A REPORT ON INSURANCE SECTOR

Contents:

1. INSURANCE HISTORY WORLD WIDE

2. INSURANCE HISTORY INDIA
3. INSURANCE ACT &IRDA ACT
4. MALAHOTRA COMMITTEE
5. ICICI PRUDENTIAL LIFE INSURANCE
INSURANCE:

Insurance or assurance, device for indemnifying or guaranteeing an individual against

loss. Reimbursement is made from a fund to which many individuals exposed to the same
risk have contributed certain specified amounts, called premiums. Payment for an
individual loss, divided among many, does not fall heavily upon the actual loser. The
essence of the contract of insurance, called a policy, is mutuality. The major operations of
an insurance company are underwriting, the determination of which risks the insurer can
take on; and rate making, the decisions regarding necessary prices for such risks. The
underwriter is responsible for guarding against adverse selection, wherein there is
excessive coverage of high risk candidates in proportion to the coverage of low risk
candidates. In preventing adverse selection, the underwriter must consider physical,
psychological, and moral hazards in relation to applicants. Physical hazards include those
dangers which surround the individual or property, jeopardizing the well-being of the
insured. The amount of the premium is determined by the operation of the law of
averages as calculated by actuaries. By investing premium payments in a wide range of
revenue-producing projects, insurance companies have become major suppliers of capital,
and they rank among the nation's largest institutional investors.

The History of Insurance in the world:

The roots of insurance might be traced to Babylonia, where traders were encouraged to
assume the risks of the caravan trade through loans that were repaid (with interest) only
after the goods had arrived safely a practice resembling bottomry and given legal force in
the Code of Hammurabi (c.2100 B.C.). The Phoenicians and the Greeks applied a similar
system to their seaborne commerce. The Romans used burial clubs as a form of life
insurance, providing funeral expenses for members and later payments to the survivors.

With the growth of towns and trade in Europe, the medieval guilds undertook to protect
their members from loss by fire and shipwreck, to ransom them from captivity by pirates,
and to provide decent burial and support in sickness and poverty. By the middle of the
14th cent., as evidenced by the earliest known insurance contract (Genoa, 1347), marine
insurance was practically universal among the maritime nations of Europe. In London,
Lloyd's Coffee House (1688) was a place where merchants, ship-owners, and
underwriters met to transact business. By the end of the 18th cent. Lloyd's had progressed
into one of the first modern insurance companies. In 1693 the astronomer Edmond Halley
constructed the first mortality table, based on the statistical laws of mortality and
compound interest. The table, corrected (1756) by Joseph Dodson, made it possible to
scale the premium rate to age; previously the rate had been the same for all ages.
Insurance developed rapidly with the growth of British commerce in the 17th and 18th
cent. Prior to the formation of corporations devoted solely to the business of writing
insurance, policies were signed by a number of individuals, each of whom wrote his name
and the amount of risk he was assuming underneath the insurance proposal, hence the
term underwriter. The first stock companies to engage in insurance were chartered in
England in 1720, and in 1735, the first insurance company in the American colonies was
founded at Charleston, S.C. Fire insurance corporations were formed in New York City
(1787) and in Philadelphia (1794). The Presbyterian Synod of Philadelphia sponsored
(1759) the first life insurance corporation in America, for the benefit of Presbyterian
ministers and their dependents. After 1840, with the decline of religious prejudice against
the practice, life insurance entered a boom period. In the 1830s the practice of classifying
risks was begun.

The New York fire of 1835 called attention to the need for adequate reserves to meet
unexpectedly large losses; Massachusetts was the first state to require companies by law
(1837) to maintain such reserves. The great Chicago fire (1871) emphasized the costly
nature of fires in structurally dense modern cities. Reinsurance, whereby losses are
distributed among many companies, was devised to meet such situations and is now
common in other lines of insurance. The Workmen's Compensation Act of 1897 in
Britain required employers to insure their employees against industrial accidents. Public
liability insurance, fostered by legislation, made its appearance in the 1880s; it attained
major importance with the advent of the automobile.

In the 19th cent. many friendly or benefit societies were founded to insure the life and
health of their members, and many fraternal orders were created to provide low-cost,
members-only insurance. Fraternal orders continue to provide insurance coverage, as do
most labor organizations. Many employers sponsor group insurance policies for their
employees; such policies generally include not only life insurance, but sickness and
accident benefits and old-age pensions, and the employees usually contribute a certain
percentage of the premium.

Since the late 19th cent. there has been a growing tendency for the state to enter the field
of insurance, especially with respect to safeguarding workers against sickness and
disability, either temporary or permanent, destitute old age, and unemployment (see
social security). The U.S. government has also experimented with various types of crop
insurance, a landmark in this field being the Federal Crop Insurance Act of 1938. In
World War II the government provided life insurance for members of the armed forces;
since then it has provided other forms of insurance such as pensions for veterans and for
government employees.

After 1944 the supervision and regulation of insurance companies, previously an

exclusive responsibility of the states, became subject to regulation by Congress under the
interstate commerce clause of the U.S. Constitution. Until the 1950s, most insurance
companies in the United States were restricted to providing only one type of insurance,
but then legislation was passed to permit fire and casualty companies to underwrite
several classes of insurance. Many firms have since expanded, many mergers have
occurred, and multiple-line companies now dominate the field. In 1999, Congress
repealed banking laws that had prohibited commercial banks from being in the insurance
business; this measure was expected to result in expansion by major banks into the
insurance arena.

In recent years insurance premiums (particularly for liability policies) have increased
rapidly, leaving unprecedented numbers of Americans uninsured. Many blame the
insurance conglomerates, contending that U.S. citizens are paying for bad risks made by
the companies. Insurance companies place the burden of guilt on law firms and their
clients, who they say have brought unreasonably large civil suits to court, a trend that has
become so common in the United States that legislation has been proposed to limit
lawsuit awards. Catastrophic earthquakes, hurricanes, and wildfires in late 1980s and the
90s have also strained many insurance company's reserves.

HISTORY OF INSURANCE SECTOR 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 190 years.

The business of life insurance in India in its existing form started in India in the year
1818 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 consolidated and amended to by the Insurance Act with the
objective of protecting the interests of the insuring public.

1956 - 245 Indian and foreign insurers and provident societies taken over by the central
government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956,
with a capital contribution of Rs. 5 crore 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.

1972 - The General Insurance Business (Nationalization) Act, 1972 nationalized the
general insurance business in India with effect from 1st January 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.

• LIC Housing Finance.

• Cholamandalam General Insurance
• Glaxosmithkline Consumers
• American Express

Indian Insurance Market-History

Insurance has a long history in India. Life Insurance in its current form was introduced in
1818 when Oriental Life Insurance Company began its operations in India. General
Insurance was however a comparatively late entrant in 1850 when Triton Insurance
company set up its base in Kolkata. History of Insurance in India can be broadly
bifurcated into three eras: a) Pre Nationalisation b) Nationalisation and c) Post
Nationalsiation.

Life Insurance was the first to be nationalized in 1956. Life Insurance Corporation of
India was formed by consolidating the operations of various insurance companies.
General Insurance followed suit and was nationalized in 1973. General Insurance
Corporation of India was set up as the controlling body with New India, United India,
National and Oriental as its subsidiaries. The process of opening up the insurance sector
was initiated against the background of Economic Reform process which commenced
from 1991. For this purpose Malhotra Committee was formed during this year who
submitted their report in 1994 and Insurance Regulatory Development Act (IRDA) was
passed in 1999. Resultantly Indian Insurance was opened for private companies and
Private Insurance Company effectively started operations from 2001.

Insurance Market Present

The insurance sector was opened up for private participation four years ago. For years
now, the private players are active in the liberalized environment. The insurance market
have witnessed dynamic changes which includes presence of a fairly large number of
insurers both life and non-life segment. Most of the private insurance companies have
formed joint venture partnering well recognized foreign players across the globe.

Capital requirement and foreign participation.

Minimum capital requirement for direct life and Non-life Insurance company is INR1000
million and that for reinsurance company is INR2000 million. A maximum 26% foreign
equity stake is allowed in direct insurance and reinsurance companies. In the 2004-05
budget, the Government proposed for increasing the foreign equity stake to 49%, this is
yet to be effected. There are currently fourteen non-life insurance companies, out of
which two are specialized Insurance companies viz. Agricultural Insurance Co, who
handles Crop Insurance business and Export Credit Guarantee Corporation which only
transacts export Credit Insurance. There are a total of 13 life insurance companies
operating in India, of which one is a Public Sector Undertaking and the balance 12 are
Private Sector Enterprises.

Fifth 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 while health
insurance and non-life insurance continues 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.
Insurance is a federal subject in India. There are two legislations that govern the sector-
The Insurance Act- 1938 and the IRDA Act- 1999. The insurance sector in India has
come a full circle from being an open competitive market to nationalisation and back to a
liberalised market again. Tracing the developments in the Indian insurance sector reveals
the 360 degree turn witnessed over a period of almost two centuries.

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 recognising 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:

i)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.

ii)Competition Private Companies with a minimum paid up capital of Rs.1bn should be

allowed to enter the sector. No Company should deal in both Life and General Insurance
through a 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.
iii)Regulatory Body The Insurance Act should be changed. An Insurance Regulatory
body should be set up. Controller of Insurance- a part of the Finance Ministry- should be
made independent

iv)Investments Mandatory Investments of LIC Life Fund in government securities to be

reduced from 75% to 50%. GIC and its subsidiaries are not to hold more than 5% in any
company (there current holdings to be brought down to this level over a period of time)

v)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.
Computerisation of operations and updating of technology to be carried out in the
insurance industry.

The committee emphasised that in order to improve the customer services and increase
the coverage of insurance policies, 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. Since being set up as an independent statutory
body the IRDA has put in a framework of globally compatible regulations. The other
decision taken simultaneously to provide the supporting systems to the insurance sector
and in particular the life insurance companies was 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.

RESENT SCENARIO:

The Government of India liberalised 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.
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. In the private sector 12 life insurance and 8 general insurance companies have
been registered. A host of private Insurance companies operating in both life and non-life
segments have started selling their insurance policies since 2001.

Non-Life Insurance Market

In December 2000, the GIC subsidiaries were restructured as independent insurance
companies. At the same time, GIC was converted into a national re-insurer. In July 2002,
Parliamant passed a bill, delinking the four subsidiaries from GIC.
Presently there are 12 general insurance companies with 4 public sector companies and 8
private insurers. Although the public sector companies still dominate the general
insurance business, the private players are slowly gaining a foothold. According to
estimates, private insurance companies have a 10 percent share of the market, up from 4
percent in 2001. In the first half of 2002, the private companies booked premiums worth
Rs 6.34 billion. Most of the new entrants reported losses in the first year of their
operation in 2001.
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 implementaion, 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 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 costs constitute roughly around 1.2- 2 percent of the total project costs. Under
the existing norms, insurance premium payments are treated as part of the fixed costs.
Consequently they are treated as pass-through costs for tariff calculations.
Premium rates of most general insurance policies come under the purview of the
government appointed Tariff Advisory Commitee. For Projects costing up to Rs 1 Billion,
the Tariff Advisory Committee sets the premium rates, for Projects between Rs 1 billion
and Rs 15 billion, the rates are set in keeping with the committee's guidelines; and
projects above Rs 15 billion are subjected to re-insurance pricing. It is the last segment
that has a number of additional products and competitive pricing.
Insurance, like project finance, is extended by a consortium. Normally one insurer takes
the lead, shouldering about 40-50 per cent of the risk and receiving a proportionate
percentage of the premium. The other companies share the remaining risk and premium.
The policies are renewed usually on an annual basis through the invitation of bids.
Of late, with IPP projects fizzling out, the insurance companies are turning once again to
old hands such as NTPC, NHPC and BSES for business.

Re-insurance business:
Insurance companies retain only a part of the risk (less than 10 per cent) assumed by
them, which can be safely borne from their own funds. The balance risk is re-insured with
other insurers. In effect, therefore, re-insurance is insurer's insurance. It forms the
backbone of the insurance business. It helps to provide a better spread of risk in the
international market, allows primary insurers to accept risks beyond their capacity, settle
accumulated losses arising from catastrophic events and still maintain their financial
stability.
While GIC's subsidiaries look after general insurance, GIC itself has been the major
reinsurer. Currently, all insurance companies have to give 20 per cent of their reinsurance
business to GIC. The aim is to ensure that GIC's role as the national reinsurer remains
unhindered. However, GIC reinsures the amount further with international companies
such as Swissre (Switzerland), Munichre (Germany), and Royale (UK). Reinsurance
premiums have seen an exorbitant increase in recent years, following the rise in threat
perceptions globally.

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 has tripled to Rs 1000 crore 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 privatisation was around Rs 50,000. That has risen to about Rs 80,000. But the
private insurers are ahead in this game and the average size of their policies is around Rs
1.1 lakh to Rs 1.2 lakh- way bigger than the industry average.

Buoyed by their quicker than expected success, nearly all private insurers are fast-
forwarding the second phase of their expansion plans. No doubt the aggressive stance of
private insurers is already paying rich dividends. But a rejuvenated LIC is also trying to
fight back to woo new customers.

MALHOTRA COMMITTEE :

In 1993, the first step towards insurance sector reforms was initiated with the formation
of Malhotra Committee, headed by former Finance Secretary and RBI Governor R.N.
Malhotra. The committee was formed to evaluate the Indian insurance industry and
recommend its future direction with the objective of complementing the reforms initiated
in the financial sector.

Key Recommendations of Malhotra Committee

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.1billion should be
allowed to enter the industry.
• No Company should deal in both Life and General Insurance through a 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 should be made independent.

Investments

• Mandatory Investments of LIC Life Fund in government securities to be reduced

from 75% to 50%.
• GIC and its subsidiaries are not to hold more than 5% in any company.

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.
• Computerisation of operations and updating of technology to be carried out in the
insurance industry.

Malhotra Committee also proposed setting up an independent regulatory body - The

Insurance Regulatory and Development Authority (IRDA) to provide greater autonomy to
insurance companies in order to improve their performance and enable them to act as
independent companies with economic motives.

The Insurance Act, 1938

The Insurance Act, 1938 was the first legislation governing all forms of insurance
to provide strict state control over insurance business. You can download the act by
clicking here
Life Insurance Corporation Act, 1956

Even though the first legislation was enacted in 1938, it was only in 19 January
1956, that life insurance in India was completely nationalized, through a Government
ordinance; the Life Insurance Corporation Act, 1956 effective from 1.9.1956 was enacted
in the same year to, inter-alias, form LIFE INSURANCE CORPORATION after
nationalization of the 245 companies into one entity. There were 245 insurance
companies of both Indian and foreign origin in 1956. Nationalization was accomplished
by the govt. acquisition of the management of the companies. The Life Insurance
Corporation of India was created on 1st September, 1956, as a result and has grown to be
the largest insurance company in India as of 2006.

General Insurance Business (Nationalization) Act, 1972:

The General Insurance Business (Nationalization) Act, 1972 was enacted to

nationalize the 100 odd general insurance companies and subsequently merging them into
four companies. All the companies were amalgamated into National Insurance, New
India Assurance, Oriental Insurance, United India Insurance which were headquartered in
each of the four metropolitan cities.

Insurance Regulatory and Development Authority (IRDA) Act, 1999

Till 1999, there were not any private insurance companies in Indian insurance
sector. The Govt. of India then introduced the Insurance Regulatory and Development
Authority Act in 1999, thereby de-regulating the insurance sector and allowing private
companies into the insurance. Further, foreign investment was also allowed and capped at
26% holding in the Indian insurance companies. In recent years many private players
entered in the Insurance sector of India. Companies with equal strength competing in the
Indian insurance market. Currently, in India only 2 million people (0.2 % of total
population of 1 billion), are covered under Mediclaim, whereas in developed nations like
USA about 75 % of the total population are covered under some insurance scheme. With
more and more private players in the sector this scenario may change at a rapid pace.

About the company:

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank- one of
India’s financial services companies – and Prudential plc- a leading international
financial services group headquartered in the United Kingdom. ICICI Bank holds a stake
of 74% and Prudential plc holding 26%.
The company began the operations in December 2000 after receiving approval from
IRDA. ICICI Prudential is the first life insurer in India to receive a National Insurer
Financial Strength rating of AAA from Fitch ratings.

Vision and Values:

Our Vision :

To be the dominant Life, Health and Pensions player built on trust by world-class people
and service.

Our Values:

Every member of the ICICI Prudential team is committed to 5 core values : Integrity ,
Customer first, Boundary less, Ownership, and Passion.

Board of Directors :

 Mr. K.V. Kamath, Chairman.

 Ms. Chanda Kochhar, Director.
 Mr. Barry Stowe, Director.
 Mr. Adrian O’Connor, Director.
 Prof. Marti G. Subrahmanyam, Director.
 Mr. Mahesh Prasad Modi, Director.
 Ms. Rama Bijapurkar, Director.
 Mr. Keki Dadiseth, Director.
 Ms. Shikha Sharma, Managing Director.
 Mr. N.S. Kannan, Executive Director.
 Mr. Bhargav Dasgupta, Executive Director.
Distribution :

ICICI Prudential life has one of the largest distribution networks amongst private life
insurers in India. It has a strong presence across India with over 2000 branches and an
advisor base of over 261000. (as on Aug. 31, 2008.). The compant has 24 bancassurance
partners.

Products:

 Save n Protect.
 Cash Bak
 Life Time Gold
 Life Stage RP
 Life Link Super
 Premier Life Gold.
 Investsheild Cash Bak
 Life Stage Assure.

Channels:

 Unit Manager.
 Sales Manager.
 Branch Manager.
 Proprietary Force (FSC).
 Direct Marketing.

BUSINESS PERFORMANCE
 Organizations need to establish both financial and non-financial targets in order to
evaluate and improve their business performance. Targets may have different
connotations like quality standards, service levels, benchmarks, service guarantees,
numerical goals, budgets, and quotas. Targets may be applied at different levels of the
organization. They can be applied to the organization as a whole, or at different levels
like the business unit level, the branch level, the project level, the team level, or even
the individual level.
. For example. A financial service consultant working in ICICI prudential life
insurance would have an individual sales target. Since financial service consultants
report to a financial service manager, these financial service mangers will report to
the branch sales manager of a particular branch. The target of the manager is the
branch target. Similarly, there will be an area wise target, zone wise target, state wise
target and so on.

Performance can be tracked and reported in two ways: year-to-date or period-to-period.

In year-to-date reporting, performance is tracked for the period from the beginning of the
financial year to the present date under review. In period-to-period reporting,
performance is tracked on monthly or weekly or seasonal basis.

FACTORS AFFECTING BUSINESS PERFORMANCE

The success or failure of a business organization depends on a number of factors. These

factors can be classified into external factors and internal factors. External factors are
those that are not under the organization’s direct control, such as government rules and
regulations, and natural calamities. However there are certain factors which can be
controlled by the organization. Some of these are service orientation, product quality,
purchasing, partnership, administration, employees, leadership, and strategy.

.
SUMMARY
ICICI Prudential Life Insurance has one of the target distribution networks amongst
private life insurers in INDIA .It has a strong presence across India with over 2000
branches and advisor base of over 261000.The company has 24
Over all on premium in 2007-2008 we can say that individual single premium in 07 is
more compare to 08 overall on individual single premium is slightly decreasing.
So company has to take proper step to control it.
Individual non single premium has increased compare to 2007
Group single premium has decreased compare 2007
Group non single premium has increased compare to 2007
So overall about different types of premium we can say that indivual and group single
premium has decreased and indivual and group non single premium is increasing.
But compare to other companies such has HDECSTANDARD TATAAIG
BIRLASUNLIFE AVIVA INGVYSYA ICICI premium are more.
 consumer behavior & customer
satisfaction towards ICICI Prudential
Life Insurance Products

STATEMENT OF THE PROBLEM

“Study of consumer behavior & customer satisfaction towards ICICI Prudential Life
Insurance Products”.
OBJECTIVE OF THE STUDY

For every problem there is a research. As all the researches are based on some
and my study is also based upon some objective and these are as follows.

1. To understand the insurance business and products of ICICI Prudential life

insurance co ltd.

2. To find out the people’s perception about life insurance.

3. To find out whether people were really aware of life insurance.

4. To find out how people think about private life insurance.

5. To find out what respondents expect from life insurance.

6. To understand Consumer buying behavior

7. To come out with conclusion and suggestions based on the analysis and the
Interpretation of data.

SIGNIFICANCE OF THE STUDY

The project is concerned with the “STUDY ON CONSUMER BEHAVIOR
AND CUSTOMER SATISFACTION AT ICICI PRUDENTIAL LIFE
INSURANCE. This study is very useful as the financial market become more
sophisticated and complex, investor needs a financial intermediary who provides
the required knowledge and professional expertise on successful investing and
Life insurance is a form of insurance that pays monetary proceeds upon the
death of the insured covered in the policy. Essentially, a life insurance policy is
a contract between the named insured and the insurance company wherein the
insurance company agrees to pay an agreed upon sum of money to the insured's
named beneficiary so long as the insured's premiums are current