A PROJECT REPORT
“Agency recruitment at ICICI PRUDENTIAL Life Insurance Company”
Education and learning knows no bars or inhibitions. It is rather a never-ending process.
Similarly after completing almost one year in MBA from I.M.S., B.J.S.R. Jain College, Bikaner, the study
conducted by me as part of my course curriculum has proved an exceptional enhancement of knowledge
and learning for me.
The completion of the project would not have been possible without the help of some persons.
Without their contribution, the study could not have been comprehensive and a profound one.
At the very outset, I sincerely thank my faculty guide Dr , Director Mr. S.K JAIN,,
Faculty whose continuous support and guidance proved an effective impetus to my study.
I am greatly indebted to my project guide Mr. SAURABH SHARMA branch Manager for
their help and encouragement.
I would also like to thank my family and my friends for their guidance and support, which
helped me in every step during the course of my study.
Above all, I thank god for his blessings without which I would not have been able to complete
TO WHOM SO EVER IT MAY CONCERN
It is to certify that monica rathorehas undertaken his summer training at
ICICI PRUDENTIAL,bikaner. He has completed his summer training project
on the topic “Agency recruitment at ICICI Life Insurance Company” under
my supervision and guidance.
To the best of my knowledge his work is genuine and satisfactory. I wish
him all the best in his future endeavors.
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 53000 advisors and it
is planning to extend this number to 73000 by the end of the year 2007-08.
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.
“Agency recruitment at ICICI PRUDENTIAL LIFE INSURANCE
To study recruitment process at ICICI PRUDENTIAL LIFE INSURANCE COMPANY.
To study the current life insurance market scenario.
To study and formulate necessary criteria required being successful life advisors and
offering necessary suggestions to the company.
For the purpose of study of Agency recruitment at ICICI PRUDENTIAL life insurance
Company, the researcher has given BOP, telephonic conversations to the people for recruitment.
For studying the current insurance market scenario, an exhaustive study and compilation
of report was done from the data provided by the company form their database besides using
other sources like yellow pages, reference data.
For studying the necessary criteria required to be a successful life advisor, a study was
made on the topic of analyzing the current set of criteria set up the company for recruiting the
Sources of Data:
Source of primary data
1. Natural Market
2. Stall Operation
4.Seminar (Focus Group)
Source of Secondary Data
1. Yellow Pages
2. Database of different companies LIGI Agents
3. Telecalling leads
4. Reference data.
Initially, the instructions given by the company were to work on natural market Company, i.e.
relatives, friends, neighbors or the known ones. But being new to the city, this constraint of not having the
natural market was there. One of the methods used in recruitment was to call people from Yellow Pages
and take their appointments. Once the meeting is fixed with that person, then a B.O.P i.e. Business
Opportunity Presentation has to be given to him. This presentation helps to a great extent in making that
person know about the Company, the benefits that he/she will get in getting associated with the Company.
It just happens sometimes that a person might not concentrate on what is being told to him but when that
person looks at that presentation it becomes easy to convince him as he is focused on the facts and figures
mentioned in the presentation.
Another method that can be followed to recruit agents for the company is that of leads which are given by
the Company. These are those people who have shown their interest in having the agency to the
telecallers. Once those people are interested, an appointment has to be fixed with them and explain them
in detail about the agency business and answering their queries.
The third method that can be followed is that of making cold calls to corporate offices, shops or those
people whom a student feels can become advisors or who might be interested in becoming advisors. Here,
the duty is to tell them about agency business, what they will get out of it and finally closing the deal. If
they still have some queries or questions which could not be answered at that point of time, then they are
requested to visit our office so that they may enquire about their doubts from Unit Managers and thus
making them satisfied that their association with the Company is something which they will not regret.
This method is also called PROSPECTING.
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.
To study recruitment process at ICICI PRUDENTIAL LIFE INSURANCE COMPANY.
To study the current life insurance market scenario.
To study and formulate necessary criteria required being successful life advisors
and offering necessary suggestions to the company.
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
Sometimes, fresh graduates want to become advisors but the company denies making them an
advisor as they are very fickle-minded and also unreliable.
There is a problem in targeting Chartered Accountants. ICAI, which is the governing body of
Chartered Accountants, does not allow them to become advisors. However, now they have
permitted some CA’s to become advisors, but these are only those ones who are doing jobs
somewhere and not allowed the ones who are doing their practice. So, still this decision is
Sometimes, even those people want to become advisors for the company who are not a
localite but then the major problem that they face is that they have got no natural market, so
they are very susceptible about their performance and whether they will be able to generate
business for the company or not, so they avoid to take up this challenge.
It was a great problem to get appointments from people in the month of March as most of
them were busy in filing their returns.
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.
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.
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
Certificate from the guide
Certificate from the company
1.1 History of Life Insurance..................................................
1.2 Life Insurance Market………………………………......
1.3 Definition of Life Insurance.............................................
1.4 Why Do You Need Insurance……………………...........
1.5 Benefits of Life Insurance……………………………….
1.6 Life Insurance v/s Other Investments...............................
1.7 Role of Life Insurance.......................................................
1.8 Introduction to the Company...........................................
1.9Products and Services.........................................................
CHAPTER2: PROJECT PROFILE
2.2 Significance of the study..…………………………
2.4 Contact Method………………………….................
CHAPTER3 : FACT AND FINDINGS………………………………………….
CHAPTER4 : SUGGESTIONS …………………………………………………
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
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
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.
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
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.
1.1 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 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).
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-term debt and equity for infrastructure
projects. With long-term liability, they get a good asset- liability match by investing their funds in such
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
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 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.
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
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
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 (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.
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
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
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
(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 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.
1.2 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 2000 crores in 2005- 06 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. 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.
1.3 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
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 is that which provides protection against the economic loss caused by the death of the person
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 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.
1.4 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
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.
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 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.
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.
1.5 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
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.
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
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.
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.
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
1.6 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
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 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.
1.7 ROLE OF LIFE INSURANCE
Security and Stability
Preservation of Health
Planning of future
Safe guard against statutory liability
Capitalization of earning capacity
Exemption from Tax Liability
Safety to Investment Mode.
1.8 INTRODUCTION TO THE COMPANY
ICICI (Industrial Credit and Investment Corporation of
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, established ICICI LTD., in 1955.
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
Organizational structure of ICICI
ICICI PRUDENTIAL LIFE INSURANCE
Under this topic, the major headings that will be covered are as under:
Mission & Vision
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 11.75 Bn
with ICICI Bank & Prudential Plc. In the end of year 2006-07, ICICI Prudential had issued over 17.8 lacs
policies, for a total sum assured of over 29000 crores and premium collection is over 2351 crores.
The company has a network of about 53000 advisors: as well as 12 bankassurance tie-ups. Today the
company stands first in private life insurance in India with a market share of nearly 40%.
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-
• Customer First,
Each of the core values describe what the company stands for, the qualities of their people and the
way they work.
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
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%.
The Bank ’s net customer assets in reased 47%to Rs.163,785 crore (US$
35.7 billion)at September 30,2006 compared to Rs.111,514 crore (US$
24.3 billion)at September 30,2005.The Bank maintained its growth
momentum and market leadership in the retail segment.In H1-2007,the
Bank ’ s total retail disbursements were about Rs.33,500 crore (US$7.3
billion)including home loan disbursements of about Rs.13,400 crore
(US$2.9 billion).Retail assets constituted 69%of advances and 66%of
customer assets.The Bank is focusing on non-fund based products and
servi es,as well as capitalising on opportunities presented by the
domestic and international expansion of Indian ompanies.The Bank is
also extending its reach in the small and medium enterprises segment.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
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
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).
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
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, Taiwan, Thailand and Vietnam.
Solid reputation built over 150 years.
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.
THE PRIVATE LINE UP
Birla Sun Life Allianz Bajaj
Om Kotak SBI Life ING Vysya
Met Life AMP Sanmar Tata AIG
AVIVA Life ICICI Pru Max NYL
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 Per
Insurer Issued Policy
Feb-07 Apr-Feb 07 Feb-07 Apr-Feb 07 Feb-07 Apr-Feb 07
1 ICICI 13900 59714 83752 360511 16922 19949
2 TATA AIG 3754 16287 18368 138990 17826 12429
3 OM KOTAK 1174 7961 5789 41925 22328 19882
4 BIRLA SUNLIFE 6248 25752 21792 114254 29514 22050
5 MAX NEW YORK 1720 10818 18437 119351 8030 9163
6 ING VYSYA 982 4717 8815 59725 8702 7827
7 HDFC 2818 17002 20958 170769 11939 9242
8 MET LIFE 469 2028 3112 21497 11225 10377
9 ALLIANZ BAJAJ 3118 13397 18168 162536 13694 9996
SBI 2237 11817 12125 62121 22315 21323
Market Share of Private Players in Terms of Premium Upto Feb'04
4% 1% 9%
ICICI PRUDENTIAL SBI
AVIVA AMP SANMAR
ALLIANZ BAJAJ OM KOTAK
BIRLA SUNLIFE MAX NEW YORK
ING VYSYA HDFC STANDARD
MET LIFE TATA AIG
Market Share of Private Players in Terms of No.Of Policies upto
Feb ' 04
ICICI PRUDENTIAL SBI
AVIVA AMP SANMAR
ALLIANZ BAJAJ OM KOTAK
BIRLA SUNLIFE MAX NEW YORK
ING VYSYA HDFC STANDARD
MET LIFE TATA AIG
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
The Bank ’s capital adequacy at September 30,2006 was 14.3%(including
Tier 1 apital adequacy of 9.4%),well above RBI ’ s requirement of total
capital adequacy of 9.0%.The Bank ’ s unaudited capital adequacy
estimated based on RBI ’s draft guidelines issued in February 2005 on
implementation of the revised capital adequacy framework (Basel II),was
about 14.9%(including Tier 1 apital adequacy of about 10.5%)at
At September 30,2006,the Bank ’ s net non-performing assets onstituted
0.9%of customer assets against 1.0%at September 30,2005.The Bank ’s
net restructured loans at September 30,2006 were Rs.4,942 crore (US$
1.1 billion),down from Rs.5,713 crore (US$1.2 billion)at September 30,
• ORGANIZATION STRUCTURE,
DEPARTMENTATION AND DETAILS OF
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:
Ms. Shikha Sharma
Mr. M.S.Khanan Mr. Bhargav Ms.Anita Pal
Executive Dir. Dasgupta,
Mr. V.Rajagopalan Mr.Azim Mithani Mr.Puneet Nanda
Appointed Actury Chief Actuary Chief Inv.Officer
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. Barry Stowe
Mrs. Lalita D. Gupte
Mrs. Kalpana Morparia
Mr. HT Phong
Mrs. Chandana Kochhar
Mr. Kevin Holmgren
Mr. M. P. Modi
Mr. R. Narayanan
Mr. N. S. Kannan, Executive Director
Mr. Bhargav Dasgupta, Executive Director
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 1992-1997,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.
• FINANCIAL PERFORMANCE OF THE
Prudential ICICI Asset Management Company continues to be among the
top two asset management companies in India with assets under
management of over Rs.30,000 rore (US$6.5 billion)at September 30,
Summary Profit and Loss Statement
Q2-2006 Q2-2007 Growth over H1-2006 H1-20 FY2006
Net interest income 1 1,070 1,577 47% 2,039 3,052 4,709
Non-interest income 871 1,283 47% 1,779 2,473 4,056
-Fee income 704 1,138 62% 1,363 2,123 3,259
-Lease &other 167 145 (13%) 416 350 797
Operating expense 816 1,157 42% 1,587 2,237 3,547
Expenses on direct 257 327 27% 511 718 1,177
Lease depre iation 64 51 (20%) 128 102 277
Core operating profit 804 1,325 65% 1,592 2,468 3,763
Treasury income 240 287 20% 423 375 928
Operating profit 1,044 1,612 54% 2,015 2,843 4,691
Less:Provisions 2,3 304 709 133% 602 1,192 1,594
Profit before tax 740 903 22% 1,413 1,651 3,097
Less:Tax 303 160 148 (8%) 276 557
Profit after tax 580 755 30% 1,110 1,375 2,540
1.Includes perpetual debt allable with regulatory approval at the end of 10 years from
issue,qualifying as Tier-1 apital,aggregating Rs.2,271 crore.
Ex ept for the historical information ontained herein,statements in this Release
which contain words or phrases such as 'will','would',‘indicating ’,‘expe ted to ’ et .,
and similar expressions or variations of such expressions may onstitute 'forward-
looking statements'.These forward-looking statements involve a number of risks,
uncertainties and other factors that ould ause a tual results to differ materially
from those suggested by the forward-looking statements.These risks and
uncertainties include,but are not limited to our ability to suc essfully implement
our strategy,future levels of non-performing loans,our growth and expansion in
business,the impact of any a quisitions,the adequacy of our allowance for credit
losses,technological implementation and hanges,the actual growth in demand for
banking products and services,investment income,ash flow proje tions,our
exposure to market risks as well as other risks detailed in the reports filed by us
with the United States Se urities and Exchange Commission.ICICI Bank undertakes
no obligation to update forward-looking statements to reflect events or
circumstances after the date thereof.
1.9 PRODUCTS AND SERVICES
The topics covered under this are:
Product Life Cycle
Segmentation and positioning strategies
Communication strategies and media analysis
Distribution and channel management
• 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:
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 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.
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.
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.
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
3. Premier Life is a limited premium-paying plan that offers customers life insurance cover till
the age of 75.
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
3. LifeTime Pension II is a regular premium market-linked pension plan.
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.
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
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
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
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
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.
• 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
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 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
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
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.
• 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.
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
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.
• DISTRIBUTION AND CHANNEL
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:
• 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 53,000 agents, which contribute the greatest
percentage of business. Alternate channels such as corporate agents and bank relationships contributed
nearly 30% of business in 2006.
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.
The company has 11 bankassurance 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
Bankassurance in its simplest form is the distribution of insurance products through a bank's
distribution channels. In concrete terms bankassurance, 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 bankassurance also vary. For banks, it is a means of product
diversification and a source of additional fee income. Insurance companies see bankassurance as
a tool for increasing their market penetration and premium turnover. The customer sees
bankassurance 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 Bankassurance 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 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
“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 bankassurance 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
(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 bankassurance 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 bankassurance
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 bankassurance in India.
With a multichannel distribution approach where insurance is woven into delivery
channel of the bank, this is India’s most advanced bankassurance model. M. S.
Chanda Kochhar, Executive Director ICICI Bank, in recent interview with
prudential corporation, discussed the ICICI Bank experience with bankassurance.
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.
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
(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
Mr. S. R. Sinha, Senior Vise- President, Lord Krishna Bank on the tie up with ICICI
prudential. “The concept of bankassurance 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.
Shri. A. Sethum A.Dhavan, Chairman & CEO of The South Indian Bank Ltd says
“Bankassurance 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.”
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 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:
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.
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
Bankassurance & Alliances
Corporate Agency & 10
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 14,02,149 agents and 2248 branch offices as on 31st march 2007.
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 12th pass. As we have seen, company’s major business comes
from this channel. ICICI Prudential is immensely concentrating on developing this channel. It has 53,000
advisors and it is planning to extend this number to 74000 by the end of the year 2006 – 2007. 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.
ICICI Prudential has recruited and trained over 53,000 insurance agents to interface with and advise
customers. Further, it leverages its state-of-the-art IT infrastructure to provide superior quality of service
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
The following table shows the way the company has grown from 2001 to 2004:
Financial Year Cities Branches
2004 54 70
2006 84 97
2004 115 109
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
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 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