harsheet kaur

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Life insurance get the life secure

A training report submitted in partial fulfilment of the requirement for the degree

Of

BACHOLER OF BUSINESS ADMINISTRATION

(2009-2012)

SUBMITTED BY:-

HARSHEET KAUR

ACKNOWLEDGEMENT



I feel immense pleasure to give the credit of my project work notonly to one individual as this work is integrated effort of all those who concerned

with it. I want to owe my thanks to all those individuals who guided me to moveon the track.

This report entitled ´ICICI LIFE INSURANCEµ is the

outcome of my summer training at DYNAMIC INVESTMENT SERVICES,

SURYA COMPLEX, LEELA BHAVAN (PATIALA)

I would like to appreciate the pain staking effort of Mr.

MANIDER SINGH (Managing director) and & Mrs. HARDEEP KAUR (HOM) for

educating and guiding me at each and every stage and providing me the

information related to my chosen topic. I am equally thankful to the whole

team of DYNAMIC INVESTMENT SERVICSE COMPNY , who extended their full

co-operation and assistance. Words are not sufficient to express the greatness

for the help, guidance and knowledge dispensed to me by Respected Mr.

NARESH KUMAR (HEAD OF MARKETING & SALE), who not only lent her

considerable time and energy to the understanding, but also helped me a great

deal in making this report see the light of the day.

Last but not least, I owe my special regards to my parents and my

elders for their blessings and good wish



CONTENTS

Acknowledgement

C hapter - 1 INTRODU C TION C hapter - 2 C OMPANY PROFILE

C hapter - 3 OBJE C TIVES AND SC OPE

C hapter - 4 RESEARCH MET H ODOLOGY

C hapter - 5 DATA ANALYSIS AND INTERPRETATION

C hapter - 6 FINDINGS AND C ON C LUSIONS

C hapter - 7 SUGGESTIONS & RE C OMMENDATIONS

BIBLIOGRAP H Y



CH APTER 1

INTRODU C TION

What is insurance?



Life Insurance is the key to good f inancial planning. On one hand, it safeguards your moneyand on the other, ensures its growth, thus providing you with complete f inancial well being.

Life Insurance can be termed as an agreement between the policy owner and the insurer,where the insurer for a consideration agrees to pay a sum of money upon the occurrence of

the insured individual's or individuals' death or other event, such as terminal illness, cr itical

illness or matur ity of the policy.

Life insurance plans, unlike mutual funds, are benef icial when you look at them as a long

term avenue of investment which also offers protection through life cover. Life insurance

policies are broadly categor ized into 2 types; Traditional Plans and Unit Linked Insurance

Plans (ULIPs).

Traditional policies offer in-built guarantees and def ine matur ity benef its through var iety of

products such as guaranteed matur ity value. The investment r isk in traditional life insurance

policies is borne by life insurance companies. Additionally, the investment decisions are

regulated to a large extent by IRDA rules and regulations, ensur ing stable returns withminimal r isk. Investment income is distr i buted amongst the policy holders through annual

bonus. These policies are ideal for policy holders who are not market savvy and do not wish

to take investment r isks.

ULIPs, on the other hand provide a combination of r isk cover and investment. Moreimportantly they offer a flexi bility to decide your r isk tak ing prof ile.



What is a life insurance policy?

A life insurance policy provides financial protection to your family in the unfortunate event of your

death. At a basic level, it involves paying small sums each month (called premiums) to cover the risk

of your untimely demise during the tenure of the policy. In such an event, your family (or the

beneficiaries you have named in the policy) will receive a lumpsum amount. In case you live till the

maturity of the policy, depending on the type of life insurance policy you have opted for, you will

receive returns the policy may have earned over the years. Today, there are many variations to this

basic theme, and insurance policies cater to a wide variety of needs.

TYPES:-

Term Insurance Policy

y A term insurance policy is a pure risk cover policy that protects the person insured

for a specific period of time. In such type of a life insurance policy, a fixed sum of

money called the Sum Assured is paid to the beneficiaries (family) if the policyholder

expires within the policy term. For instance, if a person buys a Rs 2 lakh policy for 15

years, his family is entitled to the sum of Rs 2 Lakh if he dies within that 15-year

period.

y If the policy holder survives the 15-year period, the premiums paid are not returned

back. The advantage, apart from the financial security for an individuals family is

that the premiums paid are exempt from tax.

y These insurance policies are designed to provide 100 per cent risk cover and hence

they do not have any additional charges other than the basic ones. This makes

premiums paid under such life insurance policies the lowest in the life insurance

category.

Whole Life Policy y A whole life policy covers a policyholder against death, throughout his life term. The

advantage that an individual gets when he / she opts for a whole life policy is that

the validity of this life insurance policy is not defined and hence the individual enjoys

the life cover throughout his or her life.

y Under this life insurance policy, the policyholder pays regular premiums until his

death, upon which the corpus is paid to the family. The policy does not expire till the

time any unfortunate event occurs with the individual.



y Increasingly, whole life policies are being combined with other insurance products to

address a variety of needs such as retirement planning, etc.

y Premiums paid under the whole life policies are tax exempt.

Endowment Policy

y Combining risk cover with financial savings, endowment policies are among the

popular life insurance policies.

y Policy holders benefit in two ways from a pure endowment insurance policy. In case

of death during the tenure, the beneficiary gets the sum assured. If the individual

survives the policy tenure, he gets back the premiums paid with other investment

returns and benefits like bonuses.

y In addition to the basic policy, insurers offer various benefits such as double

endowment and marriage/ education endowment plans.

y In recent times, the concept of providing the customers with better returns has been

gaining importance. Hence, insurance companies have been coming out with new

and better ULIP versions of endowment policies. Under such life insurance policies

the customers are also provided with an option of investing their premiums into the

markets, depending on their risk appetite, using various fund options provided by

the insurer, these life insurance policies help the customer profit from rising

markets.

y The premiums paid and the returns accumulated through pure endowment policies

and their ULIP variants are tax exempt.

Money Back Policy

y This life insurance policy is favored by many people because it gives periodic

payments during the term of policy. In other words, a portion of the sum assured is

paid out at regular intervals. If the policy holder survives the term, he gets the

balance sum assured.

y In case of death during the policy term, the beneficiary gets the full sum assured.

y NewULIP versions of money back policies are also being offered by various life

insurers.

y The premiums paid and the returns accumulated though a money back policy or its

ULIP variants are tax exempt.

ULIPS

y ULIPs are market-linked life insurance products that provide a combination of life

cover and wealth creation options.

y A part of the amount that people invest in a ULIP goes toward providing life cover,



while the rest is invested in the equity & debt instruments for maximizing returns.

y They provide the flexibility of choosing from a variety of fund options depending on

the customers risk appetite. One can opt from aggressive funds (invested largely in

the equity market with the objective of high capital appreciation) to conservative

funds (invested in debt markets, cash, bank deposits and other instruments, with the

aim of preserving capital while providing steady returns).y ULIPs can be usefull for achieving various long term financial goals such as planning

for retirement, childs education, marriage etc.

Annuities and Pension

y In these types of life insurance policies, the insurer agrees to pay the insured a

stipulated sum of money periodically. The purpose of an annuity is to protect against

financial risks as well as provide money in the form of pension at regular intervals



The History of Life Insurance

Risk protection has been a primary goal of humans and institutions throughout history.Protecting against risk is what insurance is all about.

Over 5000 years ago, in China, insurance was seen as a preventative measure againstpiracy on the sea. Piracy, in fact, was so prevalent, that as a way of spreading the risk, anumber of ships would carry a portion of another ship's cargo so that if one ship wascaptured, the entire shipment would not be lost.

In another part of the world, nearly 4,500 years ago, in the ancient land of Babylonia, tradersused to bear risk of the caravan trade by giving loans that had to be later repaid with interestwhen the goods arrived safely. In 2100 BC, the Code of Hammurabi granted legal status tothe practice. It formalized concepts of ³bottomry´ referring to vessel bottoms and³respondentia´ referring to cargo. These provided the underpinning for marine insurancecontracts. Such contracts contained three elements: a loan on the vessel, cargo, or freight;an interest rate; and a surcharge to cover the possibility of loss. In effect, ship owners were

the insured and lenders were the underwriters.

Life insurance came about a little later in ancient Rome, where burial clubs were formed tocover the funeral expenses of its members, as well as help survivors monetarily. WithRome's fall, around 450 A.D., most of the concepts of insurance were abandoned, butaspects of it did continue through the Middle Ages, particularly with merchant and artisanguilds. These provided forms of member insurance covering risks like fire, flood, theft,

disability, death, and even imprisonment.

During the feudal period, early forms of insurance ebbed with the decline of travel and long-distance trade. But during the 14th to 16th centuries, transportation, commerce, and

insurance would again reemerge.

Insurance in India can be traced back to the Vedas. For instance, yogakshema, the name of

Life Insurance Corporation of India's corporate headquarters, is derived from the Rig Veda.The term suggests that a form of "community insurance" was prevalent around 1000 BC and

practiced by the Aryans.

And similar to ancient Rome, burial societies were formed in the Buddhist period to help

families build houses, and to protect widows and children



What is a life insurance policy?

A life insurance policy provides financial protection to your family in the unfortunate event of your

death. At a basic level, it involves paying small sums each month (called premiums) to cover the risk

of your untimely demise during the tenure of the policy. In such an event, your family (or the

beneficiaries you have named in the policy) will receive a lumpsum amount. In case you live till the

maturity of the policy, depending on the type of life insurance policy you have opted for, you will

receive returns the policy may have earned over the years. Today, there are many variations to this

basic theme, and insurance policies cater to a wide variety of needs.



CHAPTER ± 2

COMPANY

PROFILE



Starting in 1957 With LIC India In 2007

16 new companiesThe Malhotra committee, appointed in 1993

1. HDFC Standard Life Insurance Company Ltd.

2. Max New York Life Insurance Co. Ltd.

3. ICICI Prudential Life Insurance Company Ltd .

4. Kotak Mahindra Old Mutual Life Insurance Limited.

5. Birla Sun Life Insurance Company Ltd. 6. Tata AIG Life Insurance Company Ltd.

7. SBI Life Insurance Company Limited.

8. ING Vysya Life Insurance Company Private Limited.

9. Met life India Insurance Company Ltd.

10. Royal Sundaram Life Insurance Company Limited.

11. Aviva Life Insurance Co. India Pvt. Ltd. 12. Sahara India Insurance Company Ltd.

13. Shriram Life Insurance Company

14. Life Insurance Corporation of India.

15.Reliance Life Insurance Company Limited

. 16. Bharti AXA Life Insurance Company Limited

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank, one of

the foremost f inancial services companies of India and Prudential plc, one of the leading

international f inancial services group headquartered in the United K ingdom. ICICI Prudentialwas amongst the f irst pr ivate sector life insurance companies to begin operations in

December 2000 after receiving approval from Insurance Regulatory Development Author ity(IRDA).



ICICI Prudential Life's capital stands at Rs. 4,780 crores (as of September 30, 2010) w ithICICI Bank and Prudential plc holding 74% and 26% stake respectively. For the per iod Apr il

1, 2010 to September 30, 2010, the company garnered Rs 7,267 crores of total premiums andhas underwr itten over 10 million policies since inception. The company has a network of

over 1,500 off ices and over 1,60,000 advisors, as on September 30, 2010. The company has

assets held over Rs. 65,000 crores as on September 30, 2010.

For the past nine years, ICICI Prudential Life has maintained a wide range of Life Insurance

products that meet the needs of the Indian customer at every step in life.

ICICI Prudential Life recently completed 10 years on the Indian Insurance scape on 12th

December 2010.

Type Private limited company Industry Insurance HeadquartersMumbai Key people Sandeep Bakshi,

Managing Director Products Individual and Group Insurance Plans Website Official Website



CH

AP

TER 3

SCOPE &

OBJECTIVE



Scope of the study This study can be conducted by compar ing the

performances & products of three pr ivate &

government insurance players in insurance

industry

The number of respondents to be surveyed can be

Improved.

The study can be conducted in Amr itsar city only.

This study can be conducted to analyze the market

stand of Reliance Life Insurance Company

Limited and Life Insurance Corporation of India

Insurance companies



OBJECTIVE

y To study the benefits of this product provided by

HDFC Standard Life Insurance company.y To know the consumer feedback.

y To know the marketing strategies adopted

to promote these products .

y To make the private players responsible to

the investors and not to the government .

y To increase the competition in this sector so that the common people has the

advantage of enjoying quality services at a

reasonable cost

y Insurance has a far -reaching effect in

synchronizing between the various service

sectors . So if this sector can grow, the prospects of the various other service sector

remains to be promising .



CHAPTER- 4 RESEARCH

METHODOLOGY



RESEARCH METHODOLOGY

Th is report is based on pr imary as well

secondary data, however pr imary datacollection was given more importance since it is

overhear ing factor in attitude studies. One of the mostimportant users of research methodology is that it helps

in identifying the problem, collecting, analyzing the

required information data and providing analternative solution to the problem .It also helps in

collecting the vital information that is required by the

top management to assist them for the better

decision mak ing both day to day decision and cr iticalones.

Data sources:

Research is totally based on pr imary data.

Secondary data can be used only for the

reference. Research has been done by pr imarydata collection, and pr imary data has been

collected by interact ing with var ious people. The secondary data has been

collected through var ious journals and websites.



Duration of Study:The study was carr ied out for a per iod of

two months, from 1June to 31 July

Sampling:

Sampling procedure:

The sample was selected of them who are the

customers/visitors of State Bank if India, Bor ing

Canal Road Branch, irrespective of them being

investors or not or availing the services or not. It

was also collected through personal visits to

persons, by formal and informal talks and

through f illing up the questionnaire prepared.

The data has been analyzed by usingmathematical/Statistical tool.



Sample size:

The sample size of my project is limited to

100 people only. Out of which only 35 peoplehad taken the life insurance. Other 65 people

already took that policy. Limitation:

1.Some of the persons were not so responsive.

2. Possi bility of error in data collection because many of

investors may have not given actual answers of my

questionnaire.

3. Some respondents were reluctant to divulge personalinformation which can affect the validity of all

responses.



4. The research is conf ined to a certain part of Patiala.

CHAPTER ± 6

FINDING &

CONCLUSION



Finding

y In Patiala in the Age Group of 36-40 years were morein numbers. The second most Investors were in the

age group of 41-45 years and the least were in the agegroup of below 30 years.

y In Pat iala most of the Investors were

Gradua te or Pos t Gradua te and below HSCthere were very few in numbers.

y I n O c c u p a t io n g r o u p m o s t o f t h e

I n v e s t o r s w e r e G o v t . e m p l o y e e s , t h esecond most Investors were Pr ivate employeesand the least were associated with Agr iculture.

y I n f a m i l y I n c o m e g r o u p , b e t w e e n R s .2 0 , 0 0 0 - 3 0 , 0 0 0 w e r e m o r e i n numbers, thesecond most were in the Income group of more than

Rs.30, 000 and the least were in the group of below Rs.10,000.



y Almost all people take the life insurances policy.

Because now that is very important because it give the

secure life.

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