Specialist in Indian Banking and Economic Research

Hemindra Hazari

Is a Securities & Exchange Board of India (SEBI) registered research analyst with over 25 years experience in the Indian capital markets with a specialization in banking and economy research and has managerial experience of establishing profitable equities business, leading and mentoring analysts.  He has worked with prominent foreign and domestic capital market firms such as UBS, Societe Generale, HSBC, ASK Raymond James  and Karvy Stock  Broking and is a regular guest on business media channels and is respected for his non-consensus view on stocks and the market.

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ICICI Prudential Life Insurance (IPRU IN)

<p>Even amongst private sector insurers in India, ICICI Prudential Life (ICICI PruLife) is an outlier in terms of excessive reliance on unit-linked insurance products (ULIPs), a policy similar to a mutual fund rather than pure life insurance. Such policies tend to have a shorter tenor than typical life insurance policies. The company also has higher equity investments as compared to the industry resulting in a volatile investment performance, swinging from significant profits to losses with only a sub 10% fall in the major stock indices to which its equity investments are linked. The company lacks transparency in disclosing the reasons for such volatility. The company’s business-mix appears to be that of a mutual fund whilst incidentally having a life insurance license and therein lies the irony of life insurance privatisation in India. </p>

Even amongst private sector insurers in India, ICICI Prudential Life (ICICI PruLife) is an outlier in terms of excessive reliance on unit-linked insurance products (ULIPs), a policy similar to a mutual fund rather than pure life insurance. Such policies tend to have a shorter tenor than typical life insurance policies. The company also has higher equity investments as compared to the industry resulting in a volatile investment performance, swinging from significant profits to losses with only a sub 10% fall in the major stock indices to which its equity investments are linked. The company lacks transparency in disclosing the reasons for such volatility. The company’s business-mix appears to be that of a mutual fund whilst incidentally having a life insurance license and therein lies the irony of life insurance privatisation in India. 

ICICI Prudential Life: Life Insurer or Mutual Fund?