Insurance Sector In India

ABOUT ICICI BANK

ICICI bank has been present in the financial service sector for the past 50 years. With a network of about 950 branches and 3,300 ATMs in India and a presence in 17 countries, it happens to be the largest bank in the private sector and also the second largest bank in India. Its total assets sums up to Rs.3,767 billion (USD 96 bn.) as on December31,2007 and profit after tax to Rs.31.10 billion for fiscal 2007. It ranks third on the Indian stock exchange, in terms of free float market capitalization. It offers an extensive array of banking products and financial services to corporate and retail customers via a variety of delivery channels and through its dedicated subsidiaries and partners in the fields of investment banking, venture capital, life and non-life insurance, and asset management. The United Kingdom, Russia, Canada, Singapore, Bahrain, Hong Kong, Sri Lanka and Dubai International Finance Centre are presently the bank's subsidiaries. ICICI has its representative offices in the United States, China, South Africa, Bangladesh, Thailand, United Arab Emirates, Malaysia and Indonesia.

PRUDENTIAL PLC

Prudential plc was established in London in 1848. It has its businesses spread across the UK, Europe, US and Asia. It provides retail financial services products and services to more than 20 million customers, policyholder and unit holders and manages over Ј256 billion of funds worldwide (as of June 30, 2007). In Asia, Prudential is the leading European life insurance company with functions in China, Singapore, Hong Kong, India, Japan, the Philippines, Korea, Malaysia, Indonesia, Taiwan, Vietnam, and Thailand. For Asian sourced assets, it is the second largest retail fund manager. Its business of fund management has stretched to about ten markets that includes China, India, Japan, Korea, Singapore, Taiwan, Hong Kong, Vietnam, Malaysia, and United Arab Emirates.

ABOUT ICICI PRUDENTIAL

ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank and Prudential plc. The ICICI Bank holds a stake of 74% and Prudential plc holds 26% with a total capital infusion standing at Rs. 29.32 billion.

On getting approval from Insurance Regulatory Development Authority (IRDA), it started its operations in December 2000. It has over 735 offices, over 243,000 advisors; and 22 bancassurance partners all over the nation.

ICICI Prudential has a National Insurer Financial Strength rating of AAA (Ind) from Fitch ratings. It was the first Indian life insurer to get the AAA rating. ICICI Prudential has been enjoying the status of India's Most Trusted Private Life Insurer as voted by the Economic Times - AC Nielsen ORG Marg survey of 'Most Trusted Brands' for three consecutive years.

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

It offers a wide range of products under three basic plans-

* Life Insurance Plans- It includes Education Insurance Plans, Wealth Creation

Plans, Premium Guarantee plans, Protection Plans.

* Retirement Solutions- It includes ForeverLife, LifeTime Super Pension ,

LifeLink Super Pension.

* Health Product Suite- It includes HealthAssure Plus, Hospital Care, Cancer Care,

Cancer Care Plus, Crisis Cover, Diabetes Care, Diabetes

Care Plus.

ICICI Prudential's success was a result of the amalgamation of ICICI's brand strength, infrastructure, customer base and market innovators and Prudential's reputation, insurance expertise, product and distribution.

UNDERSTANDING INSURANCE

Insurance can be defined as a form of risk management which is mainly used to evade the risk of a contingent loss. It can be called as the fair transfer of the risk of a loss, from one unit to another, in exchange for a premium1.

The potential risks like travel accidents, death, fire mishaps, unemployment , theft, property destruction by natural calamities, etc can be circumvented by using the effective tool of insurance.

The main functions of insurance are as follows:

1. To provide security and protection against future risks, accidents and uncertainty.

2. Insurance is a device by which few losses are shared among larger number of people. All the insurance policy holders add the premiums towards a fund and out of that fund, those exposed to a particular risk are paid.

3. Insurance evaluates the various factors that could give rise to risk and then assesses the probable size of risk. The premium rate is determined by the evaluated risk.

4. The insured can pay small amount of premium against bigger risks and uncertainties.

5. Insurance provides an opportunity for the development of those larger industries which possess more risk in their setting up process.

1. Premium is a specified amount of money that a person has to pay the insurance agencies, every month,

so that they can provide a financial back up in case of a health emergency, loss of asset etc.

6. By way of insurance, individuals are cautioned to take up suitable device to avert regrettable consequences of risk by observing safety instructions; setting up of automatic sprinklers or alarm systems, etc. Prevention of any loss causes lesser payment to the policy holder by the insurer and this will result in more savings through premium. Reduced rate of premiums stimulate for more business and better protection to the insured.

7. Insurance can make the individual avoid unnecessary expenses and hence can act as a as a way of savings. Individuals also invest in insurance in order to avail income-tax exemptions.

8. Insurance can also be a source of earning foreign exchange. For example: issue of marine insurance