ACKNOWLEDGEMENT

I express my sincere thanks to my project guide, Ms. Sakshi Chouhan

Designation _________________, Deptt Management., for guiding me right form the
inception till the successful completion of the project. I sincerely acknowledge
him/her/them for extending their valuable guidance, support for literature, critical reviews
of project and the report and above all the moral support he/she/they had provided to
me with all stages of this project.

I would also like to thank the supporting staff ___________________________

Department, for their help and cooperation throughout our project.

Sanjay behara

Name of the Students

1
 Executive summary

In the insurance industry, there are two channels of distribution- Alternate Distribution
and Tide Agency. Advisor Recruitment is the part of Tide Agency.

My project is about agency recruitment & channel distribution of ICICI Prudential Life
Insurance. It means company is recruiting advisors for expanding its business.
Company adopts chain marketing as a methodology for expansion.

In this project, I have to make a cold call to the target market, get the appointment with
them, convince them & close the sale positively. The queries, which are asked by the
client, should be solved by the discussion with the company guide.

ICICI Prudential is immensely concentrating on the agency recruitment. It has 33000

advisors and it is planning to extend this number to 53000 by the end of the year 2004-
05.

For recruiting advisors, ICICI Prudential holds many activities like- they do direct
marketing for recruiting advisors, they also recruit the management trainees for
recruiting advisors, they also hold seminar and also include stall activities etc.

2
 Chapter 1
Introduction of Organization

3
 INTRODUCTION

All the human beings on the earth know that they will die in future but they don’t want to
die. They want to fulfill all the dreams, which they had thought, but there are times when
all these dreams can’t come true.

Death is inevitable and yet we live our lives obvious to reality that may strike- when we
have no idea. And when it happens, all the dreams come crashing down.

In the words of D S Hansell “Insurance may be defined as a social device

providing financial compensation for the effects of misfortune, the payment being
made from the accumulated contributions of all the parties participating in the
scheme”

Life insurance is the only tool to secure our life in future. It also provides a safe guard to
the uncertainty of our life. Life insurance is the cheapest investment tool in which we
can earn more in a short period of time.

The function of insurance is to protect you against losses you can't afford. This is done
by transferring the risks of a person, business, or organization -- the "insured" -- to an
insurance company, or "insurer." The insurer then reimburses the insured for "covered"
losses -- i.e., those losses it pays for under the policy's terms. As the insurance
consumer, you pay an amount of money, called a premium, to the insurer to transfer
the risk. The insurer pools all its premiums into a large fund, and when a policyholder
has a loss, the insurer draws funds from the pool to pay for the loss. Life is full of
unexpected events that can create large financial losses. For example, whenever you
drive, it is possible that you may have a costly accident. Risks affect you by causing
worry about potential loss and how to deal with the consequences. Insurance reduces
anxiety over a possible loss and absorbs the financial brunt of its consequences.

4
India has traditionally been a high savings oriented country being on par with the thrifty
Japan. Insurance sector in the United States of America is as big in size as the banking
industry there. This gives us an idea of how important the sector is. Insurance sector
channelises the savings of the people to long-term investments. In India where
infrastructure is said to be of critical importance, this sector will bring the nations own
money for the nation.

• The global life insurance market stands at $1,521.2 billion while the non-life
insurance market is placed at $922.4 billion.
• India takes the 23rd position with US $9.933 billion annual premium collections
and a meager 0.41% share.

Out of one billion people in India, only 35 million people are covered by insurance.

• Indian insurance market is set to touch $25 billion by 2010, on the assumption of
a 7 per cent real annual growth in GDP.

In 3 years time we would expect the 10% of the population to be under some sort of an
insurance cover. This assuming a premium of Rs. 5000 on an average, amounts to 100
million x Rs.5000 = Rs. 500 bn.

This has made the sector the hottest one in India after IT. With social security and
security to the public at large being the agenda for opening the sector, the role of the
regulator becomes all the more serious and one that would be carefully watched at
every step.

5
 HISTORY OF LIFE INSURANCE

Insurance concept had been found out way behind in 13 th and 14th century. The earliest
reference to insurance has been found Babylonia, the Greeks and the Romans. The use
of insurance appeared in the account of North Italian Merchant Bank that then
dominated the international trade in Europe at that time.

The oldest and earliest record of insurance come in the form of marine insurance where
ships and the cargo were insured against perils such as pirates, storm, mutiny and
wars.

The first company known as the Sun Insurance Office Ltd. was set up in the Calcutta in
the years 1710. After that a number of companies were established for marine and
general insurance. The history of life insurance in India dates back to 1818 when it
was conceived as a means to provide for English Widows. Interestingly in those days a
higher premium was charged for Indian lives than the non-Indian lives as Indian lives
were considered more riskier for coverage.

The Bombay Mutual Life Insurance Society started its business in 1870. It was the first
company to charge same premium for both Indian and non-Indian lives. The Oriental
Assurance Company was established in 1880. The first general insurance company-
Tital Insurance Company Limited was established in 1850. Till the end of nineteenth
century insurance business was almost entirely in the hands of overseas companies.

Insurance regulation formally began in India with the passing of the Life Insurance
Companies Act of 1912 and the provident fund Act of 1912. Several frauds during 20's
and 30's sullied insurance business in India. By 1938 there were 176 insurance
companies. The first comprehensive legislation was introduced with the Insurance Act of
1938 that provided strict State Control over insurance business. The insurance business
grew at a faster pace after independence. Indian companies strengthened their hold on

6
this business but despite the growth that was witnessed, insurance remained an urban
phenomenon.

The Government of India in 1956, brought together over 240 private life insurers and
provident societies under one nationalised monopoly corporation and LIC was born.
Nationalisation was justified on the grounds that it would create much-needed funds for
rapid industrialization. This was in conformity with the Government's chosen path of
State led planning and development.

The (non-life) insurance business, however, continued to thrive with the private sector
till 1972. Their operations were restricted to organized trade and industry in large cities.
The general insurance industry was nationalised in 1972. With this, nearly 107 insurers
were amalgamated and grouped into four companies- National Insurance Company,
New India Assurance Company, Oriental Insurance Company and United India
Insurance Company. These were subsidiaries of the General Insurance Company
(GIC).

7
 OVERVIEW

With largest number of life insurance policies in force in the world, Insurance happens to
be a mega opportunity in India. It’s a business growing at the rate of 15-20 per cent
annually and presently is of the order of Rs 450 billion. Together with banking services,
it adds about 7 per cent to the country’s GDP. Gross premium collection is nearly 2 per
cent of GDP and funds available with LIC for investments are 8 per cent of GDP.

Yet, nearly 80 per cent of Indian population is without life insurance cover, health
insurance and non-life insurance continue to be below international standards. And this
part of the population is also subject to weak social security and pension systems with
hardly any old age income security. This itself is an indicator that growth potential for the
insurance sector is immense.

A well-developed and evolved insurance sector is needed for economic development as

it provides long-term funds for infrastructure development and at the same time
strengthens the risk taking ability. It is estimated that over the next ten years India would
require investments of the order of one trillion US dollar. The Insurance sector, to some
extent, can enable investments in infrastructure development to sustain economic
growth of the country.

With a large capital outlay and long gestation periods, infrastructure projects are fraught
with a multitude of risks throughout the development, construction and operation stages.
These include risks associated with project implementation, including geological risks,
maintenance, commercial and political risks. Without covering these risks the financial
institutions are not willing to commit funds to the sector, especially because the
financing of most private projects is on a limited or non- recourse basis.

Insurance companies not only provide risk cover to infrastructure projects, they also
contribute long-term funds. In fact, insurance companies are an ideal source of long-

8
term debt and equity for infrastructure projects. With long-term liability, they get a good
asset- liability match by investing their funds in such projects.

IRDA regulations require insurance companies to invest not less than 15 percent of their
funds in infrastructure and social sectors. International Insurance companies also invest
their funds in such projects.

Insurance is a federal subject in India. There are two legislations that govern the sector-
The Insurance Act- 1938 and the IRDA Act- 1999.

PRESENT SCENARIO

The Government of India liberalized the insurance sector in March 2000 with the
passage of the Insurance Regulatory and Development Authority (IRDA) Bill, lifting all
entry restrictions for private players and allowing foreign players to enter the market with
some limits on direct foreign ownership. Under the current guidelines, there is a 26
percent equity cap for foreign partners in an insurance company. There is a proposal to
increase this limit to 49 percent. Premium rates of most general insurance policies come
under the purview of the government appointed Tariff Advisory Committee.

INSURANCE IN INDIA

The insurance sector in India has come a full circle from being an open competitive
market to nationalization and back to a liberalized market again. Tracing the
developments in the Indian insurance sector reveals the 360 degree turn witnessed over
a period of almost two centuries.

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A brief history of the Insurance sector:

The business of life insurance in India in its existing form started in India in the
year1818 with the establishment of the Oriental Life Insurance Company in Calcutta.
Some of the important milestones in the life insurance business in India are:

1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate
the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to collect
statistical information about both life and non-life insurance businesses.

1938: Earlier legislation was consolidated and amended by the Insurance Act with the
objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies were taken over by the
central government and nationalised. LIC formed by an Act of Parliament, viz. LIC Act,
1956, with a capital contribution of Rs. 5 crores from the Government of India.

The General insurance business in India, on the other hand, can trace its roots to the
Triton Insurance Company Ltd., the first general insurance company established in
the year 1850 in Calcutta by the British. Some of the important milestones in the general
insurance business in India are:

1907: The Indian Mercantile Insurance Ltd. set up, the first company to transact all
classes of general insurance business.

1957: General Insurance Council, a wing of the Insurance Association of India, frames a
code of conduct for ensuring fair conduct and sound business practices.

1968: The Insurance Act amended to regulate investments and set minimum solvency
margins and the Tariff Advisory Committee set up.

10
1972: The General Insurance Business (Nationalisation) Act, 1972 nationalised the
general insurance business in India with effect from 1stJanuary

1973: 107 insurers amalgamated and grouped into four companies viz. the National
Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental
Insurance Company Ltd. and the United India Insurance Company Ltd. GIC
incorporated as a company.

11
 INSURANCE SECTOR REFORMS

In 1993, Malhotra Committee, headed by former Finance Secretary and RBI Governor
R.N. Malhotra, was formed to evaluate the Indian insurance industry and recommend its
future direction. The Malhotra committee was set up with the objective of
complementing the reforms initiated in the financial sector. The reforms were aimed at
creating a more efficient and competitive financial system suitable for the requirements
of the economy keeping in mind the structural changes currently underway and
recognizing that insurance is an important part of the overall financial system where it
was necessary to address the need for similar reforms. In 1994, the committee
submitted the report and some of the key recommendations included:

 Structure: Government stake in the insurance Companies to be brought down to

50% Government should take over the holdings of GIC and its subsidiaries so
that these subsidiaries can act as independent corporations. All the insurance
companies should be given greater freedom to operate.
 Competition: Private Companies with a minimum paid up capital of Rs.1bn
should be allowed to enter the industry. No Company should deal in both Life and
General Insurance through single entity. Foreign companies may be allowed to
enter the industry in collaboration with the domestic companies .Postal Life
Insurance should be allowed to operate in the rural market .Only one State Level
Life Insurance Company should be allowed to operate in each state.

 Regulatory Body: The Insurance Act should be changed .An Insurance

Regulatory body should be set up. Controller of Insurance (Currently a part from
the Finance Ministry) should be made independent.
 Investments: Mandatory Investments of LIC Life Fund in government securities
to be reduced from 75% to 50%.

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 GIC and its subsidiaries are not to hold more than 5% in any company
(The recurrent holdings to be brought down to this level over a period of time)

 Customer Service: LIC should pay interest on delays in payments beyond 30

days. Insurance companies must be encouraged to set up unit linked pension
plans. Computerization of operations and updating of technology to be carried
out in the insurance industry. The committee emphasized that in order to improve
the customer services and increase the coverage of the insurance industry
should be opened up to competition.

But at the same time, the committee felt the need to exercise caution as any
failure on the part of new players could ruin the public confidence in the industry.
Hence, it was decided to allow competition in a limited way by stipulating the
minimum capital requirement of Rs.100 Crores.

The committee felt the need to provide greater autonomy to insurance companies
in order to improve their performance and enable them to act as independent
companies with economic motives. For this purpose, it had proposed setting up
an independent regulatory body.

The Insurance Regulatory and Development Authority 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. The other decisions taken by them simultaneously
were to provide the supporting systems to the insurance sector and in particular the
life insurance companies were the launch of the IRDA 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. Since being set up as

13
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.

The opening up of the sector is likely to lead to greater spread and deepening of
insurance in India and this may also include restructuring and revitalizing of the
public sector companies. A host of private Insurance companies operating in both
life and non-life segments have started selling their insurance policies since 2001.

14
 LIFE INSURANCE MARKET

The Life Insurance market in India is an underdeveloped market that was only tapped
by the state owned LIC till the entry of private insurers. The penetration of life insurance
products was 19 percent of the total 400 million of the insurable population. The state
owned LIC sold insurance as a tax instrument, not as a product giving protection. Most
customers were under- insured with no flexibility or transparency in the products. With
the entry of the private insurers the rules of the game have changed.

The 12 private insurers in the life insurance market have already grabbed nearly 9
percent of the market in terms of premium income. The new business premiums of the
12 private players have tripled to Rs 1000 crores in 2002- 03 over last year. Meanwhile,
state owned LIC's new premium business has fallen.

Innovative products, smart marketing and aggressive distribution. That's the triple
whammy combination that has enabled fledgling private insurance companies to sign up
Indian customers faster than anyone ever expected. Indians, who have always seen life
insurance as a tax saving device, are now suddenly turning to the private sector and
snapping up the new innovative products on offer.

The growing popularity of the private insurers shows in other ways. They are coining
money in new niches that they have introduced. The state owned companies still
dominate segments like endowments and money back policies.

But in the annuity or pension products business, the private insurers have already
wrested over 33 percent of the market. And in the popular unit-linked insurance
schemes they have a virtual monopoly, with over 90 percent of the customers.

The private insurers also seem to be scoring big in other ways- they are persuading
people to take out bigger policies. For instance, the average size of a life insurance
policy before privatization was around Rs 50,000. That has risen to about Rs 80,000.

15
But the private insurers are ahead in this game and the average size of their policies is
around Rs 1.1 lac to Rs 1.2 lac- way bigger than the industry average.

DEFINITION OF INSURANCE

Insurance is a contractual-type financial intermediary that offers the public protection

against the financial costs associated with the loss of life, health, or property in
exchange for premiums.

An agreement that guarantees the payment of a stated amount of monetary benefits

upon the death of the insured.

Risk insurance intended as protection against the financial consequences of the death
of the insured person, which takes the form of payment of a previously agreed lump
sum or pension to a beneficiary, if the insured person dies during the term of insurance.
In the case of pure life insurance, without any endowment insurance component, no
payments are due if the insured person survives the term of insurance.

Insurance is that which provides protection against the economic loss caused by the
death of the person insured.

What is Insurance?

Life Insurance is a contract providing for payment of a sum of money to the person
assured or, to the person entitled to receive the same, on the happening of a certain
event.

A family is dependent for its food, clothing and shelter on the income brought by the
family's breadwinner. The family is secure so long as this breadwinner is alive and is
capable of earning. A sudden death (or disability) may leave the family in a financially
difficult situation. Uncertainty of death is inherent in human life and this uncertainty

16
makes it necessary to have some protection against the financial loss arising from
untimely death. Life insurance offers this protection.

The Greeks and Romans started the earliest type of life insurance. Contributions were
made by all surviving members for the burial cost of a member. In case of the death of a
member the cost of burial was made out of the contributed fund.

In the 17th century, the Tontine Annuity system was introduced where associations of
individuals were formed without any reference to age, and a fund was created by equal
contributions from each member. The sum collected was invested, and at the end of
each year the interest was divided among the survivors. The last remaining survivor
received both the year's interest and the entire amount of the principal.

The first organized life insurance company was founded in 1759 in Philadelphia, in
North America. Subsequently, over the past three centuries, numerous life insurance
Companies sprung up, making life insurance a popular tool for protection coupled with
investment.

Why do you need life Insurance?

You need Life Insurance because typically the need for income continues for those who
are financially dependent on you, but there is no guarantee of your ability to earn
consistently and for the rest of your life. Life insurance can help you safeguard the
financial needs of your family.
This need has become even more important due to steady disintegration of the
prevalent joint family system, and emergence of nuclear families. The need to protect
your family's ever growing needs is why you need Life Insurance.

Replacement of Income

17
Life insurance products can provide support to the family and take care of the family's
financial requirements. It provides a lump sum or periodic payments to help replace the
income stream, in case of an unfortunate event or an untimely demise of the
breadwinner.
Lifestyle Maintenance
Life insurance products can help you build a corpus to protect and maintain your
lifestyle against fluctuations in your future income.

Costs of Education
You need to support your child with a sound educational background, to help your child
achieve his/her dreams. Life insurance products can help you fulfill these needs,
whether you are there or not.

Retirement Expenses
Retirement is an age when an individual has fulfilled almost all his responsibilities and
looks forward to relaxing. Life insurance products can help you lead a secure and
tension free retired life by ensuring that you get guaranteed pension.

Mortgage and Debt protection

With increasing consumerism and ever-rising demands, loans and debts are now part of
life. Life insurance products help you ensure that your family is not unduly burdened
with their repayments, in case of an unfortunate event or an untimely demise of the
breadwinner.

Hardships Protection
Life insurance provides a sense of security to the income earner and to his/her family.
Buying life insurance frees the individual from various unnecessary financial burdens
that can otherwise make one spend sleepless nights.

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 BENEFITS OF LIFE INSURANCE

Superior to Any Other Savings Plan

Unlike any other savings plan, a life insurance policy affords full protecton against risk of
death. In the event of death of a policyholder, the insurance company makes available
the full sum assured to the policyholders' near and dear ones. In comparison, any other
savings plan would amount to the total savings accumulated till date. If the death occurs
prematurely, such savings can be much lesser than the sum assured. Evidently, the
potential financial loss to the family of the policyholder is sizable.

Encourages and Forces Thrift

A savings 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 savings.

Easy Settlement and Protection against Creditor

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 effecting a valid assignment
of the policy.

Administering the Legacy for Beneficiaries

19
Speculative or unwise expenses can quickly cause the proceeds to be squandered.
Several policies have foreseen this possibility and provide for payments over a period of
years or in a combination of installments and lump sum amounts.

Ready Marketability and Suitability for Quick Borrowing

A life insurance policy can, after a certain time period (generally three years), be
surrendered for a cash value. The policy is also acceptable as a security for a
commercial loan, for example, a student loan. It is particularly advisable for housing
loans when an acceptable LIC policy may also cause the lending institution to give loan
at lower interest rates.

Disability Benefits

Death is not the only hazard that is insured; many polices also include disability
benefits. Typically, these provide for waiver of future premiums and payment of monthly
installments spread over certain time period.

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
a) 20 % of the premium paid can be deducted from your total income tax liability.
b) 100 % of the premium paid is deductible from your total taxable income.

20
When these benefits are factored in, it is found that most polices 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.

Life insurance V/S other investments

 Most investment options make your money work harder, but there are no
substitutes to life insurance. Because only a life insurance policy gives you both -
risk cover against your life, as well as returns on your money invested.

 Life insurance allows long tem savings to be made in a relatively painless

manner because of the low and convenient investments made through
premiums. Moreover, it encourages 'forced thrift' which means the insured is
made to pay premiums and save money, which he/she may not do in the regular
course of life.

 Should you require loans, say for building a house, it can be easily obtained
against a life insurance policy. Amongst the most known benefits of Life
Insurance is the savings on your income taxes.

 Life insurance cannot be compared with any other form of investment as life
insurance gives you a life long benefit and returns on your money when it is most
required.

 Insurance premiums are linked to age of the life insured and the earlier you buy,
the lower are the premium requirements. Besides, the money stays invested for a

21
 longer time and thereby maximizing your returns through the power of rupee
compounding. So, a life insurance policy is an ideal tool to gain security and
ensure savings.

 Most importantly it provides you with that unique sense of security and peace of
mind that no other form of investment provides.

ROLE OF LIFE INSURANCE

 Security and Stability

 Investment
 Preservation of Health
 Increase Efficiency
 Self Reliance
 Mental Peace
 Planning of future
 Safe guard against statutory liability
 Capitalization of earning capacity
 Exemption from Tax Liability
 Safety to Investment Mode.

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INSURANCE ADVISOR
“Persons who sell insurance policies, for a single insurance company, in return for a
commission are called ADVISORS.”

Insurance Advisors are the bridge or the channel partners between the policyholder and
insurance company. They make the base for the insurance company. In other words, it
can be said that advisors are those people in the organization who can give business to
the company.

They are the representatives of an insurance company who sells insurance. An

insurance advisor locates prospective insurance customers, determines the insurance
needs of each customer, and assists the customer in applying for insurance. Typically,
an insurance advisor will deliver the policy when the application is approved, will collect
the initial premium, and will provide customer service to policy owners. An advisor is
also called a field underwriter or a life underwriter.

Some other ways to sell insurance policies are:

Bancassurance and Corporate Agency.

WHY TO BE AN ADVISOR?

 No start up capital required

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  Flexible working environment
 Be your own boss
 Unlimited earning potential
 To be part of a world-class team

WHO CAN BE THE ADVISORS?

While making advisors for the company, certain characteristics have to be kept in
mind. They are as under:

 A person should be between the age group of 25-40 years.

 Should be a graduate or old SSC Pass.
 Should preferably be married.
 Should be a localite.

Apart from this, there is a certain target audience that has to be targeted:

 Chartered Accountants
 Company Secretaries
 Tax Consultants
 Businessmen
 Beauty Parlors
 Management Consultants
 Advocates
 Engineers
 Tour and Travels owners
 Air ticket bookings
 Two and Four wheeler finance companies
 Courier services
 Retailers of different products
 Computer Hardware Business

24
  Software Business
 Furniture shops

BE AN ADVISOR

Being an ICICI Prudential advisor can be an enriching and exciting career option. It’s an
opportunity to associate with an industry leader, be in touch with the latest and finest
insurance practices from around the globe, and grow both personally and professionally.

Here are some of the benefits of being an ICICI Prudential Life Insurance Advisor:

 Unlimited earning potential.

 Clear career path.
 All round support through exclusive advertising, your own in-house
consultant, and world-class training.
 A comprehensive benefit package.

What does it take to be an ICICI Prudential advisor?

At ICICI Prudential, we believe that our Advisors are our ambassadors to the customers.
They are a key source of business for the organization, and are the continuing link with
our clients. That is why, a lot of care is taken in recruiting and developing the advisor
force, so that the company continues to set higher standards of quality in service and
salesmanship. To cater to the needs of the knowledge-oriented marketplace, the look
out is for graduates who are service-oriented, good communicators and enjoy meeting
new people. Prior sales experience is an added benefit.
Some of the qualities that the company seeks are:

 Self-motivation
 A master communicator
 A go-getter
 A graduate

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TRAINING

At ICICI Prudential, the importance is given to training in a dynamic business

environment. The advisors go through both generic and specific, professional programs
that help them remain well informed and knowledgeable about the company’s products
in the market. There is a further focus on soft skills such as communication, managing
long-term relationships and selling skills, which are very relevant in a service-driven
industry like life insurance.
State of the art infrastructure training facilities coupled with an excellent faculty,
guarantee an exceptional learning environment. For advisors who might be occupied
with their daily business/professional routines, ICICI Prudential also offers convenient
training options such as online and self-learning are also provided by the organization.

A 17-day training schedule covers the mandatory IRDA training requirements and ICICI
Prudential product-training module. Revision session ensure that the candidates
thoroughly understand the course contents and are well prepared for the licensing
examination. Theoretical training is interspersed with practical appointment settings with
potential customers, giving advisors a feel of how their business will work from the very
first day. All through, the Unit Manager and the management provide continuous
support to the advisors in achieving independence towards garnering business.

BENEFITS OF AN ADVISOR

There are some reasons and parameters to be an advisor of the insurance company
which are mentioned below:

Money:
Money is the biggest reason to join as an advisor in a life insurance company. Only in
this industry you can invest minimum and earn maximum. There is no limit for earning in
this industry.

Estate creation:

26
In this industry, the advisors are also paid commission till the maturity of the policy.
Moreover, advisor is also paid renewal commission every year and this renewal
commission helps the advisors to build an estate. It means a policy that is sold today will
pay the advisors may be more than 10 to 15 years.
It means each year you will get more and create an estate for advisors like house, car,
children’s future etc.

Status:
Advisors secure the life of the human beings. They give advise to their client where to
invest money and where not. So advisors become specialist in the investment field. It
means advisors will get status by helping the human beings by a proper guidance.

Prestige:
Company will give the advisors foreign trips, gifts and many more things. It also
provides advisors a club membership. These all will give the advisors prestige and a
unique position in the society.

Honour:
ICICI Prudential life insurance provides motivational factors to the advisors. It gives a
target to the advisors and if advisors reach this target, ICICI Prudential will give them a
trophy, a certificate and incentives in the meeting of the company. Advisors can also
become the member of MDRT and the ICICI Prudential Life Insurance will honour such
advisors.

Widen social circle:

Life insurance is the business of contacts. As the time passes in this business more
people will know and recognize the advisors. In this way, the advisors can widen their
social circle in a strategic manner.

27
Mitigate human hardship:
When advisors come into the life insurance business, they don’t sell only policy to the
people but they provide safety against the uncertainty of the life. They help the people in
peace of mind, freedom from the troubles and help them support themselves.

Contribute to the nation:

Each policy sold by the advisors will help the nation to increase the funds that go
towards developing the country, for improving economy, improve standard of living and
nurture the up coming industries.

ADVISOR’S ROLE

Identify future client:

Advisor has to find the client who can pay regular premium to the company because
company will pay commission on the premium collected by the advisor.

Making appointments:
Just making contacts is not enough for an advisor in the life insurance business but he
has to keep in touch constantly with the client so that he can understand the need of the
client can provide a proper policy/safety to the client.

Conduct financial review with clients:

Advisor must make his client aware of different types of the policy of the company. He
also gives financial review like:

28
 How much a client will get after the maturity of the policy?
 How much premium he has to pay?
 How much bonus and addition benefit will the client get? Etc.

29
Close sale:
Ultimately success is defined in terms of sales. The advisor should lead each
appointment towards a sale and close effectively wherein the client is happy on
purchasing the insurance solution and feels satisfied with it.

Get referrals:
As mentioned above- insurance is the business of contacts- the best way to get
reference or contact is advisors’ prospects and clients. It will help advisors to increase
relation in the market.

Provide service to the client:

Insurance is the service business. Service should be on the mark in this kind of
business. The motto of ICICI Prudential is to provide good service to the client so in
ICICI Prudential each advisor must give very good service to the client.

Career
At ICICI Prudential, career development is emphasized upon from the very day the
advisor joins the system. Though individual meetings with his or her manager, the
advisor can discuss various issues related to business development and career
enhancement. Expectations from the organization in terms of chalking a career in the
insurance industry are also discussed.

Tiger Team:
ICICI Prudential offers the “Tiger Team” programme for identified high potential
advisors. Hand picked by the management, these advisors are placed on a fast-track
career path and recognized as ‘Tiger trainers’. The advisors can participate in this
programme, subject to certain criteria being fulfilled.

30
Pinnacle Program:
Absorption into the management is another career enhancement option provided at
ICICI Prudential through the Pinnacle Program. This program helps advisors build a full
time career as a unit manager in the organization, offering great potential for managing
a team of advisors and personal development. ‘Fast track Pinnacle’ programme is also
available to advisors who are able to meet the performance criteria within the stipulated
time.

Rewards and Recognition

ICICI Prudential advisors are constantly recognized and rewarded for their performance.
Numerous contests all year round promote healthy competition amongst advisors and
recognition for their efforts. Depending on the level of business the advisor achieves in a
year, he or she can become a member of various clubs such as the President’s club,
ICICI Pru Star International and the ICICI Pru Star India club. Each of these clubs have
specific performance criteria for qualification and members of these clubs are entitled to
attend seminars held at exotic international and domestic locations each year. Advisors
can also qualify for the renowned MDRT (Million Dollar Round Table), an exclusive
international insurance advisors club.

31
 Commission Structure (Compare with LIC)

No. LIC I Pru LIC I LIC I Pru LIC I Pru LIC I Pru
(Product) (Product (BC Pru (RC) (RC) (RC) 4yr (RC) 4 yr (AC) (AC)
) ) in (BC 2-3 yr 2-3 yr onward onwards
(%) )
1. Children
Plan
Jivan Smart 15 20 5 7.5 5 5 25 32.5
Kishor Kid
2 Money
Back Plan
Money Cash Bak 15 20 10 7.5 6 5 31 32.5
Back
Jivan Cash Bak 15 20 7.5 7.5 5 5 27.5 32.5
Samruddhi
3 Term
Assuranc
e
Anmol Life 2 2 0 0 0 0 2 2
Jivan-I Guard(S
(SP) P)
New Bima Life 15 25 10 7.5 6 5 31 37.5
Kiran Guard(S
P)
4 Pension
Plan
Jivan Pension 7.5 7.5 2 2 2 2 11.5 11.5
Suraksha-I Plan
Jivan Pension 7.5 7.5 2 2 2 2 11.5 11.5
Dhara-I Plan
5 Investmen
t Plan
Jivan Life Time 5 12 2.25 4 2.25 2 9.5 18
Anand
6 Whole Life

32
 Plan
Ajivan Forever 25 7.5 7.5 5 5 5 37.5 17.5
Vima Life
Policy
7 Savings
Plan
Jivan Save n' 25 25 7.5 7.5 5 5 37.5 37.5
Shree(>=1 Protect(>
5yr) =15yrs)
Jivan Save n' 20 20 7.5 7.5 5 5 32.5 32.5
Shree(bet Protect
ween 10- (<15yr)
14yr)

BC- Base Commission

RC- Renewal Commission
AC- Accumulated Commission

MOTIVATING FACTORS FOR THE ADVISORS

Every time only money might not be the motivator to the advisor. ICICI Prudential
believe that there are many other things that advisors aspire to achieve-fame and
recognition and desire to take a holiday abroad are some of the things that advisors can
hope to achieve during their association with the company. Some of the benefits and
club membership are mentioned below which give the advisors fame and recognition.

33
Achiever’s Club:
Top 175 advisors of India will be eligible for the Achiever’s Club. Advisors will fly to a
different location abroad for ‘ICICI Prudential Life Insurance Convention’. Advisors
should be amongst the first 175 advisors from 1st April to 31st March. This year top 175
advisors are going to fly to ‘Greece’.

MDRT (Million Dollar Round Table):

Advisors become a member of prestigious MDRT. For this, advisors will get a certificate,
a plaque and various periodicals, which make advisors updated in their sale day by day.
Advisors can also be eligible to print MDRT logo on their visiting card. They can
communicate to the world that they are truly world-class professional advisors. For that,
an advisor has to collect the premium of Rs. 995000 or earn commission of 497500.

ICICI Pru Star Club:

Advisors will be eligible to earn business cards, letterheads, business allowance, office
support etc, which will help them organize their work in a professional manner. There

three sub clubs in ‘ICICI Pru Star Club’:

a. Platinum Club:If any advisor completes 150 policies and 850000 of premium
collection, he will become a ‘Platinum Club Member’
b. Gold Club:If any advisor completes 120 policies and 700000 of premium
collection, he will become a ‘Gold Club Member’.
c. Silver Club: If any advisor completes 80 policies and 450000 of premium
collection, he will become a ‘Silver Club Member’.

In the above-mentioned clubs, the advisors will be given points or run on their premium
collection amount. The benefits that advisors will get after becoming eligible for the
clubs are mentioned below:

Benefits Platinum Club Gold Club Silver Club

34
Business Card 1000 pcs 800 pcs 500 pcs

Personalised 1000 pcs 800 pcs 500 pcs

stationary

Personal Accident Rs.150000 Rs. 100000 75000

Policy

Certificate of Once a year Once a year Once a Year

Excellence

Momento Rs. 500 Rs.300 Rs.150

Sales Promotional Worth Rs.4000 Worth Rs. 3000 Worth Rs.2000

Item

Business Amount Rs.10000 pa Rs.7500 pa Rs.4000 pa

Office/Technology Rs.15000 pa Rs.12500 pa Rs. 10000 pa

Support

Lunch with CEO Once Every 6 Once Every 6 Months Once a year
Months

WHY YOU SHOULD BUY FROM ICICI PRUDENTIAL LIFE INSURANCE COMPANY
LTD.?

1. ICICI Prudential is the largest private player in the insurance in India.

2. They have sold over 10 lac policies till date.
3. They sell one policy every 1-minute.
4. They have collected premium of around Rs. 2500 crores.
5. ICICI Prudential is the first life insurance company to offer ECS debit facility.
6. ICICI Prudential is the first company to introduce unit linked life insurance
products.

35
7. ICICI was formed with formed by Govt. of India along with the World Bank and
the Indian industry.
8. ICICI is a 50 year old institution (est. 1955)
9. ICICI bank is the largest private sector bank in India.
10. Prudential is a 156 year old company (founded in year 1848)
11. It is one of the largest insurance companies in U.K.
12. It is the fifth largest insurance company (in terms of revenue in the world).
13. It enjoys AAA rating given by standard and Poor’s.
14. It offers life insurance and savings products to over 10 million customers in the
U.K.
15. In Asia, its U.K.’s largest life insurance company.
16. ICICI is India’s first company to be listed on NYSE.
17. It is also the first bank from non-Japan Asia to be listed on NYSE.
18. ICICI enjoys a rating with Moody’s, which is higher than the sovereign rating.
19. ICICI was the first company to pierce the sovereign rating given by Moody’s.
20. Mr. K.V.Kamath, the CEO of ICICI is the first Indian CEO to receive the Asian
Business leader award, hence the company is being led by a world-class leader.
21. They have a large network of more than 33,000 people selling life insurance in
India.
22. All the advisors have undergone the professional training of 100 hours
approved by IRDA.
23. ICICI enjoys the highest AAA credit rating, which ensures highest safety of
money.
24. Its equity shares are listed on stock exchanges at Chennai, Delhi, Kolkata,
Vadodara, Mumbai, NYSE and NSE.
25. In the year 2000,ICICI Bank was awarded the best bank award by global
finance media Inc.
26. Total assets of ICICI Bank are over Rs. 1 trillion.
27. ICICI made its first debenture issue in 1967 for Rs. 6 crores; the response was
overwhelming which led to over subscription.

36
28. In 1986, ICICI along with UTI set up CRISIL, India’s first professional credit
rating agency.
29. ICICI Venture funds management Company Limited is India’s largest venture
capital company.
30. Prudential ICICI mutual fund has emerged as one of the India’s largest mutual
funds, the corpus of the fund is over Rs. 6000 crores.
31. In 1912, Prudential promptly paid out claims to the families of 324 individuals
insured with Prudential who lost their lives in the TITANIC disaster.
32. It has a network of 540 branches and offices.
33. ICICI has been awarded the Best-presented Accounts award by ICAI for the
last three years.
34. Over forty lac investors have put in trust and invested in ICICI safety bonds.
35. The Bank has an account holder database of over 6 lacs.
36. ICICI has the largest ATM network in India.
37. They have more than 1800 ATMs and the number is still growing.
38. In 1999, it was awarded the Asian Banking Award by the Asian Banker’s
Association for record collections under the Resurgent India Bonds Scheme.
39. Both, ICICI Bank and Prudential are known for providing fast and accurate
customer service.
40. Prudential has over 75 years of experience in Asia.
41. ICICI Prudential is offering maximum products among all the major players in
the insurance industry.
42. ICICI has been associated with building up of renowned institutions like HDFC
and CRISIL.
43. ICICI was the second entity in India to set up merchant banking services.
44. ICICI Prudential offers a complete and diversified portfolio of products.
45. ICICI Bank is India’s first Internet bank and has always been the pioneer in
Information Technology.
46. Prudential offers financial services like insurance, banking, mutual funds,
pensions and general insurance.

37
47. Prudential has expanded its operations in Europe through strategic alliances
with other leading insurance companies in Europe.
48. In US, it operates under the name of Jackson national life which is one of the
largest life insurance companies in Europe.
49. Jackson national life is the number one provider of equity linked annuity
products in the U.S.
50. Prudential operates in 12 countries in India.
51. It has a vast network of 22 life and mutual operations in Asia.
52. ICICI Communities is a website for charities owned by ICICI and is managed
by its social initiatives group. Through SIG, they seek to define and effectively fulfill
responsibilities as a corporate citizen of India.
53. Prudential has signed a memorandum of understanding with China
International Trust & Investment Corporation to form a life insurance joint venture
partnership.
54. Prudential Asia deals in Life Insurance, pensions, banking, investment
management, mutual funds and general insurance.
55. It is particularly noted for pioneering unit-linked products in Singapore,
Malaysia and Indonesia.
56. Prudential is the first UK insurer to list its services on a mobile phone network
using the latest WAP technology.
57. Prudential is listed on the FTSE-100 in the UK.
58. ICICI received the Cyber corporate award by the economic times and
Microland Ltd. For making best use of internet for commercial purpose.
59. ICICI was the first ever-Indian borrower to raise European currency units in
1982.
60. They follow six-sigma quality standard, which is the highest quality standard.
61. ICICI was the first institution to receive ADB loans. First public issue by an
Indian entity in the Swiss capital markets in 1986.
62. ICICI promoted TDICI—India’s first venture capital company in 1988.

38
 63. ICICI promoted shipping credit and Investment Company of India Ltd.The
Corporation made a public issue of Swiss franc 75 million in Switzerland, the first
public issue by an Indian equity in Swiss markets.
64. ICICI signed a loan agreement for sterling pound 10 million with Common
wealth Development Corporation, the first loan by CDC for financing projects in
India.
65. ICICI became the first company in the Indian financial sector to raise GDR.
66. ICICI was ranked third best employer in campus track study amongst students
of best business schools in India conducted by ORG MARG in 2002.
67. ICICI Bank’s website featured amongst the best 15 web sites in the world,
reviewed by Forbes global in 2000.
68. Best CEO award for innovative HR practices to Mr. K. V. Kamath (CEO) by
world HRD Congress in year 2000.
69. ICICI Ltd. Also received National HRD network award 200 for innovative HR
practices.
70. ICICI Bank is now the parent company for:

 ICICI Venture
 ICICI Limited
 ICICI Securities
 ICICI Prudential Life Insurance Company
 ICICI Web trade
 ICICI PFS
 ICICI Capital
ICICI InfoTech

39
Chapter 2

INTRODUCTION TO THE COMPANY

INTRODUCTION TO THE COMPANY

40
ICICI (Industrial Credit and Investment Corporation of India):

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 thus far financed all the major sectors of the economy, covering 6,848
companies and 16,851 projects. As of March 31, 2000, ICICI had disbursed a total
of Rs. 1, 13,070 crores, since inception.

Organizational structure of ICICI

1. COMPANY

Under this topic, the major headings that will be covered are as under:

41
  Historical Background
 Mission & Vision
 Promoters
 Holdings
 Equity structure
 Organization structure
 Departmentation
 Details of division heads
 Financial performance of the company

• HISTORICAL BACKGROUND

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, and
Prudential Plc, a leading international financial services group which has its
headquarters in U.K.ICICI Prudential was amongst the first private sector companies to
begin operations in December 2000 after receiving approval from Insurance Regulatory
Development Authority (IRDA). ICICI Prudential’s total equity is 6.75 Bn with ICICI Bank
& Prudential Plc. In the end of year 2003-04, ICICI Prudential had issued over 7.8 lacs
policies, for a total sum assured of over 16000 crores and premium collection is over
951 crores.

The company has a network of about 33000 advisors: as well as 12 bancassurance tie-
ups. Today the company stands first in private life insurance in India with a market
share of nearly 40%.

42
 VISION

The company’s vision is “to make ICICI Prudential the dominant Life and Pensions
player built on trust by world-class people and service.”

They hope to achieve this by:

 Understanding the needs of customers and offering them superior products and
service.

 Leveraging technology to device customers quickly, efficiently and conveniently.

 Developing and implementing superior risk management and investment

strategies to offer sustainable and stable returns to their policyholders.

 Providing an enabling environment to foster growth and learning for their

employees.

 And above all, building transparency in all their dealings.

The success of the company is due to its unflinching commitment to 5 core values-

• Integrity,
• Customer First,
• Boundaryless,
• Ownership,
• Passion.

43
 Each of the core values describe what the company stands for, the qualities of their
people and the way they work.

PROMOTERS

The promoters of ICICI Prudential Life Insurance Company are: ICICI Bank and
Prudential Plc .ICICI and Prudential came together in 1993 to form Prudential ICICI
Asset Management Company, which has today emerged as one of the leading mutual
funds in India. The two companies bring together two of the strongest financial service
brands in Asia, known for their professionalism, excellent quality of service and long
term commitment to THEIR CUSTOMERS.

ICICI Bank has 74% stake in the company, and Prudential Plc has 26%.

ICICI BANK

 ICICI Bank is India’s second-largest bank with total assets of about Rs.132,780
crores at September 30,2004 and profit after tax of Rs.873 crores in the half year
ended September 30,2004(Rs.1,637 crores in fiscal 2004).
 ICICI Bank has a network of about 540 branches and extension counters and
over 1800 ATMs.
 ICICI Bank offers a wide range of banking products and financial services to
corporate and retail customers through a variety 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 and asset
management.

44
  ICICI Bank set up its international banking group in fiscal 2002 to cater to the
cross-border needs of clients and leverage on its domestic banking strengths to
offer products internationally.
 ICICI Bank currently has subsidiaries in United Kingdom and Canada, branches
in Singapore and Bahrain and representative offices in the United
States,China,United Arab Emirates and Bangladesh.
 ICICI Bank’s equity shares are listed in India on the Stock Exchange, Mumbai
and the National Stock Exchange of India Limited and its American Depository
Receipts (ADRs) are listed on the New York Stock Exchange (NYSE).

PRUDENTIAL PLC

 Established in London in 1848, Prudential Plc, through its businesses in the UK

and Europe, the US and Asia, provides retail financial services , products and
services to more than 16 million customers, policyholders and unit holders
worldwide.
 As of December 2003, the company had over US $300 billion in funds under
management.
 Prudential has brought to market an integrated range of financial services
products that now includes life assurance, pensions, mutual funds, banking,
investment management and general insurance.
 In Asia, Prudential is UK’s largest life insurance company with a vast network of
23 life and mutual fund operations in twelve countries-China,
HongKong,India,Indonesia,Japan,Korea,Malaysia,thePhilippines,Singapore,Taiw
an, Thailand and Vietnam.
 Solid reputation built over 150 years.

45
  Insurance and investment funds under management exceed Rs 11,00,000
crores.
 Already established as one of the biggest private sector mutual fund companies
in India. (Prudential ICICI AMC.)
 A truly global brand.

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.

46
 T H E P R IV A T E L IN E U P

1 3 .5 1 5 .2
5 .5
7 .8 3 .1
7 .4
1 .8
3 7 .1 0 .6
0 .5
1 .3 6 .1

B irla S un L ifeA llia nz B a ja j

O m K o ta k S B I L ife ING V y s y a
M e t L ife A M P S a nm a rT a ta A IG
A V IV A L ife IC IC I P ru M a x NY L
HD F C S ta nd .

47
TODAY IN THE LIFE INSURANCE MARKET THERE ARE 13 PLAYERS AND TOTAL
149 VARIOUS PLANS AVAILABLE.

Total Premium U/W Total No. of PoliciesAverage Premium

Insurer Issued Per Policy

Feb-04 Apr-Feb 04 Feb-04 Apr-Feb 04 Feb-04 Apr-Feb 04

1 ICICI 11900 57714 79752 340511 14922 16949

2 TATA AIG 2754 14287 16368 136990 16826 10429

3 OM KOTAK 974 6961 4789 38925 20328 17882

4 BIRLA SUNLIFE 5248 24752 19792 112254 26514 22050

5 MAX NEW YORK 1420 10518 18137 117351 7830 8963

6 ING VYSYA 682 4517 8415 59225 8102 7627

7 HDFC 2218 15002 19058 167769 11639 8942

8 MET LIFE 269 1828 2912 19497 9225 9377

9 ALLIANZ BAJAJ 2008 11397 17168 142536 11694 7996

SBI 2037 11617 10025 60121 20315 19323

48
10

11 AVIVA 944 5935 7558 56478 12492 10509

12 AMP SANMAR 264 2100 3105 36843 8506 5700

SUB TOTAL 30718 166628 207079 1288500 14833 12932

13 LIC 159078 1137127 2570814 19341707 6188 5879

GRAND TOTAL 189796 1303755 2777893 20630207 6832 6320

49
 Market Share of Private Players in Terms of Premium Upto Feb'04

4% 1% 9%
7% 4%

15%

34% 6%
3%
9%
7% 1%

ICICI PRUDENTIAL SBI

AVIVA AMP SANMAR
ALLIANZ BAJAJ OM KOTAK
BIRLA SUNLIFE MAX NEW YORK
ING VYSYA HDFC STANDARD
MET LIFE TATA AIG

50
 Market Share of Private Players in Terms of No.Of Policies upto
Feb ' 04

4%
3%
5% 11%
25% 3%
9%
9%
11% 2%
13% 5%

ICICI PRUDENTIAL SBI

AVIVA AMP SANMAR
ALLIANZ BAJAJ OM KOTAK
BIRLA SUNLIFE MAX NEW YORK
ING VYSYA HDFC STANDARD
MET LIFE TATA AIG

• HOLDINGS

51
ICICI Bank and Prudential plc came together in 1993 and formed Prudential ICICI Asset
Management Company. ICICI Bank has 74% stake in the company, and Prudential plc
has 26%.

• EQUITY STRUCTURE

ICICI Prudential’s equity base stands at Rs.925 crores. In the quarter ended June
30,2004,the company issued over 1,00,000 policies, for a total sum assured of over Rs.
3,753 crores and had a new business premium income of Rs. 242 crores. The
company’s market share is 36% among private insurance players.

• ORGANIZATION STRUCTURE, DEPARTMENTATION AND DETAILS OF

DIVISION HEAD

The CEO and Managing Director of ICICI Bank, Mr. K.V. Kamath is the Chairman of
ICICI Prudential Life Insurance Company. The structure is as follows:

Organization Chart – Head Of Management Team:

52
 Ms. Shikha Sharma
- MD

Mr. Shubhro Mitra Mr. Sandeep Batra, Mr.Shridhar

Chief - HR CFO - CS Chief Sales &
Mkt.

Mr. V.Rajagopalan Mr. Anil Tikoo

Mr. Puneet Nanda
Appointed Actury Head –Info. Tec.
Head -
Investment

Ms. Anita Pai-

Chief ope. & Und.

The ICICI Prudential Life Insurance Company Limited Board comprises of reputed
people from the finance industry both from India and abroad.

 Mr. K. V. Kamath, Chairman

 Mr. Mark Norbom
 Mrs. Lalita D. Gupte
 Mrs. Kalpana Morparia
 Mrs. Chandana Kochhar
 Mr. Kevin Holmgren
 Mr. M. P. Modi
 Mr. R. Narayanan
 Ms. Shikha Sharma, Managing Director

Ms. Shikha Sharma, Managing Director, is responsible for all the operations of the
company. She started her career in ICICI in 1980 and has worked in various divisions of
ICICI like Project Finance, Corporate Planning and Resource Raising. From 1992-

53
1997,she was involved in setting up of ICICI Securities, a Joint venture between ICICI &
JP Morgan. In April 1997, she became the General Manager, Strategic Planning and
Policy department and Information Technology.In August 1998, she was appointed the
Senior General Manager of ICICI Personal Financial Services Ltd., and was responsible
for all the retail asset products of the company.

Ms. Shikha Sharma, has done her B.A. (Hons.), Master of Business Administration from
the Indian Institute of Management,Ahmedabad and a Post Graduate Diploma in
Software Technology, from the National centre for Software Technology, Mumbai.

The various departments in the organization are:

1. The Human Resource Department

2. Investment Department
3. Customer Service and Operations Department
4. Information Technology Department
5. Strategy Department
6. Marketing Department.

54
FINANCIAL PERFORMANCE OF THE COMPANY

ICICI Prudential was amongst the first to identify the first to identify the emerging
opportunity in the Pension segment and launched two linked pension products-Life Time
Pension and Life Link Pension, which have been well received in the market.

A summary of the financial performance of ICICI Prudential Life insurance is as follows:

(Rupees in million)
Particulars for the period ended March 31,2003

2003 2002
Premium Income 4176.00 1163.00
Other Income 120.60 220.71
Total Income 4424.00 1193.71
Expenditure 8.63 11.07
Net Profit/(Loss) (1471.82) (1050.98)
Share Capital 4250.00 1900.00

Source:

http://www.icicibank.com/pfuser/aboutus/newsroom/presskit/iciciprudential.htm

2. PRODUCTS AND SERVICES

55
The topics covered under this are:

 Product Mix
 Product Life Cycle
 Pricing
 Promotion Strategies
 Segmentation and positioning strategies
 Communication strategies and media analysis
 Distribution and channel management
 Technology

56
 PRODUCT MIX

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

that meet the needs of customers at every life stage. Its 19 products are combined with
up to 6 riders, to create a customized solution for each policyholder. The company
provides insurance solutions for both individuals as well as groups.

The insurance solutions for the individuals are:

Savings Solutions

1. Secure Plus is a Transparent and feature-packed savings plan that offers 3

levels of protection.

2. Cash Plus is a transparent and feature-packed savings plan that offers 3 levels
of protection as well as liquidity options.

3. Save “n” protect is a traditional endowment savings plan that offers life
protection along with the adequate returns. This policy falls under the category of
endowment policy. The policy-holder gets the sum assured and bonuses on
survival. Unlike the cash back policy, there are no guaranteed bonuses here. The
novel feature of the policy is that the policy holder is covered for life for 50 per
cent of the sum assured for five years beyond the maturity date.

4. Cash Back is the policy which is ideal for meeting milestone expenses like
children’s marriage, their higher education or to purchase any other asset.ICICI
Prudential’s cash back policy is structured on the lines of the money back policies
offered by LIC and others in the field. Simply put, the policyholder gets regular
returns at pre-determined intervals and the sum assured and bonus at the end of
the period. ICICI Prudential’s cash back policy has an interesting feature, in that,
the company offers a guaranteed bonus .LIC is regarded as an exception of sorts

57
 because the entity’s track record of bonus gives one a fair idea of what can be
expected. ICICI Prudential claims to be the only one offering a guaranteed bonus
in addition to another bonus that is contingent on the returns the company
generates on investment.

Protection Solutions

LifeGuard is a protection plan, which offers life cover at very low cost. It is available
in 3 options- level term assurance, level term assurance with return of premium and
single premium. The company offers two pure life insurance products that have an
umbrella name, Life Guard. One of them involves a one-time premium for which
there are no maturity benefits. The other requires regular premium payments that
are returned at the end of the policy. Life Guard offers absolutely no investment-
related return and is suitable for individuals looking for an unadulterated insurance
package.

58
 Child Plans

SmartKid education plans provide guaranteed educational benefits to a child along

with life insurance cover for the parent who purchases the policy. The policy is
designed to provide money at important milestones in the child’s life. Smartkid plans
are also available in unit-linked form-both single premium and regular premium.

Market-linked Solutions

1. Life Link II is a single premium Market Linked Insurance Plan that combines
life insurance cover with the opportunity to stay invested in the stock market.

2. Life Time II offers customers the flexibility and control to customize the policy
to meet the changing needs at different life stages. It offers 4-fund options-
Preserver, Protector, Balancer and Maximiser.

3. Premier Life is a limited premium-paying plan that offers customers life

insurance cover till the age of 75.

Retirement Solutions

1. Forever Life is a retirement product targeted at individuals in their

thirties.

2. SecurePlus Pension is a flexible pension plan that allows one to select

between 3 levels of cover.

3. LifeTime Pension II is a regular premium market-linked pension plan.

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 4. LifeLink Pension II is a single premium market-linked pension plan.

ICICI Prudential also launched “Salaam Zindagi”, a social sector group insurance policy
targeted at the economically underprivileged sections of the society.

The policies for groups are:

ICICI Prudential also offers Group Insurance Solutions for companies seeking to
enhance benefits to their employees. They are:

1. ICICI Pru Group Gratuity Plan: ICICI Prudential’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.

2. ICICI Pru Group Superannuation Plan: ICICI Prudential offers a flexible

defined contribution superannuation scheme to provide a retirement solution for
each member of the group. Employees have the option of choosing from various
annuity options or opting for a partial commutation of the annuity at the time of
retirement.

3. ICICI Pru Group Term Plan: ICICI Prudential’s flexible group term solution
helps provide affordable cover to members of a group. The cover could be
uniform or based on designation/rank or a multiple of salary. The benefit under
the policy is paid to the beneficiary nominated by the member on his/her death.

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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. Most of the riders come with the
traditional money back and endowment policies and the flexibility here may well be the
USP of the latest generation of insurance products.

ICICI Prudential’s riders are meant to cover accidents, critical illness, assistance for
major surgeries and a desire to double the insurance cover during the life of the policy.

The concepts underlying the riders offered by different companies are similar.
Therefore, any interested person will have to take a close look at the fine print; a
difference here could make all the difference.

The major advantage of the riders offered by ICICI Prudential, as well as its competitors,
is that a policyholder has the flexibility to mix and match the rider according to
requirements, and thereby avoid paying for benefits one does not need.

1. Accident and disability Benefit: If death occurs as the result of an

accident during the term of the policy, the beneficiary receives an additional
amount equal to the sum assured under the policy. If the death occurs while
traveling in an authorized mass transport vehicle, the beneficiary will be
entitled to twice the sum assured as additional benefit.

2. Accident Benefit: This rider option pays the sum assured under the
rider on death due to accident.

3. Critical Illness Benefit: This protects the insured against financial

loss in the event of 9 specified critical illness. Benefits are payable to the
insured for medical expense prior to death.

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4. Income Benefit: This rider pays the 10% of the sum assured to the
nominee every year, till maturity, in the event of the death of the life
assured. It is available on Smartkid, SecurePlus and CashPlus.

5. Waiver of Premium: In case of total and permanent disability due to

an accident, the premiums are waived till maturity. This rider is available
with SecurePlus and CashPlus.

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 PRODUCT LIFE CYCLE

The Insurance industry is just in the introduction stage. So the company’s product
stands in the introduction stage. It will still take two three years to reach break even
point for the company.

• PROMOTION STRATEGIES

Over the last few months, ICICI Prudential has been advertising in outdoor, TV and
press. The company launched a corporate television campaign-Saat Phere-which took
the emotions and thoughts of initial Sindoor corporate film a few steps further. The film
highlights the strength of promises that a husband makes to his wife, through the
depiction of everyday situations, and then goes on to emphasize that ICICI Prudential
will stand by the husband to help him fulfill all these promises. The TV campaign has
also been extended to outdoor.

The company has also undertaken press and internet campaigns to inform customers
about benefits of some of its products, particularly retirement solutions, through the
Chintamani campaign.

After the hugely successful Chintamani(retirement) and Saat Phere(corporate)

campaigns, ICICI Prudential Life Insurance also introduced some innovations in the
category, such as: having a tax planner by the name of Chintamani on radio, who would
answer consumer’s queries about the role of insurance in financial planning.

Other initiatives included tie-up with the Dabbawala Organization in Mumbai for a direct
marketing exercise, to talk to the customer through a non-cluttered route, and thereby
have a higher impact. The direct mailer was about ICICI Prudential’s retirement
solutions and the tax benefits that one can avail of buy investing in any of these. About

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1, 00,000 direct mailers were attached to the ‘dabbas’, in areas such as Churchgate,
Bandra and Andheri where there are mostly office-goers.
In addition to advertising, the company has also initiated several activities to raise
consumer awareness about life insurance and ICICI Prudential. It includes seminars-
ICICI Prudential regularly holds consumer awareness meets on ‘the need for retirement
planning’ in different cities such as Pune, Aurangabad, Coimbatore, Nagpur, Bangalore
and Mangalore. These are very well attended and have contributed significantly towards
increasing awareness about the category and the company. Apart from this, they have
also entered into alliances with telecom companies, as well as companies like BPCL
and Dominos.

The company also sets up stalls at various vacation fairs or events. Not only that, last
year they had set up a camp where they offered free check-ups for blood pressure and
blood tests.

• SEGMENTATION AND POSITIONING STRATEGIES

At a broad level, ICICI Prudential aims to secure the families of the middle and
upper class working people in urban and rural India. Their strategy has always been
to focus on delivering value and convenience to the customer, whether they are in
the rural or urban areas. Hence, in urban areas they have focused on offering
product choice and flexibility and building easy access for the customers; while in
rural areas the focus is on partnering with NGO’s and grass-root organizations and
offering a simple product that can be understood by the customers.

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 COMMUNICATION AND MEDIA ANALYSIS

ICICI Prudential’s success has been built on its consistent focus on the customer
and delivering on his/her needs. This includes several initiatives, such as:
• Developing flexible products that are based on consumer needs and insights.

• Offering differentiated service to the customer in a manner that is most

• Convenient to him/her-be it through the web, call centres, branches, etc.

• Scientific risk management.

• Investment strategy with a focus on safety, stability and returns are some of the
factors that have facilitated their growth.

Since its inception, ICICI Prudential has invested in building a meaningful brand in
the mind of its customers. These efforts have borne fantastic results, with the
company enjoying total brand awareness scores of 92%, the highest among private
life insurers.

The Marketing function at ICICI Prudential covers many activities-

• Brand and media management,

• Channel support,
• Direct marketing and
• Corporate communications.

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The Brand and Communications team is in charge of advertising, consumer research,
media planning & buying and Public Relations; that helps in developing and nurturing
ICICI Prudential’s corporate identity while effectively communicating its varied product
offerings to the customer. Channel marketing provides support to the sales force by
providing streamlining the design and development of collaterals and sales tools across
distribution channels. The Direct Marketing team was set up to generate high quality
leads for profitable business. The team achieves this through target database
acquisition and communicating customized product information through e-mailers,
telemarketing and innovative direct mailers.

ICICI Prudential Life Insurance has shifted its Rs.200 million media planning and buying
account from Initiative Media to Mindshare. Apart from Mindshare and Initiative Media,
there were three other agencies in the final round. ICICI Prudential Life Insurance,
head-marketing, Abhishek Bhatia had short listed five agencies in a second round, to
test their media planning in terms of tools and applications and creativity in terms of
their usage before opting for Mindshare.

In all, nine agencies were invited in the first round. The new agency will handle the TV,
print, cinema, radio and other mass media buying for ICICI Prudential. Lowe continues
to work on the creative business while Ogilvy Landscapes handles outdoor
advertising.

The main aim of the company is that they are looking for agencies, which can go
beyond tools and techniques in terms of rigorously using them, and implementing a
robust monitoring system (for efficiency in terms of planning and execution of the plan
devised). Also, they should have some expertise in handling the banking, financial
services and insurance category. The company also looks at the capability to go beyond
TV, outdoor and print.

66
67
DISTRIBUTION AND CHANNEL MANAGEMENT

The company has the highest distribution network having 75 branches across 45
locations. It is the only company to do 1 million policies. In keeping with its philosophy of
giving the customers choice in how they want to approach the company, ICICI
Prudential was the first life insurer to launch operations with a multi-channel
distribution strategy that included:

• Advisors
• Bancassurance
• Corporate agents
• Direct marketing
• And most recently, its online application system-Insta Insure.

Also this is the only company to have a tie-up with Indian Post Office.

The company has a network of about 40,000 advisors and 33,000 agents, which
contribute the greatest percentage of business. Alternate channels such as corporate
agents and bank relationships contributed nearly 30% of business in 2004.

ICICI Prudential has one of the largest distribution networks amongst private life
insurers in India, having commenced operations in 62 cities and towns in India. These
are: Agra, Ahmedabad, Ajmer, Allahabad, Amritsar, Aurangabad, Bangalore, Bareilly,
Bhatinda, Bhopal, Bhubaneshwar, Chandigarh, Chennai, Coimbatore, Dehradun, Goa,
Guntur, Gurgaon, Gwalior, Hyderabad, Hubli, Indore, Jaipur, Jalandhar, Jamnagar,
Jamshedpur, Jodhpur, Kanpur, Karnal, Kochi, Kolkata, Kolhapur, Kota, Kottayam,
Kozhikode, Lucknow, Ludhiana, Madurai, Mangalore, Meerut, Mumbai, Nagpur, Nasik,
Noida, New Delhi, Patiala, Pune, Raipur, Rajkot, Ranchi, Rourkela, Siliguri, Surat,
Thane, Thrissur, Trichy, Trivandrum, Udaipur, Vadodara, Vashi, Vijaywada and Vizag.

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The company has 11 bancassurance tie-ups, having agreements with ICICI Bank,
Federal Bank, South Indian Bank, Bank of India, Lord Krishna Bank, as well as some
co-operative banks like Punjab and Maharashtra Co.- operative Bank, Goa State Co. –
operative Bank. Indoor Parraspar Sahakari Bank, Manipal State co. operative Bank,
Shamrao Vithal Co-operative Bank and Jalgaon Peoples co. operative Bank and
corporate agents. Allahabad Bank was having agreement with ICICI PRUDENTIAL till
May 2004. Now it has joined to SBI Life Insurance. It has also tied up with organizations
like Dhan for distribution of Salaam Zindagi, a policy for the socially and economically
underprivileged sections of society.

Bancassurance:
Bancassurance in its simplest form is the distribution of insurance products through a
bank's distribution channels. In concrete terms bancassurance, which is also known as
Allfinanz - describes a package of financial services that can fulfill both banking and
insurance needs at the same time. The motives behind bancassurance also vary. For
banks, it is a means of product diversification and a source of additional fee income.
Insurance companies see bancassurance as a tool for increasing their market
penetration and premium turnover. The customer sees bancassurance as a bonanza in
terms of reduced price, high quality product and delivery at doorsteps. Actually,
everybody is a winner here.

Brief Detail of some Bancassurance tie-ups With Company:

(1) Allahabad Bank :

Allahabad Bank is the oldest public sector Bank in India having branches all
over India serving the customers since 1865. They entered into and

69
 insurance tie up with us in September last year and have never looked back
since then.

Dr. B.Samal, ex-Chairman and M. D, Allahabad Bank, on the tie up with

ICICI Prudential:

“This strategic alliance with the ICICI Prudential Life is an extension of our
philosophy to provide a complete range of financial solution to our customers.
By trying-up with India’s leading private life insurer, we can assured our
customers of not only a complete innovatively designed product range, but
also excellent services.”

Allahabad Bank has recently joined up with LIC.

(2) Bank Of India :

One of the large public sector Banks entered into bancassurance tie up with
us a year a halfback. Since last year we have expanded three folds. But “this
is just a beginning” in the words of Executive Director, Mr. O. N. Singh. He
said we have started earning. The income form these areas may not be
substantial, but it is a net addition. We are making it without incurring even a
single penny of additional expenditure. Developing capabilities is as important
as making profits. The profits from these areas may be 20 Crores this year.
Once our staff learns to sell insurance and mutual fund products, we should
be able to earn many times more than that amount.”

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(3) Federal Bank:

Fed-ICICI Pru is an enviable partnership for any bank or an insurance

company. According to Chairman Shri K. P. Padmakumar, the bank foray into
bancassurance is logical extension of their desire to convert themselves into a
complete financial service provider and hence their tide up with the No. 1
insurance company. Going forward federal has ambition to transform itself
into one of the largest distributors of life insurance and pension products.

According to Federal Bank chairman Shri. K. P. Padmakumar, “The

bancassurance arrangement between to leading organizations presents
several mutually beneficial advantages. While ICICI Prudential gets the
benefit of a larger distribution network, Federal Bank is able to improve the
range of financial products and services that it can offer to its customers.
Insurance company also benefit from strong personal trust and bondage that
branch managers have built with their customer base over the years.

(4) ICICI Bank :

ICICI Bank is our oldest and largest partner and the pioneer bancassurance in
India. With a multichannel distribution approach where insurance is woven
into delivery channel of the bank, this is India’s most advanced
bancassurance model. M. S. Chanda Kochhar, Executive Director ICICI
Bank, in recent interview with prudential corporation, discussed the ICICI
Bank experience with bancassurance.

M. S. Chanda identified the portfolio of innovative products, a multi channel

distribution network and the ability to do pioneer paradigm initiatives as some
of the strengths of ICICI Prudential.

71
 She mentioned specifically the “salary account” and the “private banking”
channels where we have been doing business together and have a good
business potential in future as well M. S. Chanda dwelt on the strengths,
especially the vast multichannel distribution network and the consumer
franchise that ICICI Bank enjoys in India, and how it is supplemented by the
knowledge and expertise of prudential life insurance business.

(5) Lord Krishna Bank:

Lord Krishna Bank is another one of our partners based in Kerala. Starting
with 7 branches in Kerala, the tie up has now extended to 50 plus branches in
the last 8 months.

Mr. S. R. Sinha, Senior Vise- President, Lord Krishna Bank on the tie up with
ICICI prudential. “The concept of bancassurance is an excellent fit with Lord
Krishna Bank’s strategy to become a new- age bank that imbibes the spirit of
change and innovation. As a new avenue of growth, it enables the bank to
expand its service range to its valued customers and provides an additional
revenue stream to the bank. The goodwill and strong client base of Lord
Krishna Bank and ICICI Pru. Life’s expertise in the life insurance business is
sure to make tie up a success story.”

(6) South Indian Bank:

One of our oldest relationships, going for ward wishes to make insurance as
one of the key contributor towards bank‘s fee based income. After having
established the referralm, odlin, Kerala, SIB now has plan to step up business
by including regions outside Kerala under its focus and provide the require
inputs.

72
Shri. A. Sethum A.Dhavan, Chairman & CEO of The South Indian Bank Ltd
says “Bancassurance is the most preferred distribution channel for life
insurance products the world over. Indian banks are replicating this model with
great expectations to augment their income stream. SIB considers this more
as an alternative product that can be offered to its customers as a part of its
plan to offer variety of financial products and service all under one roof. We
have successfully completed a full year of fruitful relationship ICICI Prudential
in marketing its life insurance products under a referral arrangement.”

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 CORPORATE AGENTS

ICICI Prudential has tie up with Corporate Agents. Some them are as under :

(1) Access Hospitality Services :

The top performing corporate agents from Punjab have been with us for one
and a half years. AHS started by husband and wife couple of Sanjeev Sharma
and Sangeeta Sharma a nine years ago, entered in to a partnership with ICICI
Prudential in Dec. 2001, with help of their excellent sales practiced and
execution they have done very well since then. Today they are one of the
leading corporate agents of ICICI Prudential.

(2) Advance Financial Services :

AFS has been our partner for over a year now. Advance Financial Services is
part of the Karvy Group, one of the India’s leading financial services
companies. Karvy’s strong work ethic and professional background,
leveraged with information technology enable it to deliver quality to individual
customers. This synchronizes with ICICI Prudential mission of offering the
best advise to Indian consumers for life insurance and retirement solutions.

(3) Bajaj Capital Services:

Bajaj Capital are one of India’s fore most merchant bankers, investment
advisors and financial planners for the last 37 years and have had the honor

74
 of helping millions of investors achieve their life’s goals. Bajaj Capital Services
is a one stop financial supermarket and today provides ICICI Prudential
solution through specially trained consultants at its outlets across the country.

(4) Bluechip Online:

Bluechip and ICICI Prudential shared a mutually rewarding journey with their
strong presence in Mumbai and long lasting customer relationships, bluechip
has shared synergies with the distribution philosophy of ICICI Prudential.
Bluechip have now taken the success of the insurance partnership in Mumbai
to its other branch location in India.

(5) India Infoline:

Mr. Atul Rastogi, Director India Infoline, say about their journey with ICICI
Prudential: “India Infoline was the first corporate agent for ICICI Prudential
and the relationship has gone from strength to strength in the last two and half
years. ICICI Prudential has been the industry leader in innovative products,
marketing campaigns and promotion, rewards and recognitions, which adds
notches to their productivity. Going forward they are confident that ICICI Pru’s
vision of being the leading player in pension and insurance industry will be
met and India Infoline will be significant contributor in the same.

(6) Way 2 Wealth:

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Way2weath is a premier investment consultancy firm that has been
launched with aim of making investing simpler, more understandable and
profitable for the investors.

In line with way2wealth’s mission “ to be the pre-eminent destination for

personalized financial solutions helping individuals create wealth”, it has
partnered with ICICI Prudential to offer life insurance and retirement solutions
through over 40 easily accessible investment outlets spread across 20 major
towns and cities in the country.

76
 Direct Marketing

ICICI Prudential also markets for its products though different ways like telecalling, mail
etc. As mentioned about branch network of ICICI Prudential above, they all are having
their staff that is involved in direct marketing for its product.

Distribution Strategy of ICICI Prudential

Bancassurance & Alliances

Tied Agency

Bancassurance 20
%

Corporate Agency & 10

Brokers %

Direct Marketing

70
%

Agency Force

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Tied Agency
In life insurance business wide distribution network and tied agency is biggest
source of getting more business for any company so developing them is key to increase
share in the life insurance market. LIC has 10,02,149 agents and 2048 branch offices as
on 31st march 2005.
Tied agency is a substantial business channel for ICICI Prudential because 70%
of business of company comes from this channel. Company provides agency to
individual whose age is between 25 to 40 years and, minimum qualification is 12 th pass.
As we have seen, company’s major business comes from this channel. ICICI Prudential
is immensely concentrating on developing this channel. It has 33,000 advisors and it is
planning to extend this number to 54000 by the end of the year 2004 – 2005. For that,
ICICI Prudential does many activity like they do direct marketing, they recruit
management trainees on fulltime project, they hold seminars, they also keep stall in big
events for developing that channel. Unit managers provide major support in developing
this channel. Unit manager’s target is to recruit 30 advisors in 5 – 6 months time. Unit
managers have around 25-30 advisors, who are recruited by them.

ICICI Prudential provides lots of benefits to the advisors like flexibility in timing,
different motivation factors like money, foreign trips, career building programs
permission to access office etc. Company called its offer to business opportunity for
individual. People who accept companies business offer and complete 100 hours
training of IRDA for getting license to do business of life insurance, they call them
advisors of ICICI Prudential.
The project given to the management trainess involves developing business
channels called Tied Agency. I did this task for sixteen weeks. I adopted various
techniques for Data Collection which are discussed later in the methodology section
.Apart from this, we were also given an opportunity to present new and develop some
creative ideas in order to target HNIs. We came out with some creative ideas like
distributing scratch cards at departmental stores, petrol pumps etc. and we also fixed up
the limit of money spent by the people so targeted only the higher segment.

78
ICICI Prudential has recruited and trained over 33,000 insurance agents to interface
with and advise customers. Further, it leverages its state-of-the-art IT infrastructure to
provide superior quality of service to customers.

The company also realized that backward areas like Andhra Pradesh are not aware of
insurance and insurance companies have a limited reach. So, ICICI Prudential has also
started providing services here to ITC e-Choupals. Sanchalak is the referral agent and
each sanchalak has sold almost 1-27 policies in the pilot phase. There are 90 kiosks in
the pilot phase and 1500 kiosks have been proposed. Also ICICI Prudential along with
ICICI Lombard has launched n-Logue kiosks in Madurai. Kiosk operator is the referral
agent.

The following table shows the way the company has grown from 2001 to 2004:

Financial Year Cities Branches

2002 11 11
2003 24 29
2004 54 70

TECHNOLOGY

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To see how successful the company is in reaching out to its customers, it is necessary
to see the technology initiatives of the company. It is a kind of communication channel,
but it is put in this head as it deals exclusively with technology.

With over 26 branches spread across the country, Prudential ICICI found it imperative to
have a system in place to connect each branch with the main office in Mumbai.

Previously the company used to rely on a Fox Pro database. But the system was not
flexible enough to serve the needs of a rapidly growing organization. Bureaus across
the country used to photocopy the applications received by customers and then courier
it to the Mumbai office. The applications were scanned and then entered into the
database. The quality audit took place 2-3 days after the application was received. The
final account statement was created after the quality audit. There was a 7-10 day gap
because of this process leading to a longer turnaround time per application. Customers
who wanted redemption within a week faced a problem with this system. Also, if a
particular office received more than the usual number of applications it used to increase
the load on the system as well as the personnel, which in turn led to delays in
transactions.

Another area that required smoothening out involved the dispatch of statements to the
customer. Earlier around 60-100 statements were printed everyday and were then faxed
to the customers. This was not only time consuming but expensive as well, as each
statement ran into minimum of three pages. Also, valuable human resources were
occupied in non-productive work like redialing the fax number in case the receiver was
busy at the other end.

The solution to this issue

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The priority was to implement a centralized database. Data is entered through the front-
end tool PowerBuilder, which is now getting phased out and replaced by a client/ server
based system. Prudential ICICI now uses Oracle for taking care of its backend needs.
With the centralized database, if there is an overload of applications received in any
particular branch, then the central pool of people in Mumbai distributes the load. The
extra load is diverted to the area where the resources are relatively free. 20 of the 26
branches have been connected via a leased line. The backbone supporting the network
is that of parent company, ICICI Bank. Hence, each Prudential ICICI Branch is
connected to the local ICICI Bank’s LAN network. The centralized database has helped
the company in providing better customer service. Now, a customer is not attached to
any particular branch. They can get their queries answered from any branch in the
country.

The branches no longer courier the applications to the Mumbai office. The details are
entered into the system on the same day using Hummingbird, which has been
customized to suit the company’s needs. The advantage of the system is that along with
the data even the image is now available for viewing and verification. Hummingbird has
made it possible for the company to capture and index paper-based documents and
manage them in tandem with the electronic content. Digitisation of the content has
made it possible for users to enjoy immediate access to critical resources. Document
metadata and text-based image content is captured and indexed to support user
queries, and the way images are shared and revised have been fine-tuned with flexible
security controls.

Due to the immediate availability of details in the application, the quality audit now
happens on the same day. This has reduced the turnaround time to 24 hours.

Cost cutting and operational efficiency

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Prudential ICICI has developed RightFax faxing solution for handling faxing
requirements. Close to 100 final statements are prepared and faxed each day, with
each statement running into at least 2-3 pages. The automation of this process has
resulted in tremendous cost savings for the company.

Prudential ICICI has been able to bring about greater efficiency in sending and receiving
documents electronically from desktops, e-mail, and other business applications by
integrating fax, e-mail and Internet technologies. Information like history file, name of
sender, time sent, destination address, billing code/s, etc. are also readily available with
this system. Security has been enhanced as incoming faxes can be routed immediately
to the addressee’s mailbox by direct selection on arrival (DSA). Outgoing faxes are sent
during off-peak hours to lower operating costs. Transmission is also faster than manual
faxing.

Digitisation has also enabled the ASA to cut down on cost of photocopying each
transaction for storage purposes. The bank conducts between 800-1200 transactions
per day on an average. Each transaction takes up at least three pages. This results in
the generation of a lot of paper. Now with all transactions stored online, the company
has seen a tremendous reduction in paper wastage as well as in the cost of
photocopying each page. Searching has also been made easier and human resources
are now free for handling core activities.

Call centre facility

The company has also introduced call centre facilities for its customers in Mumbai. This
is one facility, which is currently unique in the mutual fund industry in India. Now,
customers can conduct redemption and purchase over the phone. As a separate call
centre is not a feasible option the company has integrated its system with the ICICI
Bank call centre in Mumbai.
Website

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The Pru ICICI website provides a phenomenal amount of educational material related to
mutual funds and the products on offer. Currently, there are 1,500 people registered for
online transactions. The company is planning to add more payment gateways to make it
possible for each customer to access information related to his account over the net.

HR PRACTICES

The topics covered under this are:

 HR Mission
 Recruitment and Selection
 Performance Management
 Compensation and Reward
 Innovation in HR Practices
 Training and development

HR MISSION

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.

RECRUIMENT AND SELECTION

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ICICI Prudential Life Insurance Company offers jobs to be either an advisor or an
employee. They believe that the advisors are the ambassadors to the customers. That
is why, they take a lot of care in recruiting and developing their advisor force, so that
they continue to set higher standards of quality in service and salesmanship. To cater to
the needs of the knowledge-oriented marketplace, the company looks for graduates
who are service-oriented, good communicators and enjoy meeting new people.
Prior sales experience is an added benefit.

Some of the qualities that the company seeks are:

• Self-motivation
• A master communicator
• A go-getter
• A graduate

As an employee, a candidate can apply for jobs at ICICI Prudential Life Insurance
through their e-recruitment section. The site provides a resume builder, also options of
various functions in which a candidate would like to work in.

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PERFORMANCE MANAGEMENT

At ICICI Prudential, career development is emphasized upon from the very day the
advisor joins the system. Though individual meetings with his or her manager, the
advisor can discuss various issues related to business development and career
enhancement. Expectations from the organization in terms of chalking a career in the
insurance industry are also discussed.

Tiger Team:

ICICI Prudential offers the “Tiger Team” programme for identified high potential
advisors. Hand picked by the management, these advisors are placed on a fast-track
career path and recognized as ‘Tiger trainers’. The advisors can participate in this
programme, subject to certain criteria being fulfilled.

Pinnacle Program:

Absorption into the management is another career enhancement option provided at

ICICI Prudential through the Pinnacle Program. This program helps advisors build a full
time career as a unit manager in the organization, offering great potential for managing
a team of advisors and personal development. ‘Fast track Pinnacle’ programme is also
available to advisors who are able to meet the performance criteria within the stipulated
time.

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COMPENSATION AND REWARD

ICICI Prudential advisors are constantly recognized and rewarded for their performance.
Numerous contests all year round promote healthy competition amongst advisors and
recognition for their efforts. Depending on the level of business the advisor achieves in a
year, he or she can become a member of various clubs such as the President’s club,
ICICI Pru Star International and the ICICI Pru Star India club. Each of these clubs
have specific performance criteria for qualification and members of these clubs are
entitled to attend seminars held at the exotic international and domestic locations each
year. Advisors can also qualify for the renowned MDRT (Million Dollar Round Table),
an exclusive international insurance advisors club.

INNOVATION IN HR PRACTICES

In an effort to improve employee morale the company has adopted IT for its HR
processes. The entire history of employees and their payment schedules have been
made available online and a reimbursement model has also been incorporated into the
system. Claim redemption and leave sanctioning, which was earlier a long drawn
process has now been reduced to a minimum through automation of the process.
Previously, tracking of vouchers used to pose a problem. But with Lotus Notes being
used as a messaging platform, vouchers are sent straight to the person in charge and
on approval the voucher is transferred to the financial department and money is
transferred to the bank.

TRAINING AND DEVELOPMENT

Advisors go through both generic and specific, professional programs that help them
remain well-informed and knowledgeable about the company’s products in the market.
There is a further focus on soft skills such as communication, managing long-term

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relationships and selling skills, which are very relevant in a service-driven industry like
life insurance.

The company also offers state of the art infrastructure training facilities coupled with an
excellent faculty, leading to an exceptional working environment. For advisors who
might be occupied with their daily business/professional routines, ICICI Prudential also
offers convenient training options such as online and self-learning are also provided by
the organization.

A 17-day training schedule covers the mandatory IRDA training requirements and ICICI
Prudential product-training module. Revision session ensure that the candidates
thoroughly understand the course contents and are well prepared for the licensing
examination. Theoretical training is interspersed with practical appointment settings with
potential customers, giving advisors a feel of how their business will work from the very
first day. All through, the Unit Manager and the management provide continuous
support to the advisors in achieving independence towards garnering business. ICICI
Prudential conducts an extensive Training to make a person a Professional Advisor.
Some of its training programs are listed as under:

 State-of-the-art training on:

 Selling skills
 Product knowledge
 Relationship skills

 Training delivery through several convenient options:

 Face to Face
 Online
 Self learning

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INSURANCE REGULATORY & DEVELOPMENT AUTHORITY
(IRDA)

Insurance Regulatory and Development Authority (IRDA) is constituted by the

Government of India, which governs all the companies that are operating in the
insurance sector in India. As per the section 4 of IRDA Act' 1999, Insurance Regulatory
and Development Authority (IRDA, which was constituted by an act of parliament)
specify the composition of Authority.

The Authority is a ten member team consisting of

(a) a Chairman;
(b) five whole-time members;
(c) four part-time members,
(all appointed by the Government of India.)

MISSION OF IRDA

To protect the interests of the policyholders, to regulate, promote and ensure orderly
growth of the insurance industry and for matters connected therewith or incidental
thereto.

Duties, Powers and Functions of IRDA

Section 14 of IRDA Act, 2000 lays down the duties, powers and functions of IRDA. The
Authority shall have the duty to regulate, promote and ensure orderly growth of the
insurance business and re-insurance business.

The powers and functions of the Authority shall include:

(a) Issue to the applicant a certificate of registration, renew, modify, withdraw,

suspend or cancel such registration;

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(b) Protection of the interests of the policy holders in matters concerning assigning
of policy, nomination by policy holders, insurable interest, settlement of
insurance claim, surrender value of policy and other terms and conditions of
contracts of insurance;
(c) Specifying requisite qualifications, code of conduct and practical training for
intermediary or insurance intermediaries and agents;
(d) Specifying the code of conduct for surveyors and loss assessors;
(e) Promoting efficiency in the conduct of insurance business;
(f) Promoting and regulating professional organizations connected with the
insurance and re-insurance business;
(g) Levying fees and other charges for carrying out the purposes of this Act;
(h) Calling for information from, undertaking inspection of, conducting enquiries
and investigations including audit of the insurers, intermediaries, insurance
intermediaries and other organizations connected with the insurance business;
control and regulation of the rates, advantages, terms and conditions that may
be offered by insurers in respect of general insurance business not so
controlled and regulated by the Tariff Advisory Committee under section 64U of
the Insurance Act, 1938 (4 of 1938);
(i) Specifying the form and manner in which books of account shall be maintained
and statement of accounts shall be rendered by insurers and other insurance
intermediaries;
(j) Regulating investment of funds by insurance companies;
(k) Regulating maintenance of margin of solvency.

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Name of Private Companies Register for Life Insurance Business

Yr: 2000-2004 : ( From 2nd April '2000 to 31st May'2004)

In the period of 2nd April 2000 to 31st May 2004, in life insurance business had 13 new
entrance, namely

Sr. Reg. Date of Reg. Name of the Company

No. No.
1 101 23.10.2000 HDFC Standard Life Insu. Co.
LTD.
2 104 15.11.2000 Max New Your Life Insu.Co. Ltd.
3 105 24.11.2000 ICICI Prudential Life Insu. Co.
Ltd.
4 107 10.01.2001 OM Kotakmahindra Life Insu.Co.
Ltd.
5 109 31.01.2001 Birla Sun Life Insurance Co. Ltd.
6 110 12.02.2001 TATA AIG Life Insurance Co.
Ltd.
7 111 30.03.2001 SBI Life Insurance Co. Ltd.
8 114 02.08.2001 ING Vysya Life Insu. Co. Pvt.
Ltd.
9 116 03.08.2001 Allianz bajaj Life Insu. Co. Ltd.
10 117 06.08.2001 Metlife India Insu. Co. Pvt. Ltd.
11 121 03.01.2002 AMP Sanmar Assurance Co. Ltd.
12 122 14.05.2002 Aviva life Insu. Co. India Pvt. Ltd.
13 127 06.02.2004 Sahara India Insu. Co. Pvt. Ltd.

Legislation (as on 1.4.2000)

Insurance is a federal subject in India. The primary legislation that deals with insurance
business in India is:

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Insurance Act, 1938, and Insurance Regulatory & Development Authority Act,
1999.

New products, innovative distribution, and better use of technology are helping the
new breed of private life insurers to take market shares away from the monopolist of
yesterday. Time was, if you wanted to buy a life insurance policy, you called a LIC
advisor referred to you by a friend or a relative. These days, you don’t have to go in
search of an advisor. He comes after you. There has been a sea change in the life
insurance industry. Now private life insurance companies are the market leaders. They
use all sort of marketing tricks such as DIRECT MARKETING, ALLIANCE
MARKETING and a new BANCASSURANCE. ICICI PRUDENTIAL LIFE INSURANCE
CO. LTD. is the new dominant player in the life insurance industry. Aggressive selling
strategies are the order of the day.

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 Chapter 3
Research Methodology

RESEARCH METHODOLOGY

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In this section of my project, the requirement is to describe the sources of collecting
primary and secondary data. For collecting primary data, method adopted was focus
group method.

TITLE OF THE STUDY

“Consumer Satisfaction ICICI prudential Life Insurance Company Limited”

DURATION OF THE PROJECT

15 Days

OBJECTIVES OF THE STUDY

 To analysis the product details of ICICI Prudential life Insurance Company limited.

 To find ‘Points of Parity’ and ‘Points of Difference’ of ICICI Prudential Life Insurance
Company Limited.

 To find out factors that influence customers to purchase insurance policies and give
suggestions for further improvement.

TYPES OF RESEARCH

I have used Descriptive research design.

SAMPLING & SAMPLE SIZE

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Sampling refers to the method of selecting a sample from a given universe with a view to draw
conclusions about that universe. A sample is a representative of the universe selected for study.

SCOPE OF THE STUDY

It is a general belief that life insurance is meant only for those with families. It is true that
Life Insurance Policies like whole-life insurance, joint-life-insurance, pension-life-
insurance etc are essential for family's financial security, but they are equally important
for individuals. Term Insurance policies protect your financial resources against the
uncertainties of life so you can protect your family's future.

LIMITATIONS

 As the movement throughout the city is not possible due to certain constraints
so the movement was quite restricted.
 People are not ready to go for training. As the training period is of 17 days
and it involves full day, so it becomes difficult for them to leave their offices or
shops for such a long time.
 The compulsion of selling 12 policies in a year also restricts them from
becoming advisors. If they do not fulfill this target, then their license is
cancelled after a year.
 Lack of trust on any company of Private Sector.
 Lack of knowledge about the products of ICICI Prudential and their total and
blind faith on LIC..
 Some people ask about comparative analysis with LIC.
 Some people consider IRDA fees of Rs. 1000 as a constraint.
 Non-availability of part-time training.

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 All small towns are not open for doing this business.
 One person cannot take Life Insurance Agency of two different Companies.
 Time constraint is the biggest constraint in taking up the study.

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 Chapter

RECOMMENDATIONS

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RECOMMENDATIONS

 Expand Distribution Network In Semi Rural Areas

- Start business in all small towns.

 Target Semi Rural Market

- Offer agencies to localite people.

- Open operation offices with highly educated team.

OTHER RECOMMENDATIONS

1. Provide lower premium policies so that we could target middle class people and
generate good cash flow for further growth.

As per BCG matrix to ensure long-term value creation, a company should have a
portfolio of products that contains both high-growth products in need of cash inputs
and low-growth products that generate a lot of cash. ICICI Prudential has high-
growth product in urban market but company should follow the low growth product
strategy also in urban market.

2. Start advertisement campaign again on television, radio and Internet also. Do

intensive marketing for business opportunity and products both.
3. Keep more seminar and target LI/GI agents, CAS, Tax consultant financial investor
etc.
4. Provide best motivation to Agency holders.
5. Build trust upon customers through services and transparency in investment and
other policy.

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6. Provide all branches in local language.
7. Provide part time training.
8. Focus on any mass marketing activity for generating awareness of company
among people and offering them business opportunity too.
9. Hold stall activity in different places.
10. Do some social activities through which company could get benefit of marketing
indirectly.
11. Try to collect data of Life/General insurance agents across India and invite them to
associating with ICICI Prudential.

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Chapter
BibliographyS
REFERENCES

Web sites
 www.iciciprulife.com
 www.ipruuniverse.com
 www.icici.com
 www.irdaindia.org
 www.indiacore.com
 www.maxnewyorklife.com

Magazines

Insurance Plus
Business India
 Economic Times
 Material provided by the company
 Survey

Search Engines

 www.google.com
 www.yagoohoogle.com

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 www.altavista.com

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