One Stop Shop For All

Finance, Tax and

Insurance Needs

Through Life Insurance

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 1

 INDIAN INSTITUTE OF PLANNING
AND MANAGEMENT, NEW DELHI

PROJECT REPORT

External Guide: Submitted By:

Mr. Sanjay Tyagi Aditi Saini
Manager - Priority Clients SS 2004-06
ICICI Prudential

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 2

 ACKNOWLEDGEMENT

It is with a sense of immense pride and satisfaction that I am

here to pen down my project report. I therefore will like to pay
my special thanks to our Director-Mr.M.K.Chaudhary,
Mr.Arindam Chaudhary and the Dean Mr.Prasoon Majumdar.
Through this esteem column of this project, I would like to
thank all those who have contributed in the successful
completion of this project by giving benevolent consult, co-
operation and guidance.

I have profound pleasure in expressing my deep sense of

gratitude and feeling to our external guide Mr.Sanjay Tyagi,
Manager-Priority Clients for his timely help inspiring noble
and expert guidance, striculative and constructive criticism,
constant encouragement and helpful attitude which led easy
completion of task.

This acknowledgement will remain incomplete without a word

of special thanks to Dr. Asha Jain who advised me the area for
project, keeping in mind high prospects of insurance and
marketing of insurance products. Her excellent guidance,
helpful advices played a vital role in completion of this
project.

Last but not the least I sincerely thank to all those who
remained unmentioned here.

(ADITI SAINI)

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 3

 TABLE OF CONTENTS

Objective 5

Research Strategy 6

Executive Summary 7

About ICICI Prudential 8

ICICI Prudential Priority Circle 13

ICICI control structure 15

Insurance Introduction 18

Common types of Insurance 19

About IRDA 22

The global insurance industry 27

Life insurance market in India 29

Products and Services snapshot 31

About Income Tax 35

Portfolio Management 40

Nature of Job as a Trainee 41

Limitations 43

Bibliography 44

Annexure 45

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 4

 OBJECTIVE

The main objective of the project is to understand the practices adopted

by insurance industry by working with ICICI PRUDENTIAL. The
study involves understanding and implementation of the various options
available to companies and individuals for better financial management,
tax planning and life insurance.

Sub-objectives may be stated as:

1. To get an exposure of various financial products of ICICI prudential

2. Fact finding of the client for his assets and liabilities and therefore

helping him meet his financial goals, retirement benefits and savings
on the tax favored basis.

3. To deal directly with clients and to assist them in their tax planning by

helping them invest in various financial tools like insurance, PPF,

shares, NSE, equity, mutual funds etc.

4. To make the clients aware about various corporate tax planning

solutions provided by ICICI prudential

5. To recruit the channel members as financial advisors

6. To help the financial advisors plan better financial needs and goals
for their clients.

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 RESEARCH STRATEGY

• In the first week the main emphasis was on the recruitment of

financial advisors, along with it I gained knowledge about various
financial products of ICICI prudential.

• Further during the mid part of my project I gave emphasis on selling

individual insurance policies from the product portfolio of the
company which also included Keyman Insurance and Employer
Employee Insurance scheme.

• In the last two weeks I did the portfolio management of individual

clients and along with it I started the analysis of my project.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 6

 EXECUTIVE SUMMARY

Insurance is a system to alleviate financial losses by

transferring risk of loss from one entity to another. Earlier
there was only Life Insurance Corporation of India (LIC) who
was taking the burden of insuring people from certain and
uncertain risk. This was the scenario before a regulatory
authority was introduced. After the formation of IRDA, by an
act of parliament, that is Insurance Regulatory Development
Authority, many private players attacked the market. There are
14 new players who joined LIC in the Indian Insurance market.

ICICI started its journey in 2001 after a tie up with U.K

insurance company Prudential UK. and in a span of 4 years it
has grown in a tremendous pace. Today it is no.1 private
insurance player in the market and has huge potentials to grow
further. There are number of products to satisfy customers
needs and gives products according to their needs.

ICICI priority circle is an exclusive branch of ICICI

Prudential, which deals with high net worth individuals. The
managers here appoint financial advisors after a tough
selection process. These advisors are then trained and after
getting an IRDA license start soliciting insurance. This
business is based on trust and relationship building.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 7

 ABOUT ICICI PRUDENTIAL

ICICI Prudential Life Insurance Company is a joint venture

between ICICI Bank, a premier financial powerhouse and
Prudential plc, a leading international financial services group
headquartered in the United Kingdom. ICICI Prudential was
amongst the first private sector insurance companies to begin
operations in December 2000 after receiving approval from
Insurance Regulatory Development Authority (IRDA).

ICICI Prudential's equity base stands at Rs. 9.25 billion with

ICICI Bank and Prudential plc holding 74% and 26% stake
respectively. In the financial year ended March 31, 2005, the
company garnered Rs 1584 crore of new business premium for
a total sum assured of Rs 13,780 crore and wrote nearly
615,000 policies. The company has a network of about 56,000
advisors; as well as 7 banc assurance and 150 corporate agent
tie-ups. For the past four years, ICICI Prudential has retained
its position as the No. 1 private life insurer in the country,
with a wide range of flexible products that meet the needs of
the Indian customer at every step in life.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 8

Our Vision:
To make ICICI Prudential the dominant Life and Pensions
player built on trust by world-class people and service.
This we hope to achieve by:
• Understanding the needs of customers and offering
them superior products and service
• Leveraging technology to service customers
quickly, efficiently and conveniently
• Developing and implementing superior risk
management and investment strategies to offer
sustainable and stable returns to our policyholders
• Providing an enabling environment to foster growth
and learning for our employees
• And above all, building transparency in all our
dealings.

The success of the company will be founded in its unflinching

commitment to 5 core values -- Integrity, Customer First,
Boundary less, Ownership and Passion. Each of the values
describes what the company stands for, the qualities of our
people and the way we work.

We do believe that we are on the threshold of an exciting new

opportunity, where we can play a significant role in redefining
and reshaping the sector. Given the quality of our parentage
and the commitment of our team, there are no limits to our
growth.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 9

Promoters
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 YOU. Riding
on the success of this relationship, the two companies joined
hands once more in 2000, to form ICICI Prudential Life
Insurance, with a commitment to provide leading-edge life
insurance solutions.

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

ICICI Bank (NYSE:IBN) is India’s second largest bank with

an asset base of Rs. 106812 crore. ICICI Bank provides a
broad spectrum of financial services to individuals and
companies. This includes mortgages, car and personal loans,
credit and debit cards, corporate and agricultural finance. The
Bank services a growing customer base of more than 7 million
customer accounts and 5 million bondholders’ accounts
through a multi-channel access network. This includes about
450 branches and extension counters, 1675 ATMs, call centres
and Internet banking. ICICI Bank posted a net profit of Rs.1,
206 crore for the year ended March 31, 2003. ICICI Bank is
the only Indian company to be rated above the country rating
by the international rating agency Moody’s and the only Indian

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 10

company to be awarded an investment grade international
credit rating. The Bank enjoys the highest AAA (or
equivalent) rating from all leading Indian rating agencies.

Established in 1848, Prudential plc is a leading international

financial services company in the UK, with around US$250
billion funds under management and more than 16 million
customers worldwide. Prudential has brought to market an
integrated range of financial services products that now
includes life assurance, pensions, mutual funds, banking,
investment management and general insurance. In Asia,
Prudential is Auk’s largest life insurance company with a vast
network of 22 life and mutual fund operations in twelve
countries - China, Hong Kong, India, Indonesia, Japan, Korea,
Malaysia, the Philippines, Singapore, Taiwan, Thailand and
Vietnam. Since 1923, Prudential has championed customer-
centric products and services, supported by over 60,000 staff
and agents across the region.

ABOUT THE PROMOTERS

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

about Rs.112,024 crore and a network of about 450 branches
and offices and about 1750 ATMs. It offers a wide range of
banking products and financial services to corporate and retail
customers through a variety of delivery channels and through
its specialized subsidiaries and affiliates in the areas of
investment banking, life and non-life insurance, venture
capital, asset management and information technology. ICICI

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 11

Bank posted a net profit of Rs.1,637 crore for the year ended
March 31, 2004. ICICI Bank's equity shares are listed in India
on stock exchanges at Chennai, Delhi, Kolkata and Vadodara,
the Stock Exchange, Mumbai and the National Stock Exchange
of India Limited and its American Depositary 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, policyholder and unit holders worldwide.
As of June 30, 2004, the company had over US$300 billion in
funds under management. Prudential has brought to market an
integrated range of financial services products that now
includes life assurance, pensions, mutual funds, banking,
investment management and general insurance. In Asia,
Prudential is the leading European life insurance company
with a vast network of 24 life and mutual fund operations in
twelve countries - China, Hong Kong, India, Indonesia, Japan,
Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand
and Vietnam

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 ICICI PRUDENTIAL PRIORITY CIRCLE

THE PRIORITY CIRCLE

Priority circle is an opportunity to diversify the business and
widen the gamut of services and solutions offered to the
clients. One can now enhance the business with capital
investment and yet earn high returns. Step into the arena of
private life insurance, one of the most dynamic industries
today with Priority Circle of ICICI prudential life insurance
company ltd, the leader in today’s private life insurance
industry.

The vast reach

• 91 branches spread over 61 locations
• A committed team of tied and corporate agents,
brokers, banks and call centre executives
• An advisor force of more than 46000 agents.
• Tie ups with India’s leading banks like ICICI bank,
Bank of India, federal bank and south Indian bank.

ICICI prudential customers enjoy the privilege of approaching

the company as per their convenience. Its vast reach across
India places the company far ahead of its pears.
The pleasant experience service

The company maintains its undisputed leadership by

proactively achieving superior risk adjusted returns on its
funds. The prime focus is on ensuring long term safety,

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 13

profitability, stability of the portfolio. Quality service at ICICI
Pru is not an isolated function but a practice. From people and
products to process at every stage of the policy, it is an
experience for the customers so everyone’s a customer service
associate including you.

THE ADVISORS
An advisor at ICICI Prudential is one of the main strengths of
the company. It’s a partnership that results in unlimited
growth opportunity with the company.

THE ROLE
To identify prospective customers, provide tailor-made
solutions to cater to their individual needs, conduct regular
reviews to keep customers on track and last but not the least
achieve targets,

THE BENEFIT
A premium product portfolio that caters to a wide range of
financial needs, excellent back-end support, attractive returns
and benefits, round the clock customer service and extensive
training for that edge over the competition

THE ADVANTAGE
No start up capital, no supervisor, flexible working
environment and an unlimited earning potential.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 14

 ICICI PRUDENTIAL PRIORITY CIRCLE CONTROL
STRUCTURE

The control structure of ICICI Prudential Priority Circle goes

like this:

COUNTRY
HEAD

HIMALAYAS AND
PENINSULA
SALES HEAD

ZONAL HEAD

TERRITORY
MANAGER

MANAGER –
PRIORITY
CLIENTS

As a whole till Zonal Head the levels are same in all sectors of
ICICI but after that when comes the Territory Manager, the
unique levels of Priority Circle begins.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 15

Under the Country Head come 2 regions:
1. Peninsula
2. Himalayas

Under those come there respective Sales Head, Zonal Head,

Territory Manager, Manager – Priority Clients.

Management Team:

Country Head (CEO) : Mrs. Shikha Sharma.

Himalayas Sales Head : Mr. Chander Chalani.
Zonal Head : Mr. Vikas Seth.
Territory Manager : Mr. Sumeet Sahni
Manager – Priority Clients : Mr. Sanjay Tyagi

The MPC’s are not allowed to sell insurance directly, but they
have to go through the advisors under them.

The advisors under the MPC’s are the High Network

Individuals which bring business. They are selected by the
MPC’s by completing certain formalities.

The person has to pay Rs. 1500/- for becoming an Advisor.

That person is given an 8 days intensive training in which he
is also given product details.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 16

After the training is over the person has to give an
examination named as IC 33 taken by Insurance Regulatory
and Development Authority.
Once the person clears his examination a code is generated in
his name. The person know becomes an Advisor and is ready
to bring business.

INSURANCE INTRODUCTION

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 17

MEANING OF INSURANCE
Insurance is device for indemnifying or guaranteeing an
individual against loss. Reimbursement is made from a fund to
which many individuals exposed to the same risk have
contributed certain specified amounts, called premiums.
Payment for an individual loss, divided among many, does not
fall heavily upon the actual loser. The essence of the contract
of insurance, called a policy, is mutuality.

The entity that is transferring the risk — which may be an

individual or association of any type, including a government
or government agency — is called the "insured". The entity
accepting the risk is called the "insurer". The agreement
between the two by which the risk is transferred is called the
"policy": This is a legal contract that sets out exactly the terms
and conditions of the coverage. The fee paid by the insured to
the insurer for assuming the risk is called the "premium". This
is usually determined by the insurer to fund estimated future
claims paid, administrative costs, and profit.

COMMON TYPES OF INSURANCE

COMMON TYPES OF INSURANCE

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 18

• Life Insurance:

Life insurance, originally conceived to protect a man's family when

his death left them without income, has developed into a variety of
policy plans.

• Whole Life:

In a “whole life” policy, fixed premiums are paid throughout the

insured's lifetime; this accumulated amount, augmented by compound
interest, is paid to a beneficiary in a lump sum upon the insured's
death; the benefit is paid even if the insured had terminated the policy.

• Universal Life:

Under “universal life,” the insured can vary the amount and timing
of the premiums; the funds compound to create the death benefit.

• Variable Life:

With “variable life,” the fixed premiums are invested in a portfolio

(with earning reinvested), and the death benefit is based on the
performance of the investment.

• Term Life:

In “term life,” coverage is for a specified time period (e.g., 5–10

years); such plans do not build up value during the term. Annuity
policies, which pay the insured a yearly income after a certain age,
have also been developed. In the 1990s, life insurance companies
began to allow early payouts to terminally ill patients.

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• Fire Insurance:

Fire insurance usually includes damage from lightning; other

insurance against the elements includes hail, tornado, flood, and
drought.

• Automobile Insurance:

Automobile insurance includes not only insurance against fire and

theft but also compensation for damage to the car and for personal
injury to the victim of an accident (liability insurance); many car
owners, however, carry only partial insurance. In many states liability
insurance is compulsory, and a number of states have instituted so-
called no-fault insurance plans, whereby automobile accident victims
receive compensation without having to initiate a liability lawsuit,
except in special cases.

• Title Insurance:

Title insurance is aimed at protecting purchasers of real estate from

loss by reason of defective title.

• Credit Insurance:

Credit insurance safeguards businesses against loss from the failure

of customers to meet their obligations.

• Marine Insurance:

Marine insurance protects shipping companies against the loss of a

ship or its cargo, as well as many other items, and so-called inland

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 marine insurance covers a vast miscellany of items, including tourist
baggage, goods in transit, and even bridges and tunnels. In recent
years, the insurance industry has broadened to guard against almost
any conceivable risk; companies like Lloyd's will insure a dancer's
legs, a pianist's fingers, or an outdoors event against loss from rain on
a specified day.

INSURANCE REGULATORY DEVELOPMENT AUTHORITY

(IRDA)

Prior to 1999 the there were only two players in the market

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 21

Life Insurance Corporation of India (LIC)

General Insurance Corporation (GIC)

Then to protect the interests of the policyholders, to regulate, promote

and ensure orderly growth of the insurance industry, IRDA was set up.
After this the private players started entering the market.

Steps taken by IRDA to safe guard the policy holders

While entering the insurance business

• The applicant company has to

• Particulars of the partners in the joint venture (company name ,
address, name of directors etc)
• Constitution of the promoter companies –details of share holders
holding in excess of 1% of the share capital
• Nature of business, years in business of the promoter companies.
• Part record of regulatory interventions / restrictive directions in
respect or promoter companies
• The applicant’s reasons for entering the insurance market
• Financial strength for the last 5 year and strength of the partners
• Indication of the degree of commitment to the Indian market place
displayed by the applicant
• The agreement of the share holders promoting the company
• The obligations undertaken by the foreign promoters
• The obligations of the applicant company to the foreign promoters
• Sources of meeting the initial and future capital needs
• Full details of the directors and the key person’s reputation and
character

Investment Norms

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 22

 • Every Insurer shall make its own investment policy and
they have an investment committee Responsibility rests
with the Investment Committee of the company
• Review and approval of investment policy by the Board
of Directors (annually or otherwise)
• Appointed Actuary to ensure that investment policy and
guidelines are complied with

INVESTMENT OF CONTROLLED FUNDS AS PER IRDA

GUIDELINE

Infrastructure
State & Sector. Not less
and Social
Government
Central than 15%
(Rating:
Securities.
Not less
Sovereign)
than 50%

Others governed by
(Investments
exposure allowed in the
norms.
Not exceeding
Stock Market) 35%
Government Securities
Rating: Sovereign
80 Infrastructure and Social
% Rating:
Sector.
AAA/AA+ 16
%

MNYL’s portfolio of Investments

Nationalized
INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 23
Rating:AA
Bank
A 4
Composition of Authority under IRDA Act, 1999

As per the section 4 of IRDA Act' 1999, Insurance Regulatory and

Development Authority (IRDA, which was constituted by an act of
parliament) specify the composition of Authority
The Authority is a ten member team consisting of :

• A Chairman;
• Five whole-time members
• Four part-time members,

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 24

Life Insurers:

S. Reg. Date of Name of the Company

No Number Reg.
1 101 23.10.200 HDFC Standard Life Insurance
0 Company Ltd.
2 104 15.11.200 Max New York Life Insurance Co.
0 Ltd.
3 105 24.11.200 ICICI Prudential Life Insurance
0 Company Ltd.
4 107 10.01.200 Kotak Mahindra Old Mutual Life
1 Insurance Limited
5 109 31.01.200 Birla Sun Life Insurance Company
1 Ltd.
6 110 12.02.200 Tata AIG Life Insurance Company
1 Ltd.
7 111 30.03.200 SBI Life Insurance Company
1 Limited .
8 114 02.08.200 ING Vysya Life Insurance
1 Company Private Limited
9 116 03.08.200 Bajaj Allianz Life Insurance
1 Company Limited
10 117 06.08.200 Metlife India Insurance Company.
1

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 25

Life Insurers:

S.No. Registratio Date of Name of the Company

n Reg.
Number
1 121 03.01.2002 AMP Sanmar Life Insurance
Company Limited.
2 122 14.05.2002 Aviva Life Insurance Co.
India Pvt. Ltd.

Life Insurers:

S.No Registration Date of Name of the Company

Number Reg.
1 127 06.02.2004 Sahara India Insurance Co.
Ltd.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 26

 THE GLOBAL INSURANCE INDUSTRY

The insurance industry forms an integral part of the global

financial market, with insurance companies being significant
institutional investors. In recent decades, the insurance
sector, like other financial services, has grown in economic
importance. This is through direct contributions to gross
domestic product (GDP) via increased levels of employment
within the sector; and indirectly through higher levels of risk
transfer and financial intermediation.

Insurance companies, engage in underwriting, managing, and

financing risks. According to Sigma (2001) the largest
insurance sectors are to be found in the U.S. and Japan, which
together generates more than 50% of global premium income;
followed by the UK, Germany, France and Italy. Furthermore,
during the last four decades the global insurance sector has on
average outpaced global economic growth.
Between 1984 and 2001, the global insurance industry grew at
an overall rate of 483.6%(roughly comprising of 664.8% from
the life insurance sector, and 334.3% from the non- life sector).
In contrast to the life insurance sector, which has continued to
grow at a fast rate. Sigma (2002a) estimates this to be in the
region of 5.4 percent worldwide since 2000. Measured in total
premiums, OECD countries accounted for 95.52% and 93.99%
of the life insurance business, and 91.19% and 92.50% of non-
life insurance premium volume in 1994 and 2001, respectively.

Outside of the OECD, a more recent development since the

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 27

early nineties has been the ability of the emerging markets to
strengthen their global market share in the life insurance
segment, with growth rates often reaching double-digit
figures. Furthermore, insurance markets within the OECD
countries have faced falling premium income, reduced capital
market yields and low interest rates, all of which has put
insurers under some pressure (Sigma, 2002a). Also, the
growing importance of the insurance industry in emerging
markets is reflected in growing insurance density and
insurance penetration of the non-OECD insurance markets
(Sigma, 1996, 2001). Nevertheless, and despite these
developments, emerging markets still have some way to go
before matching the relative sizes and importance that the
insurance industry has in industrialized countries.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 28

LIFE INSURANCE MARKET IN INDIA

Many may not be aware that the life insurance industry of

India is as old as it is in any other part of the world. The first
Indian life insurance company was the Oriental Life Insurance
Company, which was started in India in 1818 at Kolkata. A
number of players (over 250 in life and about 100 in non-life)
mainly with regional focus flourished all across the country.

However, the Government of India, concerned by the unethical

standards adopted by some players against the consumers,
nationalised the industry in two phases in 1956 (life) and in
1972 (non-life). The insurance business of the country was
then brought under two public sector companies, Life
Insurance Corporation of India (LIC) and General Insurance
Corporation of India (GIC).

In line with the economic reforms that were ushered in India

in early nineties, the Government set up a Committee on
Reforms (popularly called the Malhotra Committee) in April
1993 to suggest reforms in the insurance sector. The
Committee recommended throwing open the sector to private
players to usher in competition and bring more choice to the
consumer. The objective was to improve the penetration of
insurance as a percentage of GDP, which remains low in India
even compared to some developing countries in Asia.

Reforms were initiated with the passage of Insurance

Regulatory and Development Authority (IRDA) Bill in 1999.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 29

IRDA was set up as an independent regulatory authority,
which has put in place regulations in line with global norms.
So far in the private sector, 12 life insurance companies and 9
general insurance companies have been registered

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 30

 PRODUCTS AND SERVICES SNAPSHOT

Insurance Solutions for Individuals

ICICI Prudential Life Insurance offers a range of innovative,
customer-centric products that meet the needs of customers at
every life stage. Its 20 products can be enhanced with up to 6
riders, to create a customized solution for each policyholder.
Savings Solutions
• SecurePlus is a transparent and feature-packed savings
plan that offers 3 levels of protection.
• CashPlus is a transparent, feature-packed savings plan
that offers 3 levels of protection as well as liquidity
options.
• Save n Protect is a traditional endowment savings plan
that offers life protection along with adequate returns.
• CashBak is an anticipated endowment policy ideal for
meeting milestone expenses like a child’s marriage,
expenses for a child’s higher education or purchase of an
asset.
• LifeTime & LifeTime II offer customers the flexibility
and control to customize the policy to meet the changing
needs at different life stages. Each offer 4 fund options
Preserver, Protector, Balancer and Maximiser.
• LifeLink II is a single premium Market Linked
Insurance Plan which combines life insurance cover with
the opportunity to stay invested in the stock market.
• Premier Life is a limited premium paying plan that
offers customers life insurance cover till the age of 75.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 31

 • InvestShield Life is a Market Linked plan that provides
capital guarantee on the invested premiums and declared
bonus interest.
• InvestShield Cash is a Market Linked plan that provides
capital guarantee on the invested premiums and declared
bonus interest along with flexible liquidity options.
• InvestShield Gold is a Market Linked plan that provides
capital guarantee on the invested premiums and declared
bonus interest along with limited premium payment
terms.

Protection Solutions
LifeGuard is a protection plan, which offers life cover at very
low cost. It is available in 3 options level term assurance,
level term assurance with return of premium and single
premium.

Child Plans
SmartKid education plans provide guaranteed educational
benefits to a child along with life insurance cover for the
parent who purchases the policy. The policy is designed to
provide money at important milestones in the child’s life.
SmartKid plans are also available in unit-linked form both
single premium and regular premium.

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 32

Retirement Solutions
• ForeverLife is a retirement product targeted at
individuals in their thirties.
• SecurePlus Pension is a flexible pension plan that
allows one to select between 3 levels of cover.
Market-linked retirement products
• LifeTime Pension II is a regular premium market-linked
pension plan
• LifeLink Pension II is a single premium market-linked
pension plan.
• InvestShield Pension is a regular premium pension plan
with a capital guarantee on the investible premium and
declared bonuses.

Flexible Rider Options

ICICI Pru Life offers flexible riders, which can be added to
the basic policy at a marginal cost, depending on the specific
needs of the customer.
• Accident & disability benefit: If death occurs as the
result of an accident during the term of the policy, the
beneficiary receives an additional amount equal to the
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.
• Accident Benefit: This rider option pays the sum assured
under the rider on death due to accident.
• Critical Illness Benefit: protects the insured against
financial loss in the event of 9 specified critical

INDIAN INSTITUTE OF PLANNING AND MANAGEMENT 33

 illnesses. Benefits are payable to the insured for medical
expenses prior to death.
• Major Surgical Assistance Benefit: provides financial
support in the event of medical emergencies, ensuring
benefits are payable to the life assured for medical
expenses incurred for surgical procedures. Cover is
offered against 43 surgical procedures.
• 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
SmarKid, SecurePlus and CashPlus
• 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.

SERVICE STANDARDS

Six sigma

ICICI prudential realized early on that quality could be a

significant differentiar with respect to the competition .Hence
it launched a six sigma initiative as a quality measurement
tool to understand and fulfill customer needs, set industry
benchmarks and make its operations salable with a focus on
customers and costs.

Through Six sigma there has been a continuous focus on the

customer, which fits in ideally with a focus on the customer,
which fits in ideally with ICICI Prudential’s customer centric
approach.

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 ABOUT INCOME TAX

Given below is the proposed Income Tax Ready Reckoner for

income/tax rebates available for the year 2005-06.

TAX RATES
Income Tax Rate Surcharge
Up to Rs100000 Nil Nil
Rs100001 – 10% on income above Rs100000/= Nil
150000
RS150001- Rs5000 + 20% on income above Nil
250000 Rs150000/=
Rs250001- Rs25000 + 30% on income above Nil
1000000 Rs250000/=
Rs1000001 & Rs25000 + 30% on income above 10% on tax
above Rs250000/=

• For women employee tax rates starts only from

Rs.1,25,000 instead of Rs.1,00,000
• Education Cess of 2% chargeable on Income Tax and
Surcharge.

STANDARD DEDUCTION
Effective financial year 2005-06, benefit of standard deduction
on salary income withdrawn.

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DEDUCTION FROM TOTAL INCOME

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Section Description Maximum Rate Proof required
Amount of
Deduc
tion
80C LIC Pension plan or Rs1,00,000 100% Premium Receipt
other equivalent /= -------------
schemes of private -------------
insurance companies, Through Salary
PF, Through Salary
VPF, Deposit Challan/
PPF, Passbook
NSC, Copy of
ULIP, Certificates
CTD Copy of
NSC-interest Certificates
Accrued, Tuition Deposit Challan
fees, Previous year
House loan principal NSC’s
repayment, Deposit Challan
Infrastructure Bonds Interest
certificate
-----------
Copy of Bonds
80D Medical Insurance Rs10,000/= 100% Premium Receipt
Premium
80DD Medical Treatment Rs50,000/= 100% Certificate from
for handicapped a Govt hospital
dependent
80U Permanent physical Rs50,000/= 100% Certificate from
disability a Govt hospital

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80 E Interest on loan taken Rs40000/= Certificate given
for higher education by the lender

HRA REBATE
Least of the following is allowed as a deduction from total
income
• Actual HRA received
• 50% of Basic (40% in case of non-metro city)
• Excess of rent paid over 10% of basic

Proof Required
Copies of monthly rent receipts with the following details
without which HRA rebate will not be allowed
1. Name and address of the landlord
2. Address of the rented residential property
3. Month/ Duration
4. Rent amount
5. Signature of the landlord on revenue stamp

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LOSS on HOUSE PROPERTY to be claimed in Form 12C

Following supports/proofs are mandatory for claiming loss on

house property
• Interest Certificate for the financial Year 2005-2006
• Copy of Possession Letter/ Sale Deed
• Joint Property declaration if loan is in joint names
• In case house is rented/let out, copy of the lease deed is
required
• The property for which the deduction is being
sought must be in the name of the employee. In case of
joint property the first joint owner must be the employee
and an undertaking has to be given by the employee in
Joint Property Declaration attached
• No deduction is available for purchase of plots or for a
property where construction has not yet been
completed/possession not yet taken

IMPORTANT NOTE
• Both HRA rebate and loss on house property can not be
availed if both the properties, rented and the own, are in
the same town
• Loss on house property can not be claimed for a vacant
house located in the same city where the office is located
• Loss on house property can not be claimed without
taking possession of the property.
• Loss on house property can be claimed only for a
residential house property (not a plot)

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TAX REBATE
Effective financial year 2005-06 benefit u/s 88 for tax rebate
and u/s 88C for tax rebate Rs. 5000/- for women employees
have been withdrawn.

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.
PORTFOLIO MANAGEMENT

Portfolio Management is used to select a portfolio of new

product development projects to achieve the following goals:
• Maximize the profitability or value of the portfolio
• Provide balance
• Support the strategy of the enterprise

Portfolio Management is the responsibility of the senior

management team of an organization or business unit. This
team, which might be called the Product Committee, meets
regularly to manage the product pipeline and make decisions
about the product portfolio. Often, this is the same group that
conducts the stage-gate reviews in the organization.

A logical starting point is to create a product strategy -

markets, customers, products, strategy approach, competitive
emphasis, etc. The second step is to understand the budget or
resources available to balance the portfolio against. Third,
each project must be assessed for profitability (rewards),
investment requirements (resources), risks, and other
appropriate factors.

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 NATURE OF JOB AS A TRAINEE

At priority circle, nature of the job included recruitment of the

channel members who were further assigned to solicitate
insurance. The database was provided to us which had the
names of the selected people across Delhi. They were invited
to office for the first meet with the manager- priority clients.
The MPC job is to explain the course of action followed to
join the business.

After the first meet if the prospect is satisfied he is given a

document called ‘market 100’ to explore his contacts which
would help him grow his business. The prospect fills the
document and brings it to the office. The MPC scrutinizes the
document. The next step is to meet the territory manager who
would judge the prospect whether he is capable to do the job
or not. If the territory manager is satisfied, then the person
fills other formalities like form, age proof and other
documents and is ready to receive the training.

The training is conducted by the lead trainer of the branch for

about 9 days, following which an exam is held. After clearing
the exam the IRDA license is given, post which the advisor is
ready to sell insurance and do financial consulting for his
clients.

I also got the questionnaire filled up by the staff of some

reputed firms like American Express, Glaxo Smithkline, and
Virgin Atlantic.

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The job was to study their profile and investment plans
through this questionnaire and manage their portfolios.

I designed the chart of their investments and had a detailed

brain storming on their portfolios so that I could give them the
best product in terms of saving tax and good returns.

I took over individual clients from the database and sent them
courier consisting of their present investment pattern and the
imaginary pattern which I made for him which could be very
beneficial for them, all the brochure related to the product
which I advised him, and a letter explaining him what he is
doing right know and what he should.

I gave them consultation on the insurance products which

included switching over from one product to other beneficial
product or switching from one fund to other.

I also gave them consultation that they should switch over

from the policies of certain companies to ICICI Prudential as
it would very beneficial because ICICI Prudential has very
flexible products. I myself appreciated there product named as
LIFETIME which had a lock in period of 3 years and after that
you can withdraw all your without interrupting your sum
assured.

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 LIMITATIONS OF THE STUDY

While working on the project the following limitations and constraints

were there:

1. The awareness and understanding capabilities of the buyers of the

corporate clients.

2. Lack of time and resources as compared to research organizations

that take up such studies.

3. I was able to cover only few products of ICICI prudential due to

time constraint.

4. The area being covered for the project was also limited only Delhi
and gurgaon where as the products being used throughout the
country.

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 BIBLIOGRAPHY

1. Iciciprulife.com
2. Lic.com
3. Google.co.in
4. Indiainfoline.com
5. ICICI Prudential Product Brochures.
6. ICICI Prudential Presentations.

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 ANNEXURES

1. Portfolio management questionnaire.

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  The following questionnaire was filled up by the
client’s form, which I got the information about
their investment.

How long have you been working with the specified company?

What’s your Date of Birth?

Are you Married:

If yes where is your spouse working

Please help me in finding the right category:
Your annual salary
2 – 3 lacs
3 – 4 lacs

4 lacs and above

Where have you invested your money to save tax:
PPF
NSC
BONDS
INSURANCE

MUTUAL FUNDS

Name: _______________________

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