PROJECT REPORT

AT

RUPEE SOLUTIONS FINANCIAL CONSULTANCY, BANGALORE.

“ PREFERENCE FOR UNIT LINK INVESTMENT PLAN

OVER TRADITIONAL INVESTMENT AVENUES ”
(A STUDY ON SECURITY AND INVESTMENT PLAN)

A Project Report submitted in partial fulfillment of the requirements for

the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

(Industry Integrated)
TO

MADURAI KAMARAJ UNIVERSITY, MADURAI

BY

PRIYANKA SHARMA
Reg. No. A8751216
Under the guidance of

Prof. L.H. Bagalkot

Ramaiah Institute of Management Studies

BANGALORE.

December 2009

1
 CERTIFICATE
This is to certify that the project report at

RUPEE SOLUTION FINANCIAL CONSULTANCY, BANGALORE

Submitted in partial fulfillment of the requirement for the award of

the degree of

MASTER OF BUSINESS ADMINISTRATION

(Industry Integrated)

TO

MADURAI KMARAJ UNIVERSITY,

MADURAI

Is a record of bonafide training carried out by

PRIYANKA SHARMA

Under my supervision and guidance and that no part of

this report has been

submitted for the award of any other Degree /

diploma /

fellowship or similar titles or prizes.

FACULTY GUIDE

Signature:

Name: Prof. L.H. Bagalkot

Qualification: Signature & seal of the

learning center.

2
 STUDENT’S DECLARATION

I hereby declare that the Project Report conducted at

RUPEE SOLUTION FINANCIAL CONSULTANCY, BANGALORE

Under the guidance of

Prof. L.H. Bagalkot

Submitted in partial fulfillment of the requirements for the

Degree of

MASTER OF BUSINESS ADMINISTRATION

(Industry Integrated)

TO

MADURAI KAMARAJ UNIVERSITY, MADURAI

Is my original work and the same has not been submitted for the

award of any other Degree / Diploma / Fellowship or other similar

titles or prizes.

Place:- Bangalore
PRIYANKA SHARMA

Date:- Regd.
No. A8751216

3
 ACKNOWLEDGEMENT

I extend my special gratitude to our beloved director Dr. Pattabhiram

and Dean, NIAM Training Officer Mrs. Leela G. for inspiring me to take

up this project.

I wish to acknowledge my sincere gratitude and indebtedness to my

project guide Prof. L.H. Bagalkot of Ramaiah Institute of Management

Studies, Bangalore for her valuable guidance and constructive

suggestions in the preparation of project report.

I extend my gratitude to RUPEE SOLUTION FINANCIAL CONSULTANCY.

And the Territory Manager Mr. Mahesh and all my colleagues, friends for

their encouragement, support, guidance and assistance for undergoing

industrial training and for preparing the project report.

PRIYANKA SHARMA

4
 CONTENTS

Chapter name
Page No.

1. Introduction 06-08
1.1. Needs of the study 8
1.2. Purpose of the study 8
1.3. Methods of Data collection 9

2. Industry profile 09-17

2.1. Insurance industry profile 11
2.2. Benefits of the Insurance 13
2.3. Insurance industry in India 15
2.4. Privates players in India 16

3. Company profile 18-30

3.1. ICICI Pru. Life Insurance 20
3.2. Organizational set up 22
3.3. Promoters of ICICI Pru. 24
3.4. Product profile 25
3.5. Management Hierarchy 29
3.6. SWOT analysis of ICICI Pru. 30

4. Research Methodology 31-38

4.1. Need of the proposed study 33
4.2. Objective of the study 33
4.3. Assumptions underlying the study 34
4.4. Types of research 34
4.5. Research Design 35
4.6. Research Approach 36
4.7. Sampling Plan 36

5
5. Study of the problem 39-52
“ PREFERENCE FOR UNIT LINK INVESTMENT PLAN
OVER TRADITIONAL INVESTMENT AVENUES ”
(A STUDY ON SECURITY AND INVESTMENT PLAN)

5.1. Classification of Life Insurance Products 39

5.2. Investment Options for money 43
5.3. Comparison of ULIPS with Traditional plan 45
5.4. Why/When we recommend Traditional & ULIP 47
5.5. Financial planning & Tax planning 48
5.6. Features of a good saving plan 48
5.7. What makes ULIP a total planning package? 49
5.8. Comparison of ULIP with other investment avenues 50

6. Data analysis and Findings 53-64

6.1. Data Analysis 53
6.2 Findings 64

7. Recommendation 65-67

8. Conclusion /summary 68-69

Annexure 70-72

Bibliography 73

6
CHAPTER- 1

INTRODUCTI
ON

7
 1. INTRODUCTION

This project work is pursued as a part of MBA-MKU (Finance) Curriculum

at RAMAIAH INSTITUTE OF MANAGEMENT STUDIES,
Bangalore. It is undertaken as a traineeship at Rupee Solutions Financial
Consultancy, Bangalore. The project was done under expert supervision
and guidance of Mr. Bagalkot (Lecturer in Research & Economics) and
Mr. Mahesh (Bangalore Regional Sales Manager, Rupee Solutions
Financial Consultancy).

According to the NIAM GUIDELINES, I was required to prepare a

project on a particular topic or problem in the company for at least three
months and have to submit it to company as well as college. Though being a
large company with many problems and certain limitations being a start-up
company, I had recognized many problems, but I was required to choose a
particular problem for research in the company related to my work profile and
area of interest.

My work was of marketing and sales of financial products, the efforts were
done to make improvements in the customer acquisition process for better
results. I was handling life insurance products of ICICI Prudential. The Project
is about the study of the Preference For Unit Link Investment
Plans Over Traditional Investment Avenues.

Though I was working in the financial consultancy but the major focus was
on the ICICI PRUDENTIAL’S ULIP PLAN PRODUCTS. But the major
focuses was on making a customer profile for ICICI PRUDENTIAL and
study the position of Icici prudential in the market as well as among its
competitors and also to find reasons for the preferences of ULIP PLAN over
other investment avenues. In addition, investors were to be made aware
about various products and services offered by Icici prudential and checking
the satisfaction level of present customers.

At Rupee Solutions Financial Consultancy, Bangalore,

Initially the trainees were imparted process and product knowledge. We were
given sufficient time to know about the products and also about sales and
distribution channel. We had to work with the sales representatives of the
Distributor and think of ways of improving the sales and distribution channel
and implementing them. The main aim was to increase sales and for this
different ways were tried and implemented. I was provided with database and

8
had to make telephonic interviews from the data. Company activity was also
one of the major sources for generating business. Initially we were even
accompanied sales representatives to the clients place. Main objective was to
know the need of the customer and how to fulfill that in the best way.

As I was working as an intern there performing the

various operations and work given by the company, I
selected the problem of the changing trends or the
Preference For Unit Link Investment Plans Over Traditional
Investment Avenues of Insurance.

1.1 The need of the study

The need of the study “Preference For Unit Link Investment

Plans Over Traditional Investment Avenues. (A Study on
security and investment plan)”arises because of the reason that a trainee
must understand the company, its achievements and tasks, products and
services and also to collect information about its competitors. I was very much
involved in ulip’s and found that it has several advantages over other
avenues, so, I thought to prepare a project on ULIP’s.

1.2 The purpose of this study

The purpose of this study was to discover the answer for the following
questions with the help of Questionnaire filled by using Interview method. The
objectives of the study were compiled in the following broad groups:
• To know the reasons for increasing trend of unit linked insurance
plan.
• To know how ULIP differ from Traditional plans means how they
gave better returns than traditional plan.
• Comparison of ULIP with other investment instrument available in
the market.
• Comparison of investment plan with other tax saving instruments.
• To check the awareness level of people about insurance.

1.3 Methods of Data collection

9
For the study of the proposed topic a Questionnaire was framed with the help
of the experts involved in the insurance business. I also took the help of some
existing as well as new investors to know their expectations from insurance
products like ULIP and other Traditional products. These methods helped me
to frame the questionnaire as per the need of my study.

For filling up the Questionnaire I selected my sample size of 150 consisting

out of 1500 population, which was randomly selected from the population of
the existing customer data base of the company, based on age, sex, income
level, educational qualification and nature of business. I used personal
Interview method and telephonic interview method to fill the questionnaire. For
getting the outcome I used Exploratory research method and random
sampling method in order to measure attitudes, preferences, and tendency
of selecting the best avenue available for the investment of my sample of the
respondent.
During my Research, I had came across various problems or
limitations in company as well as from the respondents like database
information’s was ambiguous and outdated, calling and taking appointments
from the clients repetitively, have to maintain the records of all the
respondents and call-back them incase they are not available, the long
distance traveling and more time invested than required. Some of the
respondents gave fake information, many of them did not have sufficient
knowledge of the market, the language barrier and the mode of
communications were hard to handle.

To collect the required information from the respondents I had

gone through the following various broachers, books, mails, database,
analysis of the inbound customers requirements and personally gathering the
information’s from various managers of different department. I took the
following variables in my research as income group, maturity, time and the
preferences of people towards ulip’s, their occupation and risk taking
capacities.

The Statistical techniques used by me to complete the research

and conclude the reports were statistical graphs and Microsoft excel was to
prepare the Bar graphs and Pie charts and Histograms.

Note: ULIP (Unit Link Investment Plan) is one of the best-preferred

avenues for the investors today, which serves the investor in multiple ways.
For example it provides not only life cover but also market-based growth of

10
the investment, income tax benefits and medical benefits.

CHAPTER 2

INDUSTRY PROFILE

11
2.1 INSURANCE INDUSTRY PROFILE

Insurance

Insurance may be described as to protect the economic value of asset. It can

be said to be a system of spreading the losses of an individual over a group of
individuals.
Since it is an intangible product, Insurance Industry is a service
industry. Insurance Industry do not produce any goods but sell the promise. A
promise to take care of the customers or their dependents in case they suffer
a loss due to some peril during the term of policy.

What is insurance:
Mankind is exposed to many serious perils such as property losses from fire
and windstorm and personal losses from disability and premature death.
Although it is impossible for an individual to foretell or completely prevent their
occurrence but it is possible to provide against their financial effect the loss of
property and earnings.

From the point of view of the individual the life Insurance may be defined as a
contract whereby for a Consideration amount called the premium, one party
(the insurer) agrees to pay to the other (the insured) or a beneficiary a
particular amount upon the occurrence of death or any other agreed event.

• Insurance is the method of spreading and transfer of risks

• Losses of few unfortunate are shared by and spread over to
many exposed to the same risk.

12
• Assets created by the owner in expectation of future needs
have a value
• Losses of assets for any reason deprive the owner of the expected
benefits.
• It acts as a form of a safeguard against misfortunes.
• From the point of view of community life insurance may be defined as a
social .

Purpose and need of insurance :

As said earlier that the making is exposed to many serious perils which risk
the security of their belongings. The risk here means that there is a possibility
of occurrence of loss or damage to the property, it may happen or may not
happen. Insurance is relevant only in the contingency of uncertainty. If there is
no uncertainly about the occurrence of the loss it can’t be insured against:
• Assets are likely to be destroyed or made non-functional due to perils
like firefloods, breakdowns, lightning and earthquake.
• Damage to assets caused by any perils is the risk that assets are
exposed to.
• Insurance become relevant only if there is uncertainly of occurrence of
event leading to loss.
• No uncertainty No insurance.
• We can say that the human life value is an ongoing generating asset,
which can be lost on early death or disability caused by accidents.
• Insurance doesn’t protect the assets but only compensates the
economic or financial loss.
• Basically insurance covers tangible assets but the concept can be
extended to intangible also.

Life Insurance:

The word ‘Life Insurance’ it self is self-explanatory. It deals with insurance of

human life. “Life Insurance corporation of India”- a public sector undertaking

13
has the monopoly in this sector since its nationalization. In our wordily life,
whenever there is uncertainty, there is an involvement of risk. The instinct for
security against such risk is one of the basic motivating forces determining
human attitudes. As a squeal to this quest for Security, the concept of
insurance must have been born. The urge to provide insurance or protection
against the loss of life & property must have prompted people to make some
sort of sacrifice willingly in order to achieve security through “COLLECTIVE
CO-OPERATION”, in this sense; story of insurance is probably as old as THE
story of mankind.

Why life insurance:

1. Protection of the interest of the family member.

2. Provision for education and marriage of the children.

3. Post retirement income for self and dependents

4. Special needs for medical expenses.

5. Provision for health /illness.

6. Provision for housing.

7. Provision for income tax rebate.

2.2 Benefits of life insurance:

Insurance not only serves the ends of individuals or of special groups of

individuals but also is advantageous to the society as a whole.

Benefits To The Individual:

• Superior to any other saving plans:

Unlike any other saving plan, a life insurance policy affords full protection
against risk of death. In the event of death of a policyholder, the insurance

14
company makes available the full sum assured to the near and dear of
policyholder. In comparison, any other saving plan would amount the total
saving accumulated till date. If the death occurs prematurely, such saving can
be much lesser than sum assured. Evidently, the potential financial loss of the
family of the policyholder is sizable.

• Encourages and forces thrift:

A saving deposit can easily be withdrawn. The payment of Life insurance

premiums, however, is considered sacrosanct and is viewed with the same
seriousness as the payment of interest on a mortgage. Thus, a life insurance
policy in effect brings about compulsory saving.

• Easy Settlement And Protection Against Creditors:

A life insurance policy is the only financial instrument, the proceeds of which
can be protected against the claims of a creditor of the assured by affecting a
valid assignment of the policy.

• Administering the legacy for beneficiaries:

Speculative or otherwise, expenses can quickly cause the proceeds to be

squandered. Several policies have foreseen this possibility and provide for
payment over a period of years or in a combination of installments and lump
sum amounts.

• Ready marketing and suitability for quick borrowing:

A life insurance policy can, after a certain period (generally Three years), is
surrendered for a cash value. The policy is also acceptable as a security for
commercial loans, for example, a student loan.

• Disability benefits:

Death is not only hazard that is insured; many policies may include disability
benefits. Typically, these provide for waiver of future premiums and payment

15
of monthly installment periods.
• Accidental death benefits:

Many policies can also provide for an extra sum to be paid (typically equal to
the sum assured) if death occurs as a result of accident.
• Tax relief:

Under the Indian income tax act, the following tax relief is available
1. 20% of premium can be deducted from total income tax liability.
2. 100% of the premium paid is deductible from your total taxable
income.
When these benefits are factored in, it is found that most Policies offer returns
that are comparable /or even better than other saving modes such as PPF,
NSC etc. moreover, the cost of insurance is a very negligible.

• Benefits to business:

Insurance results in business continuation and welfare of employees.

Uncertainty of business losses is reduced by insurance.

• Benefits of society:

The welfare of the society is protected. Insurance results in economic growth

of the country and reduction in inflation.

2.3 INSURANCE INDUSTRY IN INDIA

India is marching ahead to more prosperous future. The economy is on a

high growth path, domestic savings are growing, exports have risen and
inflation has stabilized. Infrastructure sector, which even today is woefully
inadequate to meet the expected increased industrial activities, has been
accorded top priority by the government. All this should reflect in a growth rate
of 7 to 8% for the next 3-4 years. With this scenario of high economic growth
further reforms in the financial sector are in the Common Minimum Program of

16
the Government. India is regarded as under- insured country with insurance
penetration at a very low level of 0.6% of GDP. Insurance, as a rule, has
always been given very low priority by corporate India. It is always taken with
reluctance, usually only when it is compulsory, and then only by big industrial
houses. Without exception it is always inadequate to meet the needs of the
corporate sector. In addition to the tradition exposure of fire, floods, workers
compensation and the interruption, Corporate India also has to address
unpredictable changes in areas such as environment; security; occupational
health and safety; public liabilities; Directors and Officers Liability and product
liability It therefore becomes quite obvious that purchase of insurance, in
itself, will not substitute for a soundly based and property implemented Risk
Management Program as insurance can only offer some financial relief by
replacing the plants; it cannot replace the loss in development of a business
or development of the market.

2.4 The likely private players in India:

A number of foreign insurance companies have set up representative office in

India and have also tied up with various asset management companies. They
have either signed Memorandum of Understanding with Indian companies or
are trying to do the same. A few of them have been around for the last four to
five years. Some have carried out extensive research on the Indian insurance
sector. Others have set up liaison offices. All of them are waiting with bated
breathe for the opening up of the sector and taking a bite of the great Indian
Insurance pie.

17
 Various Players Presents In The Market

1. Bajaj Allianz Life Insurance Company Limited.

2. Birla Sun Life Insurance Co. Ltd.

3. HDFC Standard Life Insurance Co. Ltd.

4. ICICI Prudential Life Insurance Co. Ltd.

5. ING Vysya Life Insurance Company pvt. Ltd.

6. Life Insurance Corporation of India.

7. Max New York Life Insurance Co. Ltd.

8. Kotak Mahindra Old Mutual Life Insurance Limited.

9. SBI Life Insurance Co. Ltd.

10. Tata AIG Life Insurance Company Limited.

11.Reliance Life Insurance Company Limited.

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

13.Sahara India Life Insurance Co. Ltd.

14.Shriram Life Insurance Co. Ltd.

18
15.Bharti AXA Life insurance Company Ltd.

16.Met Life India Insurance Company Pvt. Ltd.

MOST RELIABLE PVT. LIFE INSURANCE COMPANY

The graph shows that among all the private life insurance companies ICICI
Prudential is the biggest player having 32 % market share. It shows the

19
popularity and acceptance of ICICI Prudential among the people after LIC of
India.

CHAPTER 3

COMPANY PROFILE
20
3.1 ICICI PRUDENTIAL LIFE INSURANCE

ICICI Prudential Life Insurance Company is a joint venture between

ICICI Bank- one of India's foremost financial services companies-and
prudential plc- a leading international financial services group headquartered
in the United Kingdom. Total capital infusion stands at Rs. 20.60 billion, with
ICICI Bank holding a stake of 74% and Prudential plc holding 26%.

We began our operations in December 2000 after receiving approval from

Insurance Regulatory Development Authority (IRDA). Today, our nation-wide
team comprises of over 580 offices, over 230,000 advisors; and 23 bank
assurance partners. ICICI Prudential was the first life insurer in India to
receive a National Insurer Financial Strength rating of AAA (Ind) from Fitch
ratings. As we grow our distribution, product range and customer base, we
continue to tirelessly uphold our commitment to deliver world-class financial
solutions to customers all over India.

ICICI
The World Bank established ICICI LTD in 1955, the Government of India and
the Indian Industry, promote Industrial development of India by providing
project and corporate finance to Indian industry.

21
ICICI has grown from a development bank to a financial conglomerate and
has become one of the largest public financial institutions of India. ICICI has
financed almost all major sector of the economy, covering 6848 companies
and 16851projects. In the fiscal year 2002- 2003, ICICI had disbursed a total
of Rs 45673 billion. Assets worth.1676.59 billion as on 31st of march 2005
and customer 6 million and 5 million policyholder account. Multi channel
network, 573 branches and 2000+ATMs

PRUDENTIAL
Prudential was founded in 1848. Prudential is the largest life insurance
company in the United Kingdom. Provides retail financial services products
and services to more than 20 million customers, policyholder and unit holders
and manages over £300 billion of funds worldwide (as of 31 December 2006).
In Asia, Prudential is the leading European life insurance company with life
operations in China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia,
the Philippines, Singapore, Taiwan, Thailand, Vietnam. Prudential is the
second largest retail fund manager for Asian sourced assets ex-Japan as at
June 2006. Its fund management business has expanded into a total of ten
markets .

ICICI + PRUDENTIAL (JOINT VENTURE)

A Joint venture ICICI and Prudential of UK

ICICI Prudential started its operation in December 2000
The key objective of ICICI prudential is to provide the Indian citizen to suit a
variety of needs.

Prudential “genesis”

Founded in 1848-U.K.
Fourth largest insurance company in the world as per fortune 500 in terms of

22
revenues
Leading life insurance Company in United Kingdom.
Over US$ 270 BILLION (Rs.12, 69,000 crores) under a management.
AAA rating from standard & poor’s (the highest rating)
Over 75 years of experience with operation in 11 countries.

3.2 Organizational set up

•The organizational set up of a company plays an important role in the

overall efficient working of the various departments leading to an
improved overall performance. The arrangement has to be made in
such a way that activities are carried out in each department in the
smooth way.
•The department has to be made on the basis of various activities of the
Company.
•Activities generating revenue are given more importance than non-
revenue activities.
•Thus various offices, departments and sections are created looking to
the important activities of the Insurance Company.
Important activities:

The important activities of the Insurance companies are:-

• Procuring new proposals for grant of life insurance cover.

• Scrutiny of proposals and giving decisions for
• Accepting/rejecting the proposals of Insurance.
• Issuing a policy document.

• Keeping track of performance of insurance contract by way of receipt of

premiums.

23
 • Providing assistance in various matters like nominations, assignment,
alteration of terms, change of address and payment of claims.
• Other activities like investment of funds, maintenance of accounts,
personnel management, data processing and complying with other
legal and regulatory requirements
• These can be termed as the important activities of the Life Insurance
companies. The insurance companies may concentrate these
activities at ones place if it area of operation is limited or the activities
may be decentralized because of the fact that the area of that
company is also decentralized.
Structure Of The Company :

The ICICI Prudential is a joint venture of ICICI (74%) and Prudential UK

(26%). ICICI Prudential Life Insurance was incorporated on July 20,2000 and
was granted a certificate of registration for carrying out life insurance
business, by the IRDA on November 24,2000. ICICI Prudential's capital base
stands at Rs. 18.15 billion with ICICI Bank and Prudential plc holding 74%
and 26% stake respectively. For the 9 months ended December 31, 2006, the
company garnered Rs.27.22 billion of weighted retail and group new business
premium and wrote over 1.1 million policies. Assets held stand at
over Rs.1000 billion. It commenced commercial operation on December
19,2000 becoming one of the first private sector players to enter the
liberalized arena. During the short period till March 31,2003 The company has
issued 2.45 policies translating into a premium Income Rs 59.7 million and the
sum assured of over Rs 1000 million. The company is now operating in
Mumbai.New -Delhi, Pune, Chennai, Kolkata, Banglore, Ahmedabad,
Hyderabad and Lucknow.

3.3 Promoters Of ICICI Prudential

24
ICICI Bank :

ICICI Bank is India’s second-largest bank with total assets of about

Rs.1892.18 billion and a network of about 590 branches and offices and
about 2030 ATMs. It offers a wide range of banking products and financial
services to corporate and retail customers through a variety of delivery
channels and through its specialized subsidiaries and affiliates in the areas of
investment banking, life and non-life insurance, venture capital, asset
management and information technology. ICICI Bank posted a net profit
ofRs.1, 637 crore for the year ended September 30,2005. ICICI Bank’s equity
shares are listed in India on stock exchanges at Chennai, Delhi, Kolkata and
Vadodara, the Stock Exchanges, Mumbai and the National stock exchange Of
India limited and its American Depositary Receipts (ADRS) are listed other
New York Stock Exchange (NYSE).

PRUDENTIAL PLC :

Established in Londan 1848, Prudential plc is a leading international financial

services company In the UK, with around US$300 billion funds under
management, and more than 20 Million customers worldwide (as of 31
December). Prudential has brought to market an integrated range of Financial
services products that now includes life assurance, pensions, mutual funds,
banking investment management and general insurance. In Asia, Prudential is
UK’s largest life insurance company with a vast network of 24 life and mutual
fund operations in twelve countries—China, Honk Kong, India, Indonesia,
Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand and
Vietnam.

3.4 PRODUCT PROFILE

Insurance Solutions for Individuals :

25
ICICI Prudential Life Insurance offers a range of innovative, customer-centric
products that meet the needs of customers at every life stage. Its products
can be enhanced with up to 4 riders, to create a customized solution for each
policyholder. Savings & Wealth Creation Solutions:
• Save'n'Protect is a traditional endowment savings plan that offers life
protection along with return.
• CashBak is an anticipated endowment policy ideal for meeting milestone
expenses like a child's marriage, expenses for a child's higher
education or purchase of an asset. It is available for terms of 15 and 20
years.
• LifeTime Super & LifeTime Plus are unit-linked plans that offer
customers the flexibility and control to customize the policy to meet the
changing needs at different life stages. Each offer 6 fund options -
Preserver, Protector, Balancer, Maxi miser, Flexi Growth and Flexi
balanced.
• LifeLink Super is a single premium unit linked insurance Plan, which
combines life insurance cover with the opportunity to stay invested in
the stock market.
• Premier Life Gold is a limited premium paying plan specially structured
for long term wealth creation.
• InvestShield Life New is a unit linked plan that provides premium
guarantee on the invested premiums and ensures that the customer
receives only the benefits of fund appreciation without any of the risks
of depreciation.
• InvestShield Cashbak is a unit linked plan that provides premium
guarantee on the invested premiums along with flexible liquidity
options.

Protection Solutions :

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

available in 3 options - level term assurance, level term assurance with
return of premium and single premium.

26
 • Home Assure is a mortgage reducing term assurance plan designed
specifically to help customers cover their home loans in a simple and
cost effective manner.

• Child Plans: Education insurance under the Smart Kid brand provides
guaranteed educational benefits to a child along with life insurance
cover for the parent who purchases the policy. The policy is designed
to provide money at important milestones in the child's life. Smart Kid
plans are also available in unit-linked form - both single premium and
regular premium.
Retirement Solutions:

• Forever Life is a traditional retirement product that offers guaranteed

returns for the first 4 years and then declares bonuses annually
.
• Lifetime Super Pension is a regular premium unit linked pension plan that
helps one accumulate over the long term and offers 5 annuity options
(life annuity, life annuity with return of purchase price, joint life last
survivor annuity with return of purchase price, life annuity guaranteed
for 5,10 and 15 years & for life thereafter, joint life, last survivor annuity
without return of purchase price) at the time of retirement.
• Life Link Super Pension is a single premium unit linked pension plan.

Immediate Annuity is a single premium annuity product that

guarantees income for life at the time of retirement. It offers the benefit
of 5 payout option.

Health Solutions:

• Health Assure and Health Assure Plus: Health Assure is a regular

premium plan which provides long term cover against 6 critical
illnesses by providing policyholder with financial assistance,
irrespective of the actual medical expenses. Health Assure Plus offers
the added advantage of an equivalent life insurance cover. Cancer
Care: is a regular premium plan that pays cash benefit on the diagnosis

27
 as well as at different stages in the treatment of various cancer
conditions.

• Diabetes Care: Diabetes Care is a unique critical illness product specially

developed for individuals with Type 2 diabetes and pre-diabetes. It
makes payments on diagnosis on any of 6 diabetes related critical
illnesses, and also offers a coordinated care approach to managing the
condition. Diabetes Care Plus also offers life cover.

Hospital Care: is a fixed benefit plan covering various stages of

treatment –
hospitalization, ICU, procedures & recuperating allowance. It covers a
range of medical conditions (900 surgeries) and has a long term
guaranteed coverage up to 20 years.

Group Insurance Solutions:

ICICI Prudential also offers Group Insurance Solutions for companies

seeking to enhance benefits to their employees.
• Group Gratuity Plan: ICICI Pru's group gratuity plan helps employers
fund their statutory gratuity obligation in a scientific manner. The plan
can also be customized to structure schemes that can provide benefits
beyond the statutory obligations.
• Group Superannuation Plan: ICICI Pru offers both defined contribution
(DC) and defined benefit (DB) superannuation schemes to optimize
returns for the members of the trust and rationalize the cost. Members
have the option of choosing from various annuity options or opting for a
partial commutation of the annuity at the time of retirement.
• Group Immediate Annuities: In addition to the annuities offered to
existing superannuation customers, we offer immediate annuities to
superannuation funds not managed by us.
• Group Term Plan: ICICI Pru's flexible group term solution helps provide

28
 affordable cover to members of a group. The cover could be uniform or
based on designation/rank or a multiple of salary. The benefit under the
policy is paid to the beneficiary nominated by the member on his/her
death.

Flexible Rider Options:

ICICI Pru Life offers flexible riders, which can be added to the basic
policy at a marginal cost, depending on the specific needs of the
customer.
Accident & disability benefit: If death occurs as the result of an accident
during the term of the policy, the beneficiary receives an additional
amount equal to the rider sum assured under the policy. If an accident
results in total and permanent disability, 10% of rider sum assured will
be paid each year, from the end of the 1st year after the disability date
for the remainder of the base policy term or 10 years, whichever is
lesser. If the death occurs while traveling in an authorized mass
transport vehicle, the beneficiary will be entitled to twice the sum
assured as additional benefit.
Critical Illness Benefit: protects the insured against financial loss in
the event of 9 specified critical illnesses. Benefits are payable to the
insured for medical expenses prior to death.
Waiver of Premium: In case of total and permanent disability due to an
accident, the future premiums continue to be paid by the company till
the time of maturity. This rider is available with LifeTime Super
LifeTime Super Pension and CashPlus.

29
 3.5 Management hierarchy

MD&C.E.O


EXECUTIVE DIRECTOR


HEAD OF SALES


VICE PRESIDENT


ASSOSIATE REGIONAL MANAGER

AREA MANAGER


SALES MANAGER


AGENCY MANAGER


UNIT MANAGER


ADVISIORS

30
VISION
To make ICICI Prudential the dominant life, health and Pensions player built
on trust by world –class people and service. This we hope to achieve by:
• Understanding the needs of customers and offering them superior products
and service
• Leveraging technology to serve customer quickly, efficiently and
conveniently.
• Developing and implementing superior risk management and investment
strategies to offer sustainable and stable returns to our policyholders.
• Providing an enabling environment to foster growth and learning for our
employees.
And above all, building transparency in all our dealings.
The success of the company will be founded in its unflinching commitment to
5 core values- integrity, customer first, Boundary less, Ownership and
passion. Each of the values describes what the company stands for the
qualities of our people and the way we work.
We do believe that we are on the threshold of an exciting new opportunity,
where we can play a significant role in redefining and reshaping the sector.
Given the quality of our parentage and the commitment of our team, there are
no limits to our growth.

3.6 SWOT ANALYSIS OF ICICI PRUDENTIAL

Strengths:

• ICICI Prudential is the largest private player in the insurance industry in

INDIA , with a market share of around 32% amongst the private players.
• It received best products innovation award from Asian banker in 2001.
• Vast untapped market. In a country of 1 billion people there is huge potential
market for life insurance products.
• There is a huge pool of skilled professionals to carry out the successful

31
ventures.
• ICICI Prudential is one of India’s leading financial institutions.
• Offering a complete financial solution that encompasses every sphere of life.
• From commercial banking
To stock broking
To mutual funds
To life insurance
To investment banking,

The group caters to the financial needs of individuals and Corporate.

ICICI prudential is the first company, which got license of insurance trading
from I.R.D.A. (Insurance Regulatory & Development Authority)
• ICICI Prudential is leading in securities.
• The company has a network in 74 cities in India and offices in New-York,
London and Dubai.
• The group services a customer base of over 2.7 million.

Weaknesses:

• Though there is a huge market for insurance polices, the middle class who
constitutes bulk of this market is burdened with inflationary pressure and
therefore is not able to save for future.
• Less popularity of ICICI Prudential in villagers.
• Most of the people have faith on LIC as it is a Govt. Organization.

Opportunities:

• Out of 320 million insurable market only 20% of population is insured.

• The ICICI Prudential group is going to open 100 branches of ICICI
Prudential in coming 4-5 years.
• The insurance sector is growing so there is opportunity for business growth.
• Unemployment is today a big problem in our country; therefore people who
have the potential should be encouraged to enter in to this sector.

32
Threats :

• Competition is growing as new entrants are coming in insurance sector.

• Main threat is “COMPETITORS”.

CHAPTER 4

RESEARCH METHODOLOGY

33
 RESEARCH METHODOLOGY

Research Methodology deals with, the procedure adopted to carry out the
study. According to green and Tull:
“A research design is the specification of methods and procedures acquiring
the information needed. It is the overall operational pattern or framework of
the project that stipulates which information is to be collected from which
sources by what procedures’’. For conducting the study, as a researcher I
adopted both primary as well as secondary method of data collection.

4.1 NEED OF THE PROPOSED STUDY

•The need of the study arises because of the reason that a trainee must
understand the company, its achievements and tasks, products and
services and also to collect information about its competitors.
• But the major focus was on making a customer profile for icici
prudential and study the position of Icici prudential in the market as
well as among its competitors. In addition, investors were to be made
aware about various products and services offered by Icici prudential
and checking the satisfaction level of present customers.
• What were the reasons of neglecting the traditional plans and giving
the preference to ULIP? Which feature of ULIP attracted them more?
Are they satisfied with the features offered in ULIP or can it be made
more customers friendly?

34
 4.2 OBJECTIVES OF STUDY

The purpose of research is to discover answer to questions through the

application of scientific procedures. The main aim of research is to find out
truth which is hidden and which has not been discovered as yet. Though each
research study has its own specific purpose.
The objective of the study of “Preference For Unit Link Investment

Plans Over Traditional Investment Avenues” was to discover

the answers for the following questions with the help of Questionnaire filled by
Interview method. The objectives of the study were compiled in the following
broad groups:

• To know the reasons for increasing trend of unit linked insurance

plan.

• To know how ULIP differ from Traditional plans means how they
gave better returns than traditional plan.

• Comparison of ULIP with other investment instrument available in

the market.
• Comparison of investment plan with other tax saving instruments.
• To check the awareness level of people about insurance.

4.3 ASSUMPTIONS UNDERLYING THE STUDY

The basic assumptions underlying the study were:

• All the People/ customers were rational.

• They will prefer the best avenue to park their funds in the given situation.
• There was no bias.

35
 • The method used in this study is rational and based on judgmental scale
and methods.

4.4 TYPE OF RESEARCH

Research refers to the search for knowledge. It can be defined as scientific

and systematic search for pertinent information on a specific topic. It is careful
investigation or enquiry especially through search for new facts of any branch
of knowledge.
In this study I used Exploratory research, which provides insights into and
comprehension of an issue or situation. It helped me to draw some definitive
conclusions. Exploratory research is a type of research conducted when the
problem has not been clearly defined. It helps in determine the best research
design, data collection method and selection of subjects. Given its
fundamental nature, exploratory research often concludes that a perceived
problem does not actually exist.

4.5 Research Design

A research design or a structure is the process done before data collection or

analysis can commence. A research design is not just a work plan. A work
plan details what has to be done to complete the project but the function of a
research design is to ensure that the evidence obtained enables us to answer
the initial question as unambiguously as possible. In other words, during
designing the research we need to ask: given this research, what type of
evidence is needed to answer the question (or test the theory) in a convincing
way?

In order to design the research it was needed to have perfect design for
sufficient data collection from different data sources to meet the objective of
the study. For this study I used both the methods of data collection. For

36
collecting the primary data I used questionnaire filled by interview method and
I went through the available sources of data like company data base,
publications and Internet for getting the secondary data. This collection of
data, both primary and secondary helped me to meet my objective of the
proposed study.

Primary data:

The primary data was collected with the help of questionnaire filled using
Interview method. As per the need of the study I formulated the questionnaire
with the help of the experts of insurance sector and some existing as well as
new customers whom I could bank up on. This helped me to frame the
required level of questionnaire needed for the study of the stated problem.

Secondary data:

The secondary data was collected from the database, publications and the
websites of the company through Internet.

4.6 Research Approach:

For this study I used Exploratory research method and personally visited the
person selected as my sample for the study, randomly selected from the
population of the existing customer data base in the company, and collected
the required information in the form of data with the help of questionnaire filled
with personal interview and the company sources.

4.7 _ Sampling plan:

This is the stage where the planning is done about the sample size and

37
sampling procedures. According to the sampling plan I opted the following
basis for study.

4.8 (A) Sample size:

The sample size means how many peoples should be interviewed in order to
get the primary data. In this research process the sample size was 150 (10%
of the total population), which was selected on random basis from the
population consisting 1500 existing customers of 2008-09, belonging to
different areas of Bangalore based on their age, sex, income level,
educational qualification and nature of job. Since I was unable to study the
entire population due to some constraints like time, money, resources, and

technologies during study. So I selected a small sample, chosen randomly,

but it was taken care that it should represent the population in such a way that
I could get the optimum response out of it. I interpreted the data of the
response from such sample.

4.8 (B) Sampling Procedures:

I chose random sampling process for my research. This was done in the
following manner. i.e. All the names of the population (1500) written on a
paper chit kept in a box and randomly picked 150 chits. Whoever name were
there selected as a sample of the study.

38
 CHAPTER 5

PROBLEM OF THE STUDY

“ PREFERENCE FOR UNIT LINK

INVESTMENT PLAN OVER TRADITIONAL

39
 INVESTMENT AVENUES ”

(A STUDY ON SECURITY AND INVESTMENT PLAN)

ICICI Prudential is dealing with the various natures of insurance products.

Broadly it is classified into two categories: - traditional plans and ULIP. In
traditional plans Term Insurance, Whole life insurance, Endowment Policy etc
are the main policies before coming the ULIP into existence. They were
known as the best avenues, but as the ULIP came into picture people started
neglecting the traditional plans and tending towards ULIP. Why it happened?
To get the answer let us know the two separately.

5.1 Classification Of Life Insurance Products

To get the exact reasons of the proposed study and outcome, it is needed to
know the basic features of the Insurance plans available in the market. Based
on the information insurance plans can be classify into two category.

✪ Traditional plan and

✪ULIP

5.1 (A)_Traditional
Term Insurance:

Under term insurance plan, sum assured is payable only if death occurs
during the specified pre-determined term. If death does not take place during
such term the amount of premium stands forfeited. Thus it can be seen that

40
the term insurance is nothing but the cost of pure protection. It is a contract,
which provides financial protection if death should occur within a specified
period. No survival benefits are provided under the contract.

Whole life insurance:

Whole life insurance provides for the payment of the face value upon the
death of the insured, regardless of when it may occur. This policy furnishes
permanent protection to the insured at he moderate cost. This is highly
important for the average man or woman of moderate salary, who require
considerable family protection and whose limited income does not enable him
or her both to pay premiums and to accumulate a large savings fund. The
whole life policy provides a capital sum of money in the event of death of the
assured whenever that may occur.

Endowment Policy:

Endowment is a product, which includes Risk cover and saving also. In the
pure endowment policy the sum assured is payable in the event of death or
definitely on maturity. In an endowment sum assured is for sure given to the
policyholder on completion of the term. Endowment plans are very popular in
developing nations since they serve a dual purpose of life cover and savings.
Many a people in our country go for endowment products because of the
compulsory saving aspect. An endowment plan on the other hand is not a
cheap plan since the insurer has a dual liability of providing life cover and on
maturity giving the entire sum assured.

Annuities:

Annuities refer to income or other financial provision usually for retirement or

old age. An Annuity may be defined as a periodic repayment made during a
fixed period or for the duration of a designated life or lives. In one sense the
life annuity may be described as the opposite of insurance protection against

41
death in its pure form a life annuity may be defined as a contract whereby for
a premium consideration one party (the insurer) agrees to pay the other (the
annuitant) a stipulated sum (the annuity) periodically throughout life. The
purpose of the annuity is to protect again a risk—the outliving of one’s
income.

5.1 (B) UNIT LINKED INSURANCE PLAN (ULIP)

Unit linked insurance plan (ULIP) is a life insurance solution that provides the
client with the benefits of protection and flexibility in investment. It is a solution
which provides for life insurance where the policy value at any time varies
according to the value of the underlying assets at the time .
The investment is denoted as unit and is represented by the value that it has
attained called as Net Asset Value (NAV).

ULIP came into play in 1960s and became very popular in Western Europe
and America. The reason that is attributed to the wide spread popularity of
ULIP is because of the transparency and the flexibility which it offers to the
clients . As time progressed the plans were also successfully mapped along
with life insurance needs to retirement planning. In today’s times ULIP
provides solution for all the needs of a client like insurance planning, financial

42
needs, financial planning for children’s future and retirement planning.

Structure Of Ulip

Benefits 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. Life protection
2. Investment and Savings
a. Market linked fund based on risk profile
b. Switch option
c. Premium redirection
d. Automatic transfer plan (ATP)
3. Flexibility of cover continuance
4. Transparency
5. Extra protection with riders
a. Death due to accident

43
 b. Disability
c. Critical illness
6. Liquidity

a. During the term partial withdrawal is allowed and also at the

Maturity

7. Tax planning

5.2 Investment Option For Money

Maxi miser: If high growth is your priority, this is the plan for you. You can
enjoy long-term capital appreciation from a portfolio that is invested primarily
in equity and equity-related securities

Protector: - If on the other hand, your priority is steady returns, you can opt
for the protector Plan. Plan, you can accumulate a steady income at a low risk
across a medium to long-term period from a portfolio, which is primarily
invested in fixed income securities.

Balancer : -If you prefer a balance of growth and steady returns, choose our
balancer plan. This would ensure that your portfolio is invested in equity-
linked securities, as well as in fixed income securities.

Preserver: - The objective of this plan is not ensuring capital protection by

investing in very low risk investments like the cash and call money markets.
However, the returns generated may also be on the lower side due to the
investment pattern. At inception, investments up to 20% can be allocated to
this fund.

44
Automatic Transfer Plan

45
✪ Funds would get transferred automatically a fixed date every month (1st or
15th ) from protector to maxi miser.
✪ You can either choose a fixed amount or a fixed percentage.
✪ Minimum ATP is Rs.2000
✪ ATP will cease if the funds in the protector are insufficient.
✪ Effectively this works like 12 free switches of fixed installments over and
above the 4 free switches.

5.3 COMPARISION OF ULIP WITH TRADITIONAL PLAN

Unit Linked Insurance Product :

ULIPs have gained high acceptance due to attractive features they offer.
These include:
✪ Flexibility
• Flexibility to choose Sum Assured.
• Flexibility to choose premium amount.
• Option to change level of Premium /Sum Assured even after the plan
has started.
• Flexibility to change asset allocation by switching between funds

46
✪ Transparency
• Charges in the plan & net amount invested are known to the customer
• Convenience of tracking one’s investment performance on a daily
basis.
✪ Liquidity
•Option to withdraw money after few years (comfort required in case of
exigency)
•Low minimum tenure.
• Partial / Systematic withdrawal allowed
✪ Fund Options

• A choice of funds (ranging from equity, debt, cash or a combination)

• Option to choose your fund mix based on desired asset allocation

Traditional Plans :

These are the oldest types of plans available. These plans cater to customers
with a low risk appetite. Some of the common features of traditional plans are:
✪ Steady Investment
•Major chunk of investible funds are in debt instruments
•Steady and almost assured returns over the long term

✪ Features

• Death benefit is Sum Assured + guaranteed & vested bonus

• Helps in asset creation as they are for a long tenure
• Premium to Sum Assured ratios are fixed for each plan and age.
• Generally withdrawals are not allowed before maturity.

47
5.4 Why/When we recommend TRADITIONAL and ULIPs

We recommend traditional policies:

...Where the objective is only Risk cover and not savings and cost has to be minimum.

We recommend Unit Linked products where:

•The intention is to provide security for a goal.

•The purpose is to make the savings grow at a better rate seeking the
best solution.
• It is a market linked investment where the premium paid is invested in
different funds
•Different options are available, like 100% Equity, Balanced, Debt, Liquid
etc and according to the fund selected, the risks and returns vary.
• The costs are upfront and are transparent, the investment made is

48
 known to the investor (As he is the one who decides where his money
should be invested).
• There is a greater flexibility in terms of premium payments i.e. A
premium holiday is possible.

•You can also invest surplus money by way of top ups which will increase
your investment in the fund and thereby provide a push to returns as
well.
•There is no assured Sum on survival, the higher of the Sum Assured or
Fund Value is paid at the maturity or incases of death.

5.5 Financial planning and tax planning

All of us want to save for a rainy day. We want our money or investment to:
(i) Give the best possible return and
(ii) Be available to us when we require it.
Financial planning makes this possible. Financial planning is an attempt to
maximize returns keeping in mind the liquidity and security of our investment.

The three basic principles (guiding factors) of financial planning are:

•Setting realistic financial goals
•Starting investments early

Thinking long term while allowing for short-term needs that may arise.
•One plus lump sum of money to
(a) Produce income.

49
 (b) Increase the capital
One can invest money only when one possesses it, which is possible by
saving systematically. Selecting a good saving scheme can do this.

5.6 Features of a Good Saving Plan:

✪ Safety

✪ Flexibility

✪ should have incentive to save continuously without default.

✪ Tax saving

✪ Should fulfill financial objective even in case of death.

Features of an ideal Investment Scheme:

(a) Safety

(b) Liquidity

(c) Higher Yield

(d) Capital growth

(e) Tax saving

50
 5.7 What makes ULIPs a total financial planning package?

•Potential for Superior returns by switching between Equity & Debt

•Anytime Liquidity
•No Long Term Commitments
•Flexible Insurance Cover
•100% Tax Free Returns on Withdrawals & Maturity

5.8 Comparison of ULIP with other Investment Avenues

51
 Now it is necessary that we understand a few terms before look in to
the various financial planning ways:

• Save: this is an activity that helps in the “asset allocation”. It has both a
short term & long term perspective.

52
• Invest: this is an activity that focuses “asset creation”. It involves making
money from money.
• Spend: this is the activity of using the money for our expenses.

53
 CHAPTER 6

DATA ANALYSIS AND FINDINGS

6.1 Data analysis

In this study a structured Questionnaire was framed for studying the proposed
study. The questionnaire was framed in such a way that covers all the aspects
of the customers and product profile. In the beginning some question were
asked to know about the tax payment, possession of life insurance, of which
company what were the motives and so on, then the questions were related to
traditional plans of LI and then regarding ULIP. Why they prefer , what benefit

54
they got against traditional, was any specific reason for buying, were they
satisfied with ULIP, if not, what additional features they wanted to be added in
that.

SAMPLE SIZE

Respondent Category No. Of People

Service Man 50

Business man 40

Shopkeeper 25

House Wife 12

Other 23

Total 150

Interpretation: For the study of the proposed topic my sample size

was 150. This pie chart shows that out of that total 150: Service
Men were 50, Businessmen 40, Shopkeeper 25, House Wife 12,
and others were 23.

Q 1. Do you pay income tax?

55
 CATEGORY NO. OF PEPOLE

YES 123

NO 27

TOTAL 150

Interpretation: This data shows that the most of the people are tax payee
adding to 123 people out of 150 .

Q2. Do you have any insurance policy?

OPENION NO OF PEOPLE TOTAL %

YES 130 87

NO 20 20

TOTAL 150 100

Interpretation: The pie chart depicts that from 150 respondents a major
part resulting to 87% of the total were having some kind of insurance policy.

Q3. Which company’s policy you are having?

COMPANIES PEOPLE %
LIC 92 61

56
 ICICI 12 8

HDFC 10 7

OTHER 16 11

NON POLICY HOLDER 20 13

TOTAL 150 100

Interpretation: The pie chart illustrates that out of all the 150 respondents
61% is having LIC policy, which is the major player of the insurance sector.
While the share of non-policyholder is only 13%. This depicts that an average
number of the respondents are holding policy, for the purpose of minimizing
the risk.

Q.4 Do you know about the ICICI PRU. ?

CATEGORIES NO. OF PEPOLE %

YES 87 58

NO 63 42

TOTAL 150 100

57
Interpretation: This pie chart shows that Icici Prudential has a reasonable
amount of Brand awareness showing about 58% of the total. This brand
image should be further leveraged by the company to increase its market
share over its competitors.

Q5. How did you come to know about the company?

CATEGORIES NO. OF PEPOLE %

ADVERTISEMENT 59 40

WORD OF MOUTH 44 29

YOUR BANK 11 7

INSURANCE AGENT 36 24

TOTAL 150 100

Interpretation: Out of all the 150 respondents 40% knew about ICICI

58
Prudential through Advertisement, 29% word of mouth, and 24% through the
agents of the company.

Q6 what kind of plan do you have?

CATEGORIES NO.OF PEPOLE TOTAL%

ENDOWNMENT 29 19

TERM 16 11

ULIP 85 57

NO POLICY HOLDER 20 13

TOTAL 150 100

Interpretation: Out of all the 150 respondents 57% is having ULIP plan,
19% endowment and 11% term insurance.

Q7. Are you satisfied with your Investment?

CATEGORIES NO. OF PEOPLE %

SATISFIED 83 56

UNSATISFIED 47 31

NO POLICY HOLDER 20 13

TOTAL 150 100

59
Interpretation: The data shows that out of all the 150 respondents 56% are
satisfied with their investment plans.

Q8. Are you aware about the benefit and the condition about your plan?

CATEGORIES NO. OF PEPOLE %

COMPLETE AWARE 34 23

ADEQUATE AWARE 25 17

CONFUSE 20 13

60
 LESS KNOWLEDGE 28 19

COMPLETE UNAWARE 23 15

NO POLICY HOLDER 20 13

TOTAL 150 100

Interpretation: The data shows that out of all the 150 respondents only
23% are completely aware and 17% are adequate aware about the benefit
and the condition of their plan.

Q9. How much return you are expecting from your ULIP?

CATEGORIOES NO OF PEPOLE %

15-25% 30 20

25-35% 32 21

61
 35-45% 28 19

MORE THAN 45% 40 27

NON POLICY HOLDER 20 13

TOTAL 150 100

Interpretation:The data shows that out of all the 150 respondents 27%were
expecting more than 45% return and rest below 45% but not less than 15%.

Q11. Do you think lifetime super an ULIP investment plan of ICICIPRU is better than
other traditional investment plans?

CATEGORIES NO.OF PEPOLE %

YES 49 33
NO 39 26
DON’T KNOW 62 41

62
 TOTAL 150 100

Interpretation:The data shows that out of all the 150 respondents one third
(33%)were agree that ICICI Pru. Policy was better than traditional plans.

Q12. Why did you purchase an insurance plan?

CATEGORIES NO. OF PEPOLE %

FOR PROTECTION 22 15

FOR SAVING 31 21

63
 FOR INVESTMENT 54 35

FOR TAX SAVING 43 29

TOTAL 150 100

Interpretation:The data shows that out of all the 150 respondents 35%
purchased insurance plans for their investment purpose, 29% for tax saving,
and only 15 % for protection.

Q13. Do you think ULIP is a risky investment?

CATEGORIES NO.OF PEPOLE %

VERY RISKY 20 13
MODERATE 27 18
SAFE 51 34
VERY SAFE 30 20
NON POLICY HOLDER 22 15

64
 TOTAL 150 100

Interpretation: Thes data shows that out of all the 150 respondents
34%said ULIP a safe avenue, 18% moderate risk and 20% said as risky
investment.

6.2 FINDINGS

65
✪ Today, people mainly prefer ULIP for saving, then bank then Post-Office
and after that prefer P.P.F. and other. The main reason behind the
insurance plan or ULIP preference is switching facility or option to
choose fund.
✪ People prefer high growth as well as safety of Principle as compare to
less growth & return even after taking certain level of risks.
✪ People mainly purchase life insurance policy / ULIPs for investment and
then for tax-saving they give 2nd preference to protection today.
✪ Approximately 20% people do not know what is insurance.
✪ I also find that people mainly prefer L.I.C. as compare to private
insurance company.
✪ In my survey, I also find that only 56% people are satisfied with current
policy.
✪ I also find that only 58% people know about the ICICI Prudential Life
Insurance.

66
 CHAPTER 7

RECOMMANDATIONS

RECOMMENDATIONS

67
1. Emphasis on advertisement: Company should emphasis on insurance
plan advertisement, because at present company main focus on
conventional product advertisement.

2. Increase the commission: Company should also change the

commission structure of F.C., because in initial year commission is very
high as compare to remaining year. So F.C. does not focus on
remaining year and many policies lapsed.

3. Making ICICI more accessible: Here I mean that as 80% of the

population of India is rural therefore ICICI must have there branches in
important towns so it not only this will increase the awareness among
people more over it will help the company to acquire local market and
cater to their needs effectively.

4. There should be a product with good features and low initial premium:
A product like Life Time super is suitable for all but the initial premium
which cannot be less than 20000 rs. is on the higher side , therefore the
company should derive a product with similar features but with low initial
premium so that it is affordable to normal service class.

5. Administration charges should be low as in comparison with mutual

funds, national saving certificate (N.S.C),etc.: The company should
lessen down the administration charges so that this product can have
an edge over other investment modules like N.S.C, P.P.F etc.

68
6. Market surveys should be conducted regularly so that to know about
customer demands and changing needs: The company should know
about the customers changing needs and demands by conducting
market surveys which are helpful in innovating a product which suits the
customers requirements.

7. There should be Training batches on weekends: It is advised that the

Company should have training batches for the already serving class on
Weekends , so that the willing candidates can opt it as a part time
business opportunity.

69
 CHAPTER 8

SUMMARY/CONCLUSION

8.1 SUMMARY/CONCLUSION

70
In India, insurance is generally considered as a tax-saving device instead of
its other implied long-term financial benefits. Indian people are prone to
investing in properties and gold followed by banks deposits. They selectively
invest in shares also but the percentage is very small—4.5%. Even to this
day, Life insurance market has become more vibrant. Smashing all doubts
over the decision to liberalize the industry, the overwhelming first year
performance of the Indian insurance sector is test case of a massive success
story of private players entering into the erstwhile state monopoly.
The top three insurance companies-ICICI Prudential Life Insurance Company,
HDFC Standard Life and Max New York Life- combined managed to sell over
two lakh policies in a single year. ICICI Prudential, touted as the number one
private life insurer, scored on all three fronts-with the maximum number of
policies sold (1,00,000 policies), highest amount of premium collected (Rs.
2,700 crore).

8.2 Limitations of the Study

How so ever impeccable a thing may see to be there always dwell some
possibilities of failure and incompleteness. The result of this work was also
subject to some of limitations, which were as follows:
• The main limitation of the study was the availability of time. As the
sufficient time was not available for collection of data I could not collect
sufficient data.
• Some respondents were not interested in giving answer and they
appeared to be busy.
• Lack of experience. And above all
• Time constraint and expense/ cost related to all my ways of collection of
data, getting appointments, traveling to the potential people were the
main hurdles in this study.

71
 8.3 Significance of the study

The significance of the study is the finding the exact reasons of preference of
ULIP over the traditional avenues (like term insurance) Which helped not only
me but also the company to serve the customers in a better way in order to
sustain in cut throat competition. The main outcomes were as follows:

• Why Ulip was the best-preferred avenue?

• What were the benefits offered by ULIP?
•Demerits of Traditional plans.
•What would be the prospective ways to attract new customers?
• What were the customer’s likings and disliking in today’s scenario?
• How to fit in to the customer’s needs and wants.

8.4 DISCRIPTION OF LEARNING EXPERIENE :-

This Study helped me in understanding the corporate environment from

both the angles Company and Client. There were both positive and

negative experiences during the training. Some of the main aspects

were:

█ Real exposure to the corporate world, which helped me a lot to

understand the mindset of an executive to a certain extent.

█ Learn about the customer’s requirements, customer’s mindset

and how to convince them.

█ It helped me in improving my communication skills, presentation skills

and how to interact with the customers.

█ I became aware of the new changes happening in the organization,

72
which helped me in learning how to deal with the clients in variety of situations.

Apart from the above-mentioned positive experiences I also faced certain

problems, which I would like to discuss here:

█ It was quite difficult in the beginning to cope up with the requirement of

the M.B.A. program and the job simultaneously.

█ Initially it took some time to understand the process of sales opening

and closing, and doing live Study of the problems, however with time I get

adjusted to the situation and worked on it sincerely. Now I feel much more

confident in handling sales calls and doing research study.

ANNEXURE

Q 1. a) Do you make investments?

73
 Yes ( ) No ( )
b) If Yes, where do you make investment?
Bank deposits ( ) Mutual Funds( )
Shares( ) life insurance ( )
Postal deposit schemes ( ) Real estate ( )
Precious metal ( )
Company debentures and deposits ( )
Q 2. What are the reasons to make investments?
Tax Saving ( ) Return ( )
Capital Appreciation ( )
secure investment ( )
Life cover ( )
Other ( )
Q3. Are you satisfied with your Investment?
YES ( ) NO ( )
Q 4. In which sector do you prefer to invest your money?
Private Sector ( )
Government Sector ( )
Q 5. Do you think services provided by private sector will be better than
public sector companies?
Yes ( ) No ( )
Q 6. Are private life insurance companies reliable for Investment?

Yes ( ) No ( )
Q 7. Have you heard about private insurance company icici prudential life?
Yes ( ) No ( )
Q 8. From where did you come to know about icici prudential life insurance?
Electronic media ( ) print media ( )
Seminar ( ) Work shops ( )
Advisor ( ) others ( )
Q 9. a) Are you aware of unit linked insurance Plans (ulip)?
Yes ( ) No ( )
b) If Yes, Do you know, FULLY AWARE LITTLE AWARE
UNAWARE

74
 The working of ULIP ( ) ( ) ( )
Criteria for returns ( ) ( ) ( )
Different Plans ( ) ( ) ( )
Where your fund invested by insurer ( ) ( ) ( )
Switching Option( ) ( ) ( )
Q 10. a) Have you ever invested in ULIP plans?
Yes ( ) No ( )
b) If Yes, please specify: -

PLAN NAME:
Saving plan ( ) protection plan ( )
Pension plan( ) children’ s plan ( )
Q 11. What are the reason for investment in ulip
Life protection ( )
Investment and Savings ( )
Flexibility ( ) Transparency ( )
Liquidity ( ) Tax planning ( )
Q 12. Which company policy do you have?
ICICI Prudential ( )
HDFC Standard ( )
Bajaj Allianz ( )
Birla Sun Life ( )
Lic ( ) Other ………………………………...
Q13. How much return you are expecting from your ULIP?
15-25%
25-35%
35-45%
More than 45%

Q14. Do you think ULIP is a risky investment?

VERY RISKY
LESS RISKY
SAFE
VERY SAFE

75
Q 15. Do you have any plan to buy ulip plans in near future?
Yes ( ) No ( )
Q 16. If you are not taking any ulip plans, please tell us the reasons why?
We couldn’t afford ( )
We don’t see any benefit with the system. ( )
We don’t want insurance. ( )
We don’t understand how ulip works. ( )
We are not too much aware of ulip plans. ( )
Q 17. What steps do you suggested to the companies to make their ULIP
plans more popular?
Give more advertisements. ( )
Arrange more work shops. ( )
Arrange more seminars ( )
Reduce charges ( )
Create awareness through advisors ( )

Other Additional suggestions..……………………………..

……………………………..……………………………..
……………………………..……………………………..
……………………………..
…………………………………………………………………….

18. Personal Details

NAME-------------------------AGE------------------------------------
QUALIFICATION----------------------------------------------------
OCCUPATION---------------------------------------------------------
ADDRESS---------------------------------------------------------------
----------------------------------------------------------------------------

BIBLIOGRAPHY
Secondary Sources:

Sharma G.D ,(1985)

76
“Indicators of Performance of Universities”
(National Institute ………, New Delhi .)

ICICI Prudential Life Insurance Co. Ltd. (2009),

“Unit Linked Product Guide”
(ICICI Prulife ………,Mumbai)

(IRDA's Annual Report - 2008)

“Disclosures forming part of Financial Statements”
IRDA (Investment) (Amendment) Regulations

(Sept, 2008)
Life Insurance in India 1956

(Kothari Cr 2008)
“Research Methodology Methods & Techniques”
(New Age International (p) Limited)

Brochures:

ICICI Prudential Life Insurance Company Ltd, UNI: 105v01 L/IC/26, 2004
Life Insurance Company Ltd, UNI: 05l058v01 L/IC/02 1956.

Websites:

www.google.com
www.bimaonline.com
www.licindia.com
www.iciciprulife.com

77