy proposal documents in easily understandable language; claims procedure in both life and non-life; setting up of grievance redressal machinery; speedy settlement of claims; and policyholders' servicing. The Regulation also provides for payment of interest by insurers for the delay in settlement of claim.

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Insurance as an investment tool with regards to ULIP at ICICI LTD  The insurers are required to maintain solvency margins so that they are in a position to meet their obligations towards policyholders with regard to payment of claims.  It is obligatory on the part of the insurance companies to disclose clearly the benefits, terms and conditions under the policy. The advertisements issued by the insurers should not mislead the insuring public.  All insurers are required to set up proper grievance redress machinery in their head office and at their other offices.  The Authority takes up with the insurers any complaint received from the policyholders in connection with services provided by them under the insurance contract.

INSURANCE AS AN INVESTMENT TOOL WITH REGARDS TO ULIP

With the development of the insurance market, investors now have more choice. One option is unit linked insurance policies, which are slightly different from other policies.

Unit linked insurance products act like an insurance cover with the benefits of a mutual funds. Benefits are expressed in terms of number of units and units price. Customer can

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Insurance as an investment tool with regards to ULIP at ICICI LTD buy as many units through their premium as they wish. As in a mutual fund, the net asset value is known on a daily basis.

The product have a higher transparency in terms of returns. While the market link gets a policy-holder a better return

,the insurance aspect attached to each

unit gets the holder a tax exemption on premium paid up to 10,000 under Sec.80d.

Here, the virtues of asset allocation hold good too. If you want less risk, choose a debt plan. Liquid funds are generally less risky and growth funds, which allot substantial sums to equities, carry the highest risk reward ration.

Most insurance companies have turned out a good performance since 2002.

While debt funds recorded an average return of 8 percent equity funds earned a phenomenal 60 percent on returns.

Investors must understand that a unit linked plan work on a minimum premium basis and not on a sum assured one .like a mutual fund, one can fix an amount of contribution or a minimum premium .

In short, if you can choose

on the market and increase your investment, you can

maximise your return. On an average , the annual growth rate is pegged at 8 percent but this is not guaranteed .however cumulative bonuses, ranging from 13 to 15 percent annum, on an average is added to the sum assured for every claim free year.

Many plan allow a reduction in premium if it has been paid regularly for a certain period or the unit fund achieves a certain valuation. Your premium would depend on the age and term of the policy An investor has to pay some charges since the fund also involves management of assets. Apart from the regular charges for cancellation of units, risk cover and charges relate to policy specifics, these is a cost attached to fund management. Which is normally in the range of 0.8 percent of the fund value per annum. Also ,under ULIP.

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Insurance as an investment tool with regards to ULIP at ICICI LTD one will have to pay a certain amount for the cancellation of a policy before paying a regular premium for three years.

However, there is a benefits for holding on for three years one can withdrawals without any penalty. In the case of a fatality, the insured will receive the sum assured and then the maturity value.

To put in to simply, ULIP attempt to fulfill investment need of an investors with protection/insurance need of an insurance seeker. ULIPs work on the premise that there is class of investors who regularly invest their savings in products like fixed deposits, coupon-bearing bonds, debt fund, diversified equity fund and stock. There is a another class of individuals who take insurance to provide for their family in case of anevetuality. so typically both these categories of of individual have portfolio of investment as well as life insurance. ULIP as a product combines both these products( investment and life insurance) into single product. This save the investors/ insurance seeker the hassles of managing and tracking a portfolio of products. According to the IRDA, a company offering unit linked plan must give an option to choose among debt, balanced and equity funds.

Five step to selecting the right ULIP Unit linked insurance plan(ULIP) were seen s wonder product that simultaneously an individual’s need for investment and insurance. here are 5 step to select the right ULIP. 1) Understand the concept of ULIP: Try to do as much homework as possible before investing in an ULIP. This way you will kwon that you are getting into and won’t be faced with unpleasant surprises at later stage. Gather the information on ULIPs the various options available and understand

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Insurance as an investment tool with regards to ULIP at ICICI LTD their working. Read the literature available on ULIP on the websites and broachers circulated by insurance companies.

2) Focus on your requirement and risk profile Identify a plan that is best suitable for you(in terms of allocation of money between equity and debt instrument). Your risk appetite should play an important role in the plan you choose. So if have a high risk a appetite, go in for a more aggressive investment option.

3) Compare ULIPs of different insurance companies Compare products of the leading insurance companies. Enquire about the premium payments as ULIPs work on minimum premium basis as opposed to sum assured in the case of conventional insurance policies. Check the fund’s performance over the past six months. Find out how the debt and equity schemes are performing and how steady the performance has been. Enquire about the charges you will have to pay. In ULIPs the cost involved are a big deciding factor.

Ask about the top-up facility offered by ULIPs, additional lump sum investments you can make to increase the saving portion of your policy. The companies give you the option to increase the premium amount, there by providing you with the opportunity to gainfully utilise surplus funds at your disposal.

Enquire about the number of time you can make free switches(change the asset allocation of money in your ULIP account) from one investment plan to another. Some insurance companies offer you free switches for a2 year period while other do so only for 1 year.

4) Go for an experienced insurance advisor: Select an advisor who is not only professional and informed, but also independent and unbiased. Also enquire whether he has serviced client like you. When your agent recommends A ULIP of X Company ask him a few product related questions to test him and also ask him why the other products should not be considered.

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Insurance as an investment tool with regards to ULIP at ICICI LTD Insurance advice at all times must be unbiased and independent and your agent must be willing to inform you about the pros and cons of buying a particular plan. His job should not just being by filling the form and end after he deposits the cheque and give you the receipt. He should keep a track of your plan and inform you on a regular basis. The key is to go for an advisor who will offer you value added products 5) Dose your ULIP offer a minimum guarantee?

In market linked product if you investment’s downside can be protected, it would be a huge advantage. Find out if the ULIP you are considering offers a minimum guarantee and what cost have to be born for the same. This will enable you to make an informed choice.

BASICS OF UNIT LINKED INSURTANCE PLANS Basics of unit insurance Plans: A Policy which provides for life insurance where the policy value at any time varies according to the value of underlying assets at the time.

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Insurance as an investment tool with regards to ULIP at ICICI LTD Unit Linked Insurance Plans (ULIP) is life insurance solution that provides the client with the benefits of protection and flexibility in investment.

The investment is denoted as units and is represented by the value that it has attained called as Net Assets Value (NAV).

Unit Linked Insurance Policies

Units in Fund

Underlying

ULIP Came into play in the 1960s and became very popular in Western Europe and Americans. The reason that is attributed to the wide spread popularity of ULIP is because of the transparency and the flexibility which it offered to the clients.

In today’s times-ULIP provides solutions for all the needs of a client like insurance planning, financial needs, financial planning for children’s future and retirement planning.

An ULIP structures looks like as follows Contribution

Less Less charge Charges Investment Represented as units

Life covers

FEATURES OF UNIT LINKED PLAN ULIP distinguishes itself through the multiple benefits that it provides to the consumer.

The plan is a one stop solution providing.

1. Investment and savings

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Insurance as an investment tool with regards to ULIP at ICICI LTD 2. Life Protection 3. Flexibility a. Adjustable Life cover b. Investment Options 4. Transparency 5. Options to take additional cover against a. Death due to accident b. Disability c. Critical illness d. Surgeries 6. Liquidity 7. Tax planning Now let us see each of the above in detail.

1. Investment and savings: ULIP provides the client with the option of investing as per personal risk profile and get return accordingly. There are options of funds where in the client can put money in 1. Equity Markets 2. Debt Markets 3. balanced funds with a mix of the above two 4. Short-term debt market.

This also help the client in savings in accordance to the age as a younger person can afford to take some risk however a senior citizen might not be in a position to make investment in comparatively high risk instruments.

With the option of four funds to invest in the client always has the option to change shift as the risk and return orientation changes.

Subsequent contributions and contribution can also be allocates in different funds.

Net Asset Value

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Insurance as an investment tool with regards to ULIP at ICICI LTD

The investment is denoted as NAV-Net Asset Value.

Net Asset Value is defined as the total value of the assets in the underlying fund minus the expenses paid or to be paid divided by the number of units issued. The issue value of a unit is usually 10/-.

The Net Asset Value of a fund is the indicator of the value of the fund.

In traditional Plans the policyholder is not aware of the value the policy is accruing.

In a Unit Linked plan—the investment, which is denoted through a NAV, is the real time indicator of the value of the fund. Therefore a policyholder can easily find out that what is the value that the policy has accrued as of now.

The NAV is listed on a daily basis in all the national newspapers.

Example If 2, 00,000 - have been accumulated in the equity fund. And the number of units issued is 10,000/- then NAV of the equity fund is 2, 00,000/10,000=20/As the equity markets develop the fund grows from 2,00,000 to 2,20,000 Now the NAV is 2, 20,000/10,000=22/-. fund.

2. Life Protection: The life insurance needs keep changing through the life stage of an individual.

When we start working When we start a family When our children start a career When we retire This When mapped to life insurance needs gives us a graph: `

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Insurance as an investment tool with regards to ULIP at ICICI LTD Therefore as our responsibilities grow the need for life protection grows and when these responsibilities are successfully executed the needs reduces.

ULIP allows a client to change the varying life protection needs that makes it. •

Easier for the client to manage

•

Hassle free

•

Economically effective

The death benefit is usually a multiple of the contribution being paid which ensures that the contribution is adequate enough to provide life protection and savings.

In a ULIP the client usually pays yearly mortality charges, which makes it more cost effective for the clients.

The charges deducted each year as per the age client therefore at the age of 30, mortality for the age of 30 is charged and at the age of 31 mortality for age of 31 is charged.

3. Transparency: ULIP are completely transparent and the client knows as how every paisa being charges is allocated.

There are various kinds of expenses that are involved in any insurance plan. These expenses may be related to the sales and distribution cost, or the operational costs, the coasts related to the life insurance cover or the costs related to the management of

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Insurance as an investment tool with regards to ULIP at ICICI LTD expenses. Since all unit-linked plans have a transparent structure, they have to exhibit all the charges. It may be worthwhile to know about the various kind of expenses related to a unit-linked plan.

The various kinds of expenses are detailed below Contribution Related Charges These are charges that are represented as a percentage of the regular or single contribution paid. In case of regular contribution plan, it is usually high in the first year to pay for the distribution cost. This charge pays for the issuance and for distribution commissions.

This is a charge to cover the running expenses of the policy. For single contribution plans this is levied once at the start of the policy. For regular contribution plans this will be charged on a regular uniform basis depending upon the frequency of payments.

Normally these charges are shown as percentage of the contribution. Allocation is another terminolology used by the company in actually representing costs.

Allocations mathematically reverse of the charges. Thus mathematically; Allocation=1-Charges. Thus for example if a product has a 70% allocations in the first year, it means 1-.07=0.3% or 30% charge.

Administrative Charges: These are charge that are levied for the administration of the policy and the related costs of administration of the insurance company itself. These costs are different from the issuance and the distribution related costs of the product. They are more related to their costs like the IT, operational, etc cost of continuing the policy. There are few prominent ways in which these costs are levied.

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Insurance as an investment tool with regards to ULIP at ICICI LTD a) They can be levied as the percentage of the value of the investments (funds) in the account of the policyholder. So for example, as Bajaj Allianz levy a charge of 1.25% of the fund for the administration of the policy, every year. These kinds of charges get adjusted in the Unit Value (NAV), as the NAV is declared after adjusting these costs. b) They can be levied as flat charge with an option of increasing it by a certain percentage over years. For example Birla levies a flat charge of Rs 28 per month on its policy. HDFC SL unit linked plan levies Rs 180 annually as the administration charges.

Fund management fee: All unit linked plans have underlying funds, which the policyholders choose for their investments. These funds constitute of various financial instruments such as equity, bonds, and money market instruments.

These charges are expressed as a percentage of the Asset Under Management of the insurance company. So for example, Birla in its creator fund charges 1.25% annually of the AUM, HDFC charges 0.09% for its equity fund. Interesting thing to know here is the factor on which the charges depend the main factor being the fund composition.

For example, the cost of managing a bond is lesser than the cost of managing equity.

Thus normally, the fund option, which has a higher percentage of equity, would have higher charges comparatively to other funds.

Mortality charges: This covers the cost of providing life protection for the insured and may be once at the start of the policy or a recurrent manner (for example). This charges is levied to provide the insurance cover under the plan.

Normally these charges are 1-year charges and keep changing as per the age of the policyholder.

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Insurance as an investment tool with regards to ULIP at ICICI LTD These are the normally expressed as per thousand of the sum assured and depend on the age of the policy holder. For example one would have the mortality charges as Rs 1.50 per thousand for 30 years old and Rs 1.55 for the age of 35 years. This means that cost of insurance of Rs 1000 at the age of 30 is 1.50, where the same insurance cover cost Rs 1.55 at the age of 35 year Rider charges: Rider charges are similar in nature to the mortality charges as they are levied to pay for the other protection benefits that the policy holder has choose for critical illness benefits or accident benefits.

Surrender charges: When policy holder decides to surrender the policy or partially withdrawals some of the units for cash a surrender charges may be apply. Usually surrender charges apply only in the first few years after the units are invested and are usually on a decreasing scale.

Surrender by charges are used to cover the initial expenses that have been incurred by the company but not yet recovered by the policy holder These charges can either be expressed as a percentage of the value of the investment or as fixed flat charges, on the structure of the product.

Transaction Specific charges: These charges are levied when the client dose some specific transaction like changing funds, topping up the investment component or withdrawals.

4) Extra protection:

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Insurance as an investment tool with regards to ULIP at ICICI LTD Riders provide more protection to the policyholder and ULIP allows addition of rider, at nominal cost.

The common riders that are attachable are 1. Death due to accident 2. Disability 3. Critical illness 4. Surgeries 5) Liquidity: This facility makes the ULIP a very practical insurance in current time, most life insurance plan do not provide the policy holder the facility of withdrawals money in case the need arises.

Unit linked plan provide you easy access to your money as and when you may require.

One can redeem the units after a particular period of time as defined by the plan, as per the need .ULIP allow either partial or complete withdrawal, without penalizing the policyholder.

6) Tax Planning: Insurance is a very important of financial planning. It not only provides you and your family with a comforting sense of security but some plans like the term assurance plan can be easy on your pocket too

Working of a Unit Linked Plan A client puts in a regular contribution of Rs 20,000/-. From this amount a percentage is deducted as a contribution.

Therefore if the contribution related expenses is 20% - Rs 4,000 will be deducted as a contribution related charges.

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Insurance as an investment tool with regards to ULIP at ICICI LTD The amount that is now available is Rs 20,000– 4,000= 16,000/Now, if the client who is aged 30 years were to a life cover of 5,00,000/-, then mortality 91.50/- per thousand at the age of 30 charges of Rs 750/- will be deducted.

This amount will provide life cover to the policy holder. The remaing amount of Rs 15250/- will be invested in any of the underlying funds i,e debt, equity or mix of both the two. The client can invest in any one of them or all of them.

The investment as showed in terms of units. Thus if the client invested in debt fund and NAV of the debt fund is 16/- (Market Price) then the number units that the client is 15250 / 16 = 953.125 for this investment – fund management fee will be charged and for maintaining the policy and administrative charge is levied.

Flow Chart of a Unit linked plan

Less 20% 20,000-4000=16000

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Mortality & Rider Charges deucted Page 51

Insurance as an investment tool with regards to ULIP at ICICI LTD

Contribution

Contribution related charges deducted

16,000-750=15,250

Life Protection 500,000

for the age 30- mortality at 1.50 per thousand The client invests resultant in funds as chosen

15,250/- invested in debt fund

Investment in Funds Debt / Equity or balanced

at a NAV of 16/Units allocated

953.1250units allocated

Represented as NAV

NAV of debt fund 16/- per unit

First and foremost, investors need to understand that a ULIP is a bundled product of their investment of their investment and their insurance proceeds. So if you have a ULIP invested in equities, you are exposing your life insurances monies as well as your investable surplus to the vagaries of equity markets. While it is fine and even sensible to let your invest able assets get an equity flavors, the same cannot be said about your life insurance monies, which to a large extent should be sacred. The volatility in equity

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Insurance as an investment tool with regards to ULIP at ICICI LTD markets a can disturb the calmest of minds and the last thing you want to see is your nest egg being eroded by the latest slide in equity markets. Abhishek Bhatia elaborates, ‘A ULIP policyholder has the option to invest in a variety of funds, depending on his risk profile. If one does not have the appetite to invest in equity, they can choose a debt or balanced fund.’

However, the structure of a ULIP takes care of quite a bit of the uncertainty in the markets. Insurance companies understand the need to give insurance – seekers the flexibility to rethink their investment strategy in view of the market histrionics. There is an option for the insurance – seeker to switch to another plan with a lower or zero equity component to stem the loss in a falling equity market. The switch option allows customers to switch between fund options, thereby making adjustments to any perceived risks. ‘ICICI Pru allows policyholders to make this switch four times a year at no cost, with Rs 100 at every additional switch after that. However, for investors to make the right switch they need to track markets actively and well – informed, which is actually the job of the investment advisor/consultant. SO IF INSURANCE –SEEKERS / INVESTORS PLAY THEIR CARDS RIGHT, THEY CAN MAKE THIS MARRIAGE WORK.

Funds available in ICICI prudential

Plan Maximiser

Plan objective Risk High growth and capital High

Investment pattern Equity and equity related

(Growth)

appreciation over a long

securities: Max 90%, Debt,

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Insurance as an investment tool with regards to ULIP at ICICI LTD terms

money market and cash :

Balancer

Balance

Min 10% Equity and equity related

(balanced)

appreciation and study

securities: Max 40%, Debt,

returns over a long terms

money market and cash :

Equal balance of capital Low

Min 60% Debt instrument: Max 50%

appreciation and study

Money market and cash

Preserver

of

capital Average

Protector

returns over a long term Min 50% Study returns over a long Moderate Debt instrument: Max 100%

(Income)

term.

Money market and cash Max 25%

The various products under ULIPS that ICICI Pru offers

RETIREMENT SOLUTIONS Life expectancy has been rising rapidly and today, you can now expect to live much longer than your earlier generations. For you, this increase will mean a longer retirement life, stretching into couple of decades. So it is more critical than ever to plan adequately and wisely for those incremental retirement years, keeping in mind that your expenses will spiral upward, your cost of living will increase and inflation will be ever present. Therefore, you need a plan that ensures safety, risk cover income security and regular return for your post retirement year.

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Insurance as an investment tool with regards to ULIP at ICICI LTD ICICI prudential life insurance Retirement solution that combine the best of investment and insurance. The solution are developed to ensure your peace of mind for the year to come. Solutions that give you power to maintain your lifestyle need, for longer as you live.

Power you receive with retirement Solution  Power to choose retirement date  Power to increase your investments  Power to choose the protection level  Power to invest in a plan, based on your priority  Power to receive your pension

Life time pension: A regular premium Life time pension is the new age retirement solution. It is a solution that provides the policyholder with power to adapt as a life stage chance. It powers the policyholder to plan for retirement, investment and protection. The flexibility to plan for your retirement the way you want to is the crux of this plan.

The plan is a combination of Forever and life time. During the deferment period the plan operate like Life time; enable the policyholder to create the best investment as per personal risk and return profile. When policyholder desires to vest the plan, Life time pension operate just like Forever Life.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Tax Benefits Tax Benefits u/s 80CCC(1) up to Rs 10,000/- deducted from your taxable and heath rider have tax benefits under sec 80D.  Annuity once give is guaranteed and is taxable as per the current income tax rules.  Communication and death claim where in the sum assured or purchase price is paid, the amount is tax free.

Life Link Pension II A single premium plan This is the single premium market linked retirement solution. The plan combines the facility of Life link and Forever life. This is oriented towards senior people who have not planned for their retirement and would like to do so through a single premium. It is also targeted towards people that have received a lump sum payment or have a lump sum to invest, and would like to plan for their retirement with that money.

LIFE TIME PENSION II gives you the freedom to choose the amount of premium, and invest in market – linked funds, to generate potentially higher returns. On the future retirement date, the accumulated value of the units will be used to purchase an annuity – to provide you with regular income for life.

POWER TO CHOOSE THE PROTECTION LEVEL Choose from either a Zero sum assured or a sum assured, which will be equal to the product of your annual contribution and term.

POWER TO CHOOSE THE RETIREMENT DATE

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Insurance as an investment tool with regards to ULIP at ICICI LTD Take advantage of market movements by choosing a vesting age between 45 – 75 years of age.

POWER TO INCREASE YOUR INVESTMENTS Use your surplus funds to – up your investments during the deferment period.

POWER TO INVEST IN A PLAN BASED ON YOUR PRIORITIES Choose from among four funds, based on your investment objectives and risk appetite. If at a later stage your financial priorities change, you can switch between the various fund options, absolutely free, 4 times a year.

POWER TO INCREASE / DECREASE YOUR CONTRIBUTION Based on your requirements, increase or decrease your contribution.

TAX BENEFIT Tax benefit u/s 80CCC(1)...up to Rs 10,000/- deducted from your taxable income and health riders have tax benefit under sec 80 D. •

Annuity once given is guaranteed and annuity taxable as per current income tax rules.

•

Commutation and death claim wherein the sum assured or purchase price is paid, the amount is tax – free.

ICICI LIFE LINK PENSION II Life Link pension II gives you the freedom to choose the amount of premium, and invest in market – linked funds, to generate potentially higher returns. On a future retirement date, the accumulated value of the units will be used to purchase an annuity that will provide you with regular income for life.

POWER TO CHOOSE THE RETIREMENT DATE Choose a vesting age between 45 – 75 years of age.

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Insurance as an investment tool with regards to ULIP at ICICI LTD POWER TO INCREASE YOUR INVESTMENTS Use your surplus funds to top – up your investments during the deferment period.

POWER TO INVEST IN A PLAN BASED ON YOUR PRIORITES Choose from among four funds, based on your investment objective and risk appetite. If at a later stage your financial priorities change, you can switch between the various fund options, absolutely free, 4 times a year.

TAX BENEFIT Tax benefit u/s 80CCC (1)..... up to Rs 10,000/- deducted from your taxable income and health riders have tax benefit under sec 80 D. •

Annuity once given is guaranteed and annuity is taxable as per the current income tax rules.

•

Commutation and death claim wherein the sum assured or purchase price is paid, the amount is tax – free.

CHILD PLANS As a responsible parent, you will always strive to ensure a hassle – free, successful life for your child. However, life is full of uncertainties and even the best – laid plans can go wrong. Here’s how you can give your child a 1000% safe and assured tomorrow, whatever the uncertainties. Smart Kid is especially designed to provide flexibility and safeguard your child’s future education and lifestyle, taking all possibilities into accounts.

Choose from amongst a basket Of 3 Plans: 1) SMARTKID unit – linked regular premium 2) SMARTKID unit – linked regular premium II 3) SMARTKID unit – linked single premium II All these plans offer you:

FINANCIAL BENEFITS

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Insurance as an investment tool with regards to ULIP at ICICI LTD Regular payments at critical stages in your child’s life, like Board Examinations, graduation and post – graduation.

TOTAL PEACE OF MIND, EVEN IF YOU ARE NOT AROUND SUM ASSURED IS PAID IMMEDIATELY Ensures that your loved ones stay financially secure, even in your absence.

ALL FUTURE PREMIUMS ARE WAIVED Ensuring that your family is not financially burdened in your absence.

POLICY BENEFITS CONTINUE The educational benefits of policy continue, ensuring that your child can realize his or her dreams without any hassles.

DEVELOPMENT ALLOWANCE Smartkid quarantines regular income to secure your child’s education career and also ensure his or her all – round development, for a nominal additional amount. The income rider takes care of this through an annual payment of 10% of sum assured, to your child, till the maturity of the policy, in the unfortunate event of the death of the parent.

SAVING’S PLAN LIFE TIME & LIFE TIME II Presenting Life Time & Life Time II – unit – linked plans that meet your changing needs over a lifetime. These solutions have been developed to meet your savings, protection and investment needs at every stage in life.

PROTECTION * Choose specified level of protection (available only with Life Time). * Two levels of Sum Assured to choose from (available only with Life Time II).

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Insurance as an investment tool with regards to ULIP at ICICI LTD * Flexibility to increase or decrease your sum assured. * Add – on riders to protect you against any eventuality.

SAVINGS • •

Flexibility to increase or decrease your contribution.

Facility of Premium Holiday, wherein the policy continues even if there is temporary breaks in the payment of annual contribution (available only with Life Time).

•

Facility of Automatic cover Continuance, wherein the policy continues even if there is a temporary break in the payment of annual contribution (available only with Life Time II).

•

Facility to top – up your investment any time you have surplus funds.

•

Additional allocation of units on a periodic basis.

Objectives: 1) To know the factor that influence the investor while selecting the a ULIP. 2) To study customer awareness and preference towards the ULIP. 3) To study the performance of the ULIP. 4) To know the reason for dissatisfaction among the investor.

5) To know the investment pattern of the people in terms of savings.

Research Design

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Insurance as an investment tool with regards to ULIP at ICICI LTD Exploratory design: In this project we are using explorative research design which help to gain the back ground information about the ICICI prudential life insurance

Source of Data :  Primary Data  Secondary Data Primary Data • Observation •

Survey

•

Telephonic survey

Secondary Data •

Internet

•

Business magazines

Research Methodology We are using survey method to collect primary data. The followings are the details of our survey.

Sample: 100 people as a respondents for survey who may represent the population of Hubli city.

Sample Unit: Hubli Sampling frame: customer data base Sampling extent: Hubli city Sampling procedure: Descriptive sampling

Management problem

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Insurance as an investment tool with regards to ULIP at ICICI LTD

“Difficult to convince the customer�

Research problem Insurance as an investment tool with regards to ULIP

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Insurance as an investment tool with regards to ULIP at ICICI LTD

DATA ANALYSIS

Which of these are important while choosing the life insurance?

Valid

Frequency

Percent 21.0

Valid Percent 21.0

Cumulative Percent 21.0

Investment

21

Security

19

19.0

19.0

40.0

Saving

8

8.0

8.0

48.0

Tax benefits

16

16.0

16.0

64.0

Return

22

22.0

22.0

86.0

Financial future need

14

14.0

14.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD Total

100

100.0

100.0

Analysis: Out of 100 respondent 21% of respondent said that Investment is the important while choosing the insurance and 19% of respondent said that security is important and 8% of respondent said saving is important while choosing the life insurance.16% of respondent said Tax benefits is importent,22% and 14% of respondent are said that return and financial future need is important while choosing the life insurance.

Rank the following based on your priority?

Return Frequency

Percent

Valid Percent

Cumulative Percent

2

2.0

2.0

2.0

Return 1

1

1.0

1.0

3.0

Return2

5

5.0

5.0

8.0

Return 3

12

12.0

12.0

20.0

Return 4

35

35.0

35.0

55.0

Valid

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Insurance as an investment tool with regards to ULIP at ICICI LTD Return 5

45

45.0

45.0

Total

100

100.0

100.0

100.0

Return 50

40

30

Frequency

20

10

0 Return 1

Return2

Return 3

Return 4

Return 5

Return

Analysis: out of 100 respondent 45% of respondent are give more priority to the returns

Security Frequency

Percent

Valid Percent

Cumulative Percent

2

2.0

2.0

2.0

Security 1

12

12.0

12.0

14.0

Security 2

22

22.0

22.0

36.0

Valid

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Insurance as an investment tool with regards to ULIP at ICICI LTD Security 3

19

19.0

19.0

55.0

Security 4

19

19.0

19.0

74.0

Security 5

26

26.0

26.0

100.0

Total

100

100.0

100.0

Security 30

20

Frequency

10

0 Security 1

Security 2

Security 3

Security 4

Security 5

Security Analysis: Out of 100 respondent 26% of respondents are give more priority to the Security.

Service

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Insurance as an investment tool with regards to ULIP at ICICI LTD Frequency

Percent

Valid Percent

Cumulative Percent

2

2.0

2.0

2.0

Service 1

31

31.0

31.0

33.0

service 2

33

33.0

33.0

66.0

service 3

25

25.0

25.0

91.0

service 4

8

8.0

8.0

99.0

service 5

1

1.0

1.0

100.0

Total

100

100.0

100.0

Valid

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Service 40

30

Frequency

20

10

0 Service 1

service 2

service 3

service 4

service 5

Service

Analysis: Out of 100 respondents 33% of respondent are give Less priority to the service.

Premium Frequenc Percent y Valid

Valid Cumulati Percent ve Percent 2.0 2.0 57.0 59.0

2 57

2.0 57.0

premium 2

29

29.0

29.0

88.0

premium 3

10

10.0

10.0

98.0

premium 4

2

2.0

2.0

100.0

Total

100

100.0

100.0

premium 1

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Insurance as an investment tool with regards to ULIP at ICICI LTD

premium 70 60 50 40 30

Frequency

20 10 0 premium 1

premium 2

premium 3

premium 4

premium

Analysis: Out of 100 respondent 57% of respondent are give less priority to the premium amount.

Tax benefits Frequency Percent Valid Tax benefits 1 Tax benefits 2 Tax benefits 3 Tax benefits 4 Tax benefits 5 Total

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Valid Cumulative Percent Percent 2.0 2.0 1.0 3.0

2 1

2.0 1.0

11

11.0

11.0

14.0

31

31.0

31.0

45.0

28

28.0

28.0

73.0

27

27.0

27.0

100.0

100

100.0

100.0

Page 69

Insurance as an investment tool with regards to ULIP at ICICI LTD

tax benefits 40

30

Frequency

20

10

0 Tax benefits 1

Tax benef its 3

Tax benefits 2

Tax benef its 5

Tax benef its 4

tax benefits

Analysis: Out of 100 respondent 31% of respondent are give more priority to the tax benefits.

What Factor influence you to invest in the insurance plan?

Valid

Frequency

Percent

Valid Percent

Savings

49

49.0

49.0

Cumulative Percent 49.0

financial need

23

23.0

23.0

72.0

Tax benefits

27

27.0

27.0

99.0

Others

1

1.0

1.0

100.0

Total

100

100.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Analysis: In 100 respondent 49% of respondent are said that savings influence for invest in the insurance, and 23% of respondent are said future financial need influence for invest in the insurance. Out of 100 respondent 27% of respondent said that Tax benefits influence them for investing in the insurance and 1% of respondent said other factor influence them invest in the insurance.

Are you aware ULIP in ICICI prudential life insurance?

Valid

Frequency

Percent

Yes

80

No Total

Babasabpatilfreepptmba.com

80.0

Valid Percent 80.0

Cumulative Percent 80.0

20

20.0

20.0

100.0

100

100.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Analysis: Out of 100 respondent 80% of respondent are aware of ULIP in ICICI prudential, and 20% of respondent are unaware of ULIP in ICICI prudential.

Why prefer ULIP in ICICI prudential?

Valid

Frequency

Percent 38.8

Valid Percent 38.8

Cumulative Percent 38.8

Returns

31

Safety

17

21.3

21.3

60.0

Risk Cover

19

23.8

23.8

83.8

Tax benefits

13

16.3

16.3

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD Total

80

100.0

100.0

Analysis: Out of 80 respondent 39% of respondent said that they prefer ULIP for Return,21% of respondent prefer for Safety purpose. 24% and 16% of respondent said that they prefer ULIP for Risk cover and Tax benefits.

How did you come to know about the ULIP in ICICI prudential?

Valid

Frequency

Percent

Valid Percent

Cumulative Percent

Friends

18

22.5

22.5

22.5

Advertisement

23

28.8

28.8

51.3

Advisor

14

17.5

17.5

68.8

News paper

15

18.8

18.8

87.5

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Insurance as an investment tool with regards to ULIP at ICICI LTD Others

10

12.5

12.5

Total

80

100.0

100.0

100.0

Analysis: In 80 respondent 23% are know about the ULIP in ICICI through friends, 29% and 19% of respondent are know about ULIP through Advertisement and News paper and 12% of respondent are said that they know about the ULIP through other sources ,17% of respondent are know through advisors.

Are you satisfied with the performance of the ULIP in ICICI prudential?

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Valid

Frequency

Percent

Valid Percent

Cumulative Percent

Highly satisfied

33

41.3

41.3

41.3

Satisfied

38

47.5

47.5

88.8

Moderate

7

8.8

8.8

97.5

Dissatisfied

1

1.3

1.3

98.8

Highly Dissatisfied Total

1

1.3

1.3

100.0

80

100.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD Analysis: Out of 80 respondent 41% of respondent are said that the are Highly satisfied with the performance of the ULIP in the ICICI.48% are responded that they are satisfied with the ULIP in ICICI 9% are said moderate and 1% of respondent said dissatisfied with the ULIP performance and another 1% of respondent said highly dissatisfied with the ULIP in ICICI prudential.

In which insurance plan would like to invest in ICICI prudential?

Frequency Percent Valid

Valid Cumulativ Percent e Percent

Smart kid

34

42.5

42.5

42.5

Life time gold

16

20.0

20.0

62.5

Retirement Solution

30

37.5

37.5

100.0

Total

80

100.0

100.0

Analysis: In 80 respondent 42% of respondent are interested to invest in Smart kid for their children’s and 20% are interested in life time gold for higher return, 38% of respondent are interested to invest in retirement solution for future purpose.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Are you satisfied with the advisor service in ICICI prudential?

Valid

Frequency

Percent

Valid Percent

Cumulative Percent

Excellent

14

17.5

17.5

17.5

Good

18

22.5

22.5

40.0

Average

32

40.0

40.0

80.0

Bad

13

16.3

16.3

96.3

vast

3

3.8

3.8

100.0

Total

80

100.0

100.0

Analysis: In 80 respondent 18% of respondent are said that advisor service is excellent,23% are said good and 40% of respondent said advisor service is average. 16% and 3% of respondent are said bad and vast.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Satisfaction level towards ULIP in ICICI prudential?

Frequenc Percent y Valid

Valid Cumulativ Percent e Percent

Highly satisfied

19

23.8

23.8

23.8

Satisfied

38

47.5

47.5

71.3

Nether satisfied or Dissatisfied

18

22.5

22.5

93.8

Dissatisfied

4

5.0

5.0

98.8

Highly Dissatisfied

1

1.3

1.3

100.0

Total

80

100.0

100.0

Analysis: Out of 80 respondent 24% of respondent are highly satisfied with the ULIP in ICICI, 47% of respondent are satisfied with the ULIP in ICICI.23% of respondent are nether satisfied or dissatisfied with the ULIP, 5% are highly dissatisfied with the ULIP in the ICICI and 1% of respondent said highly dissatisfied with the ULIP in ICICI prudential.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Are you satisfied with the service provided by the ICICI prudential?

Frequency Percent Valid

Valid Percent

Cumulative Percent

Highly satisfied

16

20.0

20.0

20.0

Satisfied

9

11.3

11.3

31.3

Moderate

26

32.5

32.5

63.8

Dissatisfied

21

26.3

26.3

90.0

Highly Dissatisfied

8

10.0

10.0

100.0

Total

80

100.0

100.0

Analysis: Out of 80 respondent 20% of respondent are said that they are highly satisfied with the service provided by the ICICI prudential,11% of respondent are satisfied with the service of ICICI and 33% of respondent are moderate with the service of the ICICI. 26% and 10% of respondent are said they are dissatisfied and highly dissatisfied with the ICICI prudential service.

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Insurance as an investment tool with regards to ULIP at ICICI LTD

In future would like invest in?

Valid

Frequency

Percent 45.0

Valid Percent 45.0

Cumulative Percent 45.0

Insurance

45

Mutual fund

6

6.0

6.0

51.0

Equity

6

6.0

6.0

57.0

Share market Investing in gold Bank deposits Total

9

9.0

9.0

66.0

3

3.0

3.0

69.0

31

31.0

31.0

100.0

100

100.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Analysis: In 100 respondent 45% of respondent are said they invest money in future in insurance and 6% of respondent are interested invest in mutual fund, and another 6% of respondent are interested to invest in equity, 9%,3%,31% of respondent are interested to invest in share market, investing in gold and bank deposits.

What kind of investment you prefer?

Valid

Frequency

Percent

Valid Percent

Cumulative Percent

High risk, High return

20

20.0

20.0

20.0

Medium risk, Medium return

46

46.0

46.0

66.0

Low risk, low return

34

34.0

34.0

100.0

100

100.0

100.0

Total

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Analysis: Out of 100 respondent 20% of respondent are prefer high risk, high return .And 46% of respondent are prefer medium risk .medium return and 34% of respondent are prefer low risk and low return. .

How much of money invested in above mentioned investment?

Valid

Frequency

Percent

Valid Percent

Cumulative Percent

27

27.0

27.0

27.0

45

45.0

45.0

72.0

10

10.0

10.0

82.0

18

18.0

18.0

100.0

100

100.0

100.0

Less than 10,000 10,000-50,000 50,000-1,00,000 More than 1,00,000 Total

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Analysis: Out of 100 respondent 27% of respondent said less than 10000 amount of money invested in above mentioned invesment.45% are 10000 to 50000 and 10% of respondent are said they invest 50000 to 100000 in above mentioned investments. 18% of respondent are invested more than 100000 in above mentioned investments.

If you save 10000 per month how you divide your savings?

Investment in mutual fund

Valid

Missing

Frequenc y mutual fund 10% 42

Percent 42.0

Valid Percent 50.6

Cumulative Percent 50.6

mutual fund 20%

29

29.0

34.9

85.5

mutual fund30%

5

5.0

6.0

91.6

mutual fund 40%

3

3.0

3.6

95.2

mutual fund50%

3

3.0

3.6

98.8

mutual fund 60%

1

1.0

1.2

100.0

83 17

83.0 17.0

100.0

Total System

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Insurance as an investment tool with regards to ULIP at ICICI LTD Total

100

100.0

Investment in Mutual fund 50

40

30

Frequency

20

10

0 mutual fund 10%

mutual fund30%

mutual fund 20%

mutual fund50%

mutual fund 40%

mutual fund 60%

Investment in Mutual fund

Analysis: Out of 100 respondent 42% of respondent are 10% of the savings will be invested in mutual fund, and 29% of respondent are 20% of the saving swill be invested in mutual fund, 5% of respondent are said they invest 30% in mutual fund. 3 and 3% of respondent are interested to invest in mutual fund that is 40% and 50% and 1% of respondent are interested 60% in mutual fund.

Investment in Equity Frequenc Percent y Valid

Valid Cumulativ Percent e Percent

19

19.0

19.0

19.0

Equity 10%

44

44.0

44.0

63.0

Equity20%

29

29.0

29.0

92.0

Equity 30%

3

3.0

3.0

95.0

Equity 40%

5

5.0

5.0

100.0

Total

100

100.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Investment in Equity 50

40

30

Frequency

20

10

0 equity 10%

equity20%

equity 30%

equity 40%

Investment in Equity

Analysis: Out of 100 respondent 44% of respondent are interested to invest there savings of 10% in equity and 29 of respondent are interested 20% in equity, 3% of respondent are interested in equity, only 5% of respondent are interested 40% in equity.

Investment in fixed deposits Frequen Percent Valid Cumulati cy Percent ve Percent 17 17.0 17.0 17.0

Valid F D 10%

2

2.0

2.0

19.0

F D 20%

10

10.0

10.0

29.0

F D 30%

7

7.0

7.0

36.0

F D 40%

14

14.0

14.0

50.0

F D 50%

15

15.0

15.0

65.0

F D 60%

19

19.0

19.0

84.0

FD 70%

16

16.0

16.0

100.0

Total

100

100.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Invetment in fixed Deposit 30

20

Frequency

10

0 F D 10%

F D 30% F D 20%

F D 50% F D 40%

FD 70% F D 60%

Invetment in fixed Deposit

Analysis: out of 100 respondent 2% of respondent are interested invest 10% in fixed deposits, and 10% of respondent are interested invest 20% in fixed deposits, 7% of respondent are interested invest in 30% in fixed deposits, 14% , 15%, 19%, 16% of respondent are interested in invest that is 40%, 50%,60% ,70%.

Investment in Share market Frequency

Percent

17

Valid share market 10% share market 20% share market 30% share market 40% share market 50% share market 60% Total

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17.0

Valid Percent 17.0

Cumulative Percent 17.0

38

38.0

38.0

55.0

26

26.0

26.0

81.0

10

10.0

10.0

91.0

3

3.0

3.0

94.0

2

2.0

2.0

96.0

4

4.0

4.0

100.0

100

100.0

100.0

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Investment in Share market 50

40

30

Frequency

20

10

0 share market 10%

share market 30%

share market 20%

share markey 50%

share market 40%

share market 60%

Investment in Share market

Analysis: Out of 100 respondent 38% of respondent are interested 10% of there savings in share market, and 26% of respondent are interested 20% in share market, 10% of respondent are interested in share market that is 30%.And 3%, 2%, 4% of respondent are interested to invest 40%. 50% , and 60% of there savings in share market.

Findings 1) 80% of respondent are aware about the ULIP and 20% of respondent are unaware about the ULIP in ICICI prudential.

2) 41% of the respondent are highly satisfied with the performance of the ULIP, 47% of the respondent are satisfied with performance, 8% of respondent are moderate with the performance 1%of respondent are dissatisfied, and another 1% of respondent are highly dissatisfied with the performance of ULIP 3) 17% respondent are said advisor service is Excellence, and 22%of respondent are said good, 40% of respondent are said average , 16% and 3% of respondent are said bad and vast.

4) 23% respondent are highly satisfied with the ULIP, and 47% of respondent are

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Insurance as an investment tool with regards to ULIP at ICICI LTD Satisfied with the ULIP, 22% respondent are moderate with the ULIP, 5% and 1% of respondent are dissatisfied and highly dissatisfied with ULIP. 5) 20% of respondent are highly satisfied with the service provided by the ICICI Prudential,11% of respondent are satisfied with the service of the ICICI prudential, 32 % of respondent are moderate with the service and 26% and 10%of respondent are highly dissatisfied and highly dissatisfied with the service of the ICICI prudential.

6) Out of 80 respondent 43% of respondent are interested to invest in the smart kid, and 20% of respondent are interested in life time gold remaining 38% of respondent are interested in retirement plans in ICICI prudential.

7) 49% of respondent are prefer ICICI for savings and 23% of respondent are prefer for future financial need, 27% of respondent are prefer for tax benefits and 1% are prefer for other purpose

Suggestions  The management should introduce more plans of Retirement policy because many of them are salaried & Business Men to cover the un tapped market.  Management has large scope for Child plans. As we have seen earlier in the purpose of savings table that most of the people invest their savings in Education & Most of the business men invest in insurance for the tax purpose also. So the management concentrate on these plans for attract the customer.  Management should use Newspaper as one of source of creating aware & motivate it’s advisor to create awareness

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Insurance as an investment tool with regards to ULIP at ICICI LTD ďƒź Respondent are dissatisfied with the service of the advisor in the ICICI prudential, so Company take step to improve the service of the advisor and the company should concentrate more on the communication of the advisor. ďƒź Management has to conduct Awareness program to create awareness among another 20% available customers can be tapped by expanding its Business.

BIPLIOGRAPHY 1) Brochures 2) Intranet 4) Internet

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Insurance as an investment tool with regards to ULIP at ICICI LTD  WWW.iciciprulife.com  WWW.google.com

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Insurance as an investment tool with regards to ULIP at ICICI LTD

ANNEXURE

Questionnaire 1) Name: _________________________________________________ 2) Age : 3) Gender:

Male

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Female

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Insurance as an investment tool with regards to ULIP at ICICI LTD

4) Occupation: Business man

Professional

Student

5) Annual Income:

Others__________________

Below & 1,00,000

1,00,000 – 2,00,000

3,00,000 – 4,00,000

5,00,000 & Above

6) Address:_______________________________________________________ _______________________________________________________ _______________________________________________________ 7) Contact number: _______________________________

8) Which of these are important while choosing the life insurance?

Investment

Security

Savings

Tax Benefits

Returns

Financial future need

9) Rank the following based on your priority?

(1 is less priority) ( 5 is more priority)

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Insurance as an investment tool with regards to ULIP at ICICI LTD Returns Security Service Premium 10) What factor influences you to invest in the insurance plan?

Savings

personal financial Need

Tax benefits

if others specify____________

11) Are you aware of ULIP in ICICI prudential life insurance?

Yes

No

If no go to question number 19

12) Why you prefer ULIP in ICICI prudential?

Returns

Safety

Risk cover

Tax benefits

13) How did you come to know about the ULIP in ICICI prudential?

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Insurance as an investment tool with regards to ULIP at ICICI LTD

Friends

Advertisement

Advisor

News paper

Others

14) Are you satisfied with the performance of the ULIP in ICICI prudential? _______________________________________________________________ Highly

Satisfied

Moderate

Dissatisfied

Satisfied

Highly Dissatisfied

15) In which insurance plan would like to invest in ICICI prudential?

Smart kid

Life time Gold

Retirement solution

if other specify_________

16) Are you satisfied with the advisor service in ICICI prudential? _______________________________________________________________ Excellent

Good

Average

Bad

vast

17) Satisfied level towards ULIP s in ICICI prudential?

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Insurance as an investment tool with regards to ULIP at ICICI LTD _______________________________________________________________ Highly

Satisfied

Satisfied

nether satisfied

Dissatisfied

or dissatisfied

Highly Satisfied

18) Are you satisfied with the service provided by the ICICI prudential? ______________________________________________________________ Highly

Satisfied

Moderate

Dissatisfied

Satisfied

Highly Dissatisfied

19) In future you would like to invest in?

Insurance Share market

Mutual fund Investing in gold

Equity Bank Deposits

20) What kind of investment you prefer?

High risk High return Medium Risk Medium Return Low risk Low Return

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Insurance as an investment tool with regards to ULIP at ICICI LTD 21) How much of money invested in above mentioned investments?

Less than 10,000 10,000-50,000 50,000-1,00,000 More than 1,00,000 22) If you save 10,000 per month how you divide your savings?( In percentage) Mutual fund Insurance Equity Fixed Deposits Share market

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