INTRODUCTION

Life insurance
Life insurance (Life Assurance in British English) is a type of insurance. As in all insurance,
the insured transfers a risk to the insurer. The insured pays a premium and receives a policy
in exchange. The risk assumed by the insurer is the risk of death of the insured.
How life insurance works
There are three parties in a life insurance transaction; the insurer, the insured, and the owner
of the policy (policyholder), although the owner and the insured are often the same person.
For example, if John Smith buys a policy on his own life, he is both the owner and the
insured. But if Mary Smith, his wife, buys a policy on John's life, she is the owner and he is
the insured. The owner of the policy is called the grantee (he or she will be the person who
will pay for the policy). Another important person involved is the beneficiary. The
beneficiary is the person or persons who will receive the policy proceeds upon the death of
the insured. The beneficiary is not a party to the policy, but is designated by the owner, who
may change the beneficiary unless the policy has an irrevocable beneficiary designation.
With an irrevocable beneficiary, that beneficiary must agree to changes in beneficiary,
policy assignment, or borrowing of cash value.
The policy, like all insurance policies, is a legal contract specifying the terms and conditions
of the risk assumed. Special provisions apply, including a suicide clause wherein the policy
becomes null if the insured commits suicide within a specified time for the policy date
(usually two years). Any misrepresentation by the owner or insured on the application is
also grounds for nullification. Most contracts have a contestability period, also usually a
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two-year period; if the insured dies within this period, the insurer has a legal right to contest
the claim and request additional information before deciding to pay or deny the claim.
The face amount of the policy is normally the amount paid when the policy matures,
although policies can provide for greater or lesser amounts. The policy matures when the
insured dies or reaches a specified age. The most common reason to buy a life insurance
policy is to protect the financial interests of the owner of the policy in the event of the
insured's demise. The insurance proceeds would pay for funeral and other death costs or be
invested to provide income replacing the deceased's wages. Other reasons include estate
planning and retirement. The owner (if not the insured) must have an insurable interest in
the insured, i.e. a legitimate reason for insuring another persons life. The insurer (the life
insurance company) calculates the policy prices with an intent to recover claims to be paid
and administrative costs, and to make a profit. The cost of insurance is determined using
mortality tables calculated by actuaries. Actuaries are professionals who use actuarial
science which is based in mathematics (primarily probability and statistics). Mortality tables
are statistically based tables showing average life expectancies. The three main variables in
a mortality table are age, gender, and use of tobacco. The mortality tables provide a baseline
for the cost of insurance. In practice, these mortality tables are used in conjunction with the
health and family history of the individual applying for a policy in order to determine
premiums and insurability. The current mortality table being used by life insurance
companies in the United States and their regulators was calculated during the 1980s. There
is currently a measure being pushed to update the mortality tables by 2008.
The current mortality table assumes that roughly 2 in 1,000 people aged 25 will die during
the term of coverage. This number rises roughly quadratic ally to about 25 in 1,000 people
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for those aged 65. So in a group of one thousand 25 year old males with a $100,000 policy,
a life insurance company would have to, at the minimum, collect $200 a year from each of
the thousand people to cover the expected claims. The insurance company receives the
premiums from the policy owner and invests them to create a pool of money from which to
pay claims, and finance the insurance company's operations. Contrary to popular belief, the
majority of the money that insurance companies make comes directly from premiums paid,
as money gained through investment of premiums will never, in even the most ideal market
conditions, vest enough money per year to pay out claims. Rates charged for life insurance
increase with the insured's age because, statistically, a people are more likely to die as they
get older.
Since adverse selection can have a negative impact on the financial results of the insurer,
the insurer investigates each proposed insured (unless the policy is below a companyestablished minimum amount) beginning with the application, which becomes part of the
policy. Group Insurance policies are an exception. This investigation and resulting
evaluation of the risk is called underwriting. Health and lifestyle questions are asked, and
the answers are dutifully recorded. Certain responses by the insured will be given further
investigation. Life insurance companies in the United States support The Medical
Information Bureau, which is a clearinghouse of medical information on all persons who
have ever applied for life insurance. As part of the application, the insurer receives
permission to obtain information from the proposed insured's physicians. Life insurance
companies are never required by law to underwrite or to provide coverage on anyone. They
alone determine insurability, and some people, for their own health or lifestyle reasons, are

uninsurable. The policy can be declined (turned down) or rated. Rating means increasing
the premiums to provide for additional risks relative to that particular insured.
Many companies use four general health categories for those evaluated for a life insurance
policy. These categories are Preferred Best, Preferred, Standard, and Tobacco. Preferred
Best means that the proposed insured has no adverse medical history, is not under
medication for any condition, and his family (immediate and extended) have no history of
early cancer, diabetes, or other conditions. Preferred is like Preferred Best, but it allows that
the proposed insured is currently under medication for the condition and may have some
family history. Most people are in the Standard category. Profession, travel, and lifestyle
also factor into not only which category the proposed insured falls, but also whether the
proposed insured will be denied a policy. For example, a person who would otherwise be in
the Preferred Best category will be denied a policy if he or she travels to a high risk country.
Upon the death of the insured, the insurer will require acceptable proof of death before
paying the claim. The normal minimum proof is a death certificate and the insurer's claim
form completed, signed, and often notarized. If the insured's death was suspicious and the
policy amount warrants it, the insurer may investigate the circumstances surrounding the
death, before deciding whether there is a legal obligation to pay the claim. Proceeds from
the policy may be paid in a lump sum or as an annuity paid over time in regular recurring
payments for either for the life of a specified person or a specified time period.

Insurance

Insurance is a contract for reducing losses from accident incurred by an individual party
through a distribution of the risk of such losses among a number of parties. It is a system
under which the insurer, for a consideration usually agreed upon in advance, promises to
reimburse the insured or to render services to the insured in the event that certain accidental
occurrences result in losses during a given period. It thus is a method of coping with risk.
Its primary function is to substitute certainty for uncertainty as regards the economic
cost of 1oss-producing events is concerned. Thus, In return for a specified consideration,
the insurer undertakes to pay the insured or his beneficiary some specified amount in the
event that the insured suffers loss through the occurrence of a contingent event covered by
the insurance contract or policy. By pooling both the

Financial contributions and the "insurable risks" of a large number of policyholders, the
insurer is typically able to absorb losses incurred over any given period much more easily
than would the uninsured individual. Insurance relies heavily on the "1aw of 1arge
numbers." In large homogeneous populations it is possible to estimate the normal
frequency of common events such as deaths and accidents. Losses can be predicted with
reasonable accuracy, and this accuracy increases as the size of the group expands. From a
theoretical standpoint, it is possible to eliminate all pure risk if an infinitely large group is
selected. The risks must be such that pooling is both feasible and advantageous to the two

Parties
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From the standpoint of the insurer, an insurable risk must meet the following requirements:
The objects to be insured must be numerous enough and homogeneous enough
to allow a reasonably close calculation of the probable Frequency and severity of
looses
2. The insured objects must not be subject to simultaneous destruction. For example,
if all the buildings insured by one insurer are in an area subject to flood, and a flood
occurs, the loss to the insurance underwriter may be catastrophic .
3. The possible loss must be accidental in nature, and beyond the control of insured.
If the insured could cause the loss, the element of randomness and predictability
would be destroyed.
4. There must be some way to determine whether a loss has occurred and how great
that loss is. This is why insurance contracts specify very definitely what events must
take place, what constitutes loss, and how it is to be measured.
From the viewpoint of the insured person, an insurable risk is one for which the probability
of loss is not so high as to require excessive premiums. What is "excessive" depends on
individual circumstances, including the insured's attitude toward risk. At the same time, the
potential loss must be severe enough to cause financial hardship if it is not insured against.
Insurable risks include: Losses to property resulting from fire, explosion, windstorm, etc;
Losses of life or health; and the legal liability arising out of use of automobiles, Occupancy
of buildings, employment, or manufacture.

Uninsurable risks include:

Losses resulting from price changes and competitive conditions in the market.
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Political risks such as war or currency debasement are usually not insurable by
private parties but may be insurable by governmental institutions.
Very often contracts can be drawn in such a way that an "uninsurable risk" can be turned
into an "insurable" one through restrictions on losses, redefinitions of perils, or other
methods.

INSURANCE IN INDIA
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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 year 1818
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 business.

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 consolidated and amended to by the Insurance Act with the
objective of protecting the interests of the insuring public.
1956: 245 Indian and foreign insurers and provident societies taken over by the central
government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act,
1956, with a capital contribution of Rs. 5 crore 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 insurance business.
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 (Nationalization) Act, 1972 nationalized the general
insurance business in India with effect from 1st January 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
reform 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 reformsIn 1994,
the committee submitted the report and some of the key recommendations included:

Structure
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 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 a 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 independent

Investments
Mandatory Investments of LIC Life Fund in government securities to be
reduced From 75% to 50%

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 GIC and its subsidiaries are not to hold more than 5% in any company
(There Current 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
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2000 has fastidiously stuck to its schedule of framing regulations and registering the private
sector insurance companies.

The other decisions taken simultaneously to provide the supporting systems to the Insurance
sector and in particular the life insurance companies were the launch of the IrDAs 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, which are expected to be introduced by early next year.
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.
There are 12 private life insurance companies and 1 public life insurance company. These
are:
Allianz Bajaj
ICICI- Prudential
Max- New York Life
HDFC- Standard Life Insurance
ING- Vysya
TATA- AIG Life
Birla- Sun life
Om Kotak Life
Aviva

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 Met Life
AMP Sammar
SBI Life

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Public Life Insurance Company is:

LIC
The Insurance Regulatory and Development Authority Act, 1999
To permit the private companies to enter the insurance market, the Government enacted the
Insurance Regulatory and Development Authority Act 1999, which was passed by the
parliament in December 1999. It received Presidential assent in January 2000.
The authority is a ten member team consisting of
a) A Chairman;
b) Five whole-time members;
c) Four part-time members.

FINANCIAL RELATIONS
It is mandatory for each and every company to have paid up capital of Rs 100 crore
prior to grant of license.
85% of premium collected by any insurer has to be invested in the government
approved i.e. Central government, state government and other approved
infrastructure bonds and securities
Although all private insurance companies can have a foreign partner to the extent of
26% in their equity, not a single rupee can be invested out of India i.e. in foreign
investment. Now the foreign partner can have joint venture ship with 45%of equity.
An amount equal to 95% of profits generated every year has to be compulsorily
distributed among policyholders as bonus.

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 A check n management expenses has been sought with a restriction that it cannot be
more than 15% of the total earnings of the insurance company in a year.

OBJECTIVE OF THE STUDY

To determine and analyzed the Market Potential of the Birla Sun Life Insurance
Company in Moradabad.
To ascertain the impact of promotional activity on purchase decision.
To study the overall scenario currently prevailing in the market, namely, the per capital
income, purchasing power, occupation, literacy rate, etc.

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SCOPE & IMPORTANCE

To find out the measures to boost up sales.

To study and determine the competitor position in the market.
To beneficial for customers according his capacity.
To security of future life.
To conduct promotional activity in various places like shopping malls, residential
areas, corporate etc.

To do a performance evaluation of Birla Sun Life Insurance products in comparison on with

other insurance companies

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COMPANY PROFILE
INTRODUCTION OF ADITYA BIRLA GROUPThe Aditya Birla Group is Indias first truly multinational corporation, Global in vision,
rooted in values, the group is driven by performance ethic pegged on value creation for its
multiple stakeholders. A US$ 24 billion conglomerate, with a market capitalization of US$
24 billion and in the league of Fortune 500, it is anchored by an extraordinary belonging to
over 25 different nationalities. Over 50 percent of its revenues flow from its operations
across the world.
The Groups products and services offer distinctive solutions worldwide .Its 85 state-of-theart manufacturing units and sectoral services span 20 countries India, Thailand, Laos,
Indonesia, Philippines, Egypt, Canada, Australia, China, USA, UK, Germany, Hungary,
brajil, Italy, France, Luxembourg, Switzerland, Malaysia and Korea.
The group has been adjudged the best employer in India and among the top 20 in Asia by
the Hewitt-Economic Times and Wall street journal Study 2007

In India the group holds a frontrunner position as

Indias leading copper producer
A premier branded garments player
The second largest player in viscose filament yarm.
The second largest player in the chlor alkali sector.
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 Among the top five mobile technology players

A leading player in Life insurance and asset management.

SUN LIFE FINANCIAL

Sun Life Financial is a leading international financial services organization providing a
diverse range of protection and wealth accumulation products and services to individuals
and corporate customers. Chartered in 1865, Sun Life Financial and its partners today have
operations in key markets worldwide, including Canada, the United States, the United
Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, China and
Bermuda. As of March 31, 2007, the Sun Life Financial group of companies had total assets
under management of CDN$446 billion

BIRLA SUN LIFE PROMOTED COMPANIES

1. BIRLA SUN LIFE ASSET MANGEMENT COMPANY LTD
A collaboration of the US $ 8.3 billion Aditya birla group and the CDN $ 400 billion Sun
life financial of Canada brings together global and Indian expertise to the area of financial
services.
Birla Sun Life Asset Management Company Ltd., the investment managers of Birla
Mutual fund, is a joint venture between the Aditya Birla Group and the Sun Life Financial
Services Inc. of India. The joint venture brings together the Aditya Birla Groups experience
in the Indian market and Sun Lifes global experience.
Since its inception in 1994, Birla Mutual fund has emerged as one of Indias Leading
Mutual Funds managing assets of a large investors base. The fund offers a range of
investment options, which include diversified and sector specific equity schemes, fund of
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fund schemes, hybrid and monthly income funds, a wide range of debt and treasury
products and offshore funds.

2. BIRLA SUN LIFE INSURANCE

Birla Sun Life Insurance pioneered the unique Unit Linked Insurance Solutions in
India.
Within 4 years of its launch, BSLI has cemented its position as a leading player in
the private life insurance industry.
There has been focus on Investment Linked Insurance Products to maintain
leadership in product innovation.
Multi distribution Channels- Direct Sales force, Alternative Channels and Group
offering convenient channels of purchase to customers
Web enabled IT system for superior customer services.
First to have issued policies over the internet.
Corporate governance and a high degree of transparency in all business practices
and procedures.
First to have an operational business continuity plan.
Strong fundamentals based on the Aditya Birla Groups local insight and Sun Life
Financials global expertise

VISIONTo be a world class provider of financial security to individuals and corporate and to be
amongst the top three private sectors life insurance companies in India.

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MISSIONTo be the first preference of our customers by providing innovative, need based life
insurance and retirement solutions to individuals as well as corporate. These solutions will
be made available by well trained professionals through a multi channel distribution
network and superior technology.
It will provide constant value addition to customers throughout their relationship with
us, within the regulatory framework.

Values Integrity
Commitment
Passion
Seamlessness
Speed

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PRODUCT PROFILE
Individual Life
Protection
Saving
Birla Sun Life Insurance Gold-Plus
Supreme Life
Dream Plan
Classic Life Premier
Simply Life
Prime Life Premier
Prime Life
Life Companion
Flexi Cash Flow
Flexi Save Plus
Flexi Life Line
Single Premium Bond

Birla Sun Life Term Plan

Premium Back Term Plan
Retirement

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Flexi Secure Life Retirement Plan II

Children

Children's Dream Plan

Rural

Bima Kavach Yojana

Riders
Accidental Death and Dismemberment Rider
Term Rider
Critical Illness Rider
Waiver of Premium
Critical Illness Plus Rider
Critical Illness - Woman Rider

Retirement
Our Retirement Plans allow I to meet Ir expenses and build a nest egg, which gives I
the freedom to live life to the fullest even after retirement.

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The post retirement years can be the best years of Ir life. Time to do things I couldn't have
done while I were working. A right financial planning makes Ir post retirement years truly
golden . Our Sun Life secure Life II assures I just that.

PRODUCTS
Insurance Plans
Life is unpredictable. But in face of adversity, our responsibilities
towards our parents, children and loved ones need not be compromised.
Insurance planning equips I to smooth out the uncertainties and adversities
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that life might send Ir way, so that the best that life has to offer, secure in
the knowledge that Ir beloved ones are well provided for.
BSLI offers a complete range of insurance products
1. Protection Plans
2. Savings Plans
3. Child Plans
4. Investment Plans
5. Retirement Plans
6. Group Plans
7. Rural Plans
8. Plans for NRIs
9. Keyman Plans
10. Riders

PROTECTION PLANS
Life Gurad

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BSLI offers LifeGuard - a set of pure protection plans. Choose from

amongst three different product structures to insure Ir life and provide total
security to Ir family, at a very affordable cost.
Level Term Assurance with return of premium
On death the entire sum assured will be paid.

On maturity, all the premiums paid will be returned.

Level Term Assurance without return of premium

On death the entire sum assured will be paid.

No survival or maturity benefits.

I can also enhance the above two policies by adding Accident & Disability
Benefit Rider and Waiver of Premium Rider (WOP) .
Level Term Assurance - Single premium:

On death the entire sum assured will be paid.

No survival or maturity benefits

Savings Plans

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BSLI offers a variety of policies that give the benefits of protection and the
opportunity to save for important assets or events, like a home, a car or a
wedding.
Invest Shield Cash
A regular premium unit-linked insurance plan with an assurance of Capital
Guarantee# with the added advantage of flexible liquidity option. An ideal
plan for long term planning with the benefit of liquidity.
The key features of the plan are:
Flexibility to choose a specific level of protection (Sum Assured),
based on a multiple of the annual premium. I can also choose the term
of the plan.
At the end of the term, the higher of the value of units or the
guaranteed value* is paid. On death, Sum Assured along with the
higher of value of units or the guaranteed value is payable.
Facility to make withdrawals from the 6th policy year

onwards till

the end of the policy term. Every year withdraw up to 10% of the
value of units.
Additional credits payable as a percentage of the initial annual
premium are paid along with the death or maturity benefit.
Additional insurance for 10 years after the maturity, for an amount of
50% of the Sum Assured.

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 Flexibility to make additional investment with the help of the top-up

facility.
Flexibility to increase / decrease annual premium amount
Facility of Automatic Premium Payment- With this facility I can take
a temporary break from premium payment.
Total transparency with the premium allocations, and other charges
declared upfront.
The guaranteed value of the unit fund is the value of all invested
premiums (premiums net of all charges) along with the declared bonus
interests.
** With Automatic Premium Payment facility, I can avail a temporary
break from premium payment for a maximum of 1 year. This facility is
available once if the premium paying term is less than 15 years and
twice, if it is 15 years or more.
I can also enhance policy by adding Accident & Disability Benefit Rider ,
Waiver of Premium Rider and Critical Illness Rider .
Invest Shield Life
A regular premium unit-linked insurance plan with an assurance of Capital
Guarantee# An ideal plan for long-term savings and protection requirement.
The key features of the plan are :

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Flexibility to choose a specific level of protection ( Sum Assured),

based on a multiple of the annual premium. I can also choose the term of
the plan.

At the end of the term, the higher of the value of units or the
guaranteed value* is paid. On death, Sum Assured along with the higher
of value of units or the guaranteed value is payable

Additional credits payable as a percentage of the initial annual

premium are paid along with the death or maturity benefit.

Additional insurance for 10 years after the maturity, for an amount

of 50% of the Sum Assured.

Flexibility to make additional investment with the help of the topup facility.

Flexibility to increase / decrease annual premium amount

Facility of Automatic Premium Payment- With this facility I can

take a temporary break from premium payment.

Total transparency with the premium allocations, and other charges

declared upfront.
The guaranteed value of the unit fund is the value of all invested
premiums (premiums net of all charges) along with the declared bonus
interests.
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With Automatic Premium Payment facility, I can avail a temporary break

from premium payment for a maximum of 1 year. This facility is
available once if the premium paying term is less than 15 years and
twice, if it is 15 years or more.
The capital guarantee is applicable only on the invested premium and the
declared bonus interests.
I can also enhance Ir policy by adding Accident & Disability Benefit Rider,
Waiver of Premium Rider and Critical Illness Rider.
Invest Shield Gold
A unit-linked insurance plan with an assurance of Capital Guarantee which
offers I the benefit of a limited premium payment term. An ideal plan for
protection with wealth creation that offers the flexibility of a limited
premium paying term.
Flexibility to choose a premium payment term of 5, 7 or 10 years for a
maturity term of 10, 15 or 20 years respectively.
Flexibility to choose a specific level of protection (Sum Assured), based
on a multiple of the annual premium.
At the end of the term (maturity), the higher of the value of units or the
guaranteed value* is paid. On death, Sum Assured along with the higher
of value of units or the guaranteed value is payable.

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 Additional credits payable as a percentage of the initial annual premium

are paid along with the death or maturity benefit.

Facility to make withdrawals from the 6th policy year onwards till the
end of the policy term. Every year withdraw up to 10% of the value of
units
Flexibility to make additional investment with the help of the top-up
facility.
Flexibility to increase / decrease annual premium amount
Total transparency with the premium allocations, and other charges
declared upfront.
The guaranteed value of the unit fund is the value of all invested
premiums (premiums net of all charges) along with the declared bonus
interests.
The capital guarantee is applicable only on the invested premium and the
declared bonus interests.
I can also enhance policy by adding Accident & Disability Benefit Rider and
Critical Illness Rider.
Premier Life
Presenting Premier Life The Preferred plan for the Preferred Customer.
The key features of the plan are:

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 Limited premium payment option: Choose from among a 3, 5, 7 or 10

year premium paying term.
Choice of sum assured: Choose a sum assured, which is a minimum
multiple of 1 and a maximum multiple of 25 times the annual
contribution.
Additional allocation of units on a periodic basis.
Facility to top-up investment any time I have surplus funds.
Choose from among four funds, based on investment objective and risk
appetite.
Choice to switch between investments options (4 free switches every
policy year).
Flexibility to decrease sum assured.
Add-on riders to protect I against any eventuality.
Loans against the policy.

I can also enhance policy by adding Critical Illness Rider, Accident &
Disability Benefit Rider.
Life Time
Presenting Life Time unit linked plans that meets changing needs over a lifetime. These
solutions have been developed to meet savings, protection and investment needs at every
stage in life.

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Protection

Choose a specified level of protection (available only with Lifetime).

Two levels of Sum Assured to choose from (available only with

Lifetime II).

Flexibility to increase or decrease sum assured .

Add-on riders to protect I against any eventuality.

Savings

Flexibility to increase or decrease

contribution.

Facility of Premium Holiday, wherein the policy continues even if

there is a temporary break in the payment of annual contribution
(available only with Life Time).

Facility

of

Automatic

Cover

Continuance,

wherein

the

policy

continues even if there is a temporary break in the payment of annual

contribution

Facility to top-up

investment any time I have surplus funds.

Additional allocation of units on a periodic basis.

Loans against the policy.

Investment:

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 Choose from among four funds, based on

investment objective and risk

appetite.
Choice to switch between investments options (4 free switches every
policy year).
I can also enhance

policy by adding Critical Illness Rider, Major Surgical

Assistance Rider, Accident & Disability Benefit Rider, Accident Benefit

Rider (available only with Life Time) and Waiver of Premium Rider
Secure Plus
An insurance plan that gives added protection, savings and multiple options,
all in one!
The flexibility to choose

premium contribution.

The flexibility to choose amongst three levels of cover (in the form of
sum assured) for the same amount of total annual contribution.
The flexibility of shifting between the three levels of cover, as I require.
The flexibility of receiving

maturity proceeds as a lump sum or in equal

annual installments over 3 or 5 years.

I can also enhance

policy by adding Variety of Riders

Cash Plus
An insurance plan that gives I added protection, savings, multiple options,
plus the power of liquidity.
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 The flexibility to choose premium contribution.

The flexibility to choose amongst three levels of cover (in the form of
sum assured) for the same amount of total annual contribution.
The flexibility of shifting between the three levels of cover, as I require.
The flexibility of receiving maturity proceeds as a lump sum or in equal
annual installments over 3 or 5 years.
The flexibility of withdrawing up to 10% of the accumulated value of
policy, after the first 5 policy years.
I can also enhance policy by adding Variety of Riders
Save n Protect
An ideal plan for those who want to accumulate funds on a regular basis
while enjoying insurance protection.
Guaranteed Benefits: Guaranteed additions @ 3.5% of the Sum Assured,
compounded annually for the first 4 years of the policy.
Extended Life Cover: An extended cover for 5 years after the maturity
of the policy, for 50% of the sum assured, at no extra cost.
Maturity Benefit: At the end of the term, the policyholder receives the
full sum assured, the guaranteed additions and the vested bonuses.
Death Benefit: The beneficiary receives the sum assured, the guaranteed
additions and the vested bonuses incase the life assured were to meet
with an unfortunate event. In case the life assured is aged 7 years or less,
the basic premium paid will be returned.
34

I can also enhance policy by adding Critical Illness Rider , Major Surgical
Assistance Rider , Accident & Disability Benefit Rider , Waiver of Premium
Rider (WOP)

CHILD PLANS

As a responsible parent, I will always strive to ensure a hassle-free,

successful life for Ir child. However, life is full of Uncertainties and even
the best-laid plans can go wrong. Heres how I can give Ir child a 100% safe
and assured tomorrow, whatever the uncertainties. Smart Kid is especially
designed to provide flexibility and safeguard Ir childs future education and
lifestyle, taking all possibilities into account. Choose from amongst a basket
of 4 plans:

Smart Kid regular premium

Smart Kid unit-linked regular premium

Smart Kid unit-linked regular premium II

Smart Kid unit-linked single premium II

35

All these plans offer I:

Financial Benefits: Regular payments at critical stages in childs life,
like Board examinations, Graduation and Post-graduation.
Total peace of mind, even if I are not around
Sum Assured is paid immediately: Ensures that loved ones stay
financially secure, even in absence.
All future premiums are w aived: Ensuring that family is not
financially burdened in absence.
Policy benefits continue: The educational benefits of the policy
continue, ensuring that child can realize his or her dreams without any
hassles.
Development Allowance: Smart Kid guarantees regular income to
secure childs educational career and also ensures his or her all-round
development, for a nominal additional amount. The Income Benefit
Rider takes care of this through an annual payment of 10% of the sum
assured, to child, till the maturity of the policy, in the unfortunate
event of the death of the parent.
All SmartKid plans can be enhanced with the Accident & Disability
Benefit Rider and Income Benefit Rider . I can also an Accident Benefit
Rider to a SmartKid Regular Premium policy, and a Waiver of Premium
Rider (WOP) to SmartKid unit-linked regular premium policy.

36

Investment Plans
Life Link II is a unique plan that combines the
security of a life insurance policy with the
opportunity
investments,

of

enjoying

without

high

the

returns

market

on
risks

compromising on the protection of family!

Death Benefit: The Sum Assured under the product has 2 options, either
500% of the initial premium or 105% of the initial premium. In the event of
an unfortunate death, the beneficiary will receive higher of the value of
units or the initial death benefit, less any withdrawals.
Withdraw al

Benefit:

One

can

make

partial

withdrawals

from

the

accumulated value of the policy after completion of one policy year.

Flexibility: Choose from four fund options, based on investment objective
and risk appetite. If at a later stage financial priorities change, I can switch
between the various fund options, absolutely free, 4 times a year.

37

RETIREMENT PLANS

Life Expectancy has been rising rapidly and today I

can expect to live longer than earlier generations. For I, this increase will
mean a longer retirement life, stretching into a couple of decades.

BSLI

Retirement Solutions that combine the best of insurance and investment.

These solutions are developed to ensure peace of mind for the years to
come.
1.

Why plan for retirement?

2.

How much should I set aside for retirement?

3.

The impact of inflation on retirement savings

4.

Why plan early?

5.

About Annuities

Why plan for retirement?

For too many people, the joy of retirement after years of hard work is
eclipsed by the financial uncertainties that it brings. Despite all the
planning and saving, I can never sure whether money will last a lifetime.
Retirement planning offers a way to ensure a more enjoyable, stress free
tomorrow. A prudent plan will ensure that increasing life expectancy, higher
inflation and increasing taxes do not eat away into hard earned savings.

38

How much must one set aside for retirement?

To ensure a comfortable retired life, one would be wise to invest
money into additional avenues like pension plans. How much I need to
invest can be answered by answering some questions such as:
1. How long do I have to save that amount before retirement?
2. Where can I invest retirement money?
3. How much risk are I willing to take on investments?

Group Solutions
In an era of competitive parity, the only asset that makes a decisive
difference between corporate success and failure is the quality of human
capital. Employee benefits have proven to be an excellent tool to optimize
the retention of talent and improve an organizations bottom-line. The
quality of an organizations employee benefits establishes and maintains a
company's image as a caring employer. Optimum care of employees is a
long-term investment that results in a sustained competitive advantage for
an organization in the times to come.
BSLI Group Solutions Advantage:
An integrated basket of employee benefits solutions that offer
incomparable flexible benefits.

39

 Sound investment management that focuses on safety, stability and

profitability of the portfolio.
Personalized financial planning for Ir employee that takes care of
his/her changing financial needs at every stage of life.
Quality service initiatives and transparency across all operations,
promising superlative operational efficiency.
Group Term Assurance : Helps provide affordable cover to members of a
group.
Group Gratuity Plan : Helps employers fund their statutory gratuity
obligation in a flexible and hassle-free manner.
Group Superannuation Plan : A flexible scheme (defined benefit and
defined contribution) to provide a retirement kitty for each member of the
group.
Group Term Assurance:
BSLI flexible group term solution helps provide affordable cover to
members

of

group.

The

cover

could

be

uniform

or

based

on

designation/rank or a multiple of salary, and can be extended to all

employees between the ages of 18 and 65 years. The benefit under the
policy is paid on the event of the members death to the beneficiary
nominated by the member. It is a one-year renewable policy where one
master policy covers all proposed employees comprising the group, with a

40

minimum group size of 25 persons. New members can join the group and
outgoing members can leave the group at any point during the policy term.
Highlights include:
Greater convenience for the employees with relaxed underwriting
and medical requirements.
"Free Cover Limits" with simplified underwriting depending upon
the number of employees in the group and the level of cover chosen.
Guaranteed benefit: On death during the term of the contract (while
in service), the sum assured will be paid to the beneficiary of the
employee.
Choice of additional coverage in form an Accident and Disability
Benefit Rider and Critical Illness Cover
Premium is viewed as a business expense in the year of payment.

Group Gratuity Plan:

BSLI group gratuity plan helps employers fund their gratuity obligation in
a scientific manner. Employers can avail of the tax benefits as applicable to
approved gratuity funds. The plan can also be customized to structure
schemes that can provide benefits beyond the statutory obligations.
Highlights include:
Wider choice of investments with Market Linked Plans - to meet
the diverse financial goals. We offer 4 investment options (short-term
41

debt, debt and balanced and capital guarantee plan) where investments
will be made in accordance with the fund objectives.
Transparency through Daily disclosure of Unit Value and regular
disclosure of the portfolio of each of the investment option
Flexibility through switching and contribution redirection option to
enable reshuffling of portfolio
Bundled Life Cover greater value to the employee by packaging life
insurance

covers

with

the

gratuity,

with

minimal

amount

of

underwriting.
Actuarial services to provide a scientific estimation of the gratuity
liability.
Low explicit charge structure with the conditions for exit specified
upfront.
Enhanced service levels through faster claim settlement, easier
access to information and regular statements.
Complete end to end solution in the legal and regulatory approval
process for scheme set up or transfer
Employee Benefits:
The contribution made by the employer is not included in the value of
taxable perquisites in the hands of the employee.
Gratuity received up to Rs 350000 is exempt from Income tax under
Sec 10(10)

42

Employer Benefits:
Annual contribution up to 8.33% of salary bill in a financial year is
allowed a deduction for the purpose of computation of profits and
gains of business.
Contribution towards past service liability is allowed as deduction as
per the Income Tax rules.
Group Superannuation Plan:
BSLI Superannuation Scheme (for both Defined Benefit and Defined
Contribution funds) offers substantial benefits to both employers and
employees. The employer and employee can avail of tax benefits applicable
to an approved superannuation trust. The scheme will provide for a
retirement fund for each participating employee. An employee would be able
to choose from various annuity options or opt for partial commutation of
corpus at retirement.
Highlights include:
Wider choice of investments with Market Linked Plans - to meet the
diverse financial goals. We offer 5 investment options (short-term debt,

43

debt, balanced, grow th and capital guarantee plan) where investments

will be made in accordance with the fund objectives.
Control - Each member/employer can exercise greater control over
investments by choosing one or more of the investment options.
Multiple Annuity Options - 5 annuity options and open market option
Transparency - Transparency through Daily disclosure of Unit Value and
regular disclosure of the portfolio of each of the investment option
Flexibility - Flexibility through switching and contribution redirection
option to enable reshuffling of portfolio
Low explicit charge structure with conditions for exit specified
upfront.
Enhanced service levels through faster claim settlement, easier access to
information and regular statements.
Complete end to end solution in the legal and regulatory approval
process for scheme set up or transfer

44

RURAL PLANS
BSLI Rural Products are designed to meet the needs of the rural consumers.
These products offer the following features:
1. Low and Affordable Premiums
2. Life Cover
3. Savings Option
4. Hassle free procedure
BSLI offers 2 specially designed rural plans.
a)

BSLI Endowment Plan

b)

BSLI - Regular Premium

BSLI Endowment Plan:

BSLI offers the following features:
Life Cover and Savings
Regular Premiums
Age at entry
Premium Mode
Term
Sum Assured

18 - 45 Yrs
Half Yearly / Yearly
5,10,15 Yrs
Rs.5,000 -20,000

45

 Premium / Year

Rs. 507 - 553 ( SA: Rs.10,000)

Maturity/Death benefit

Sum Assured

BSLI - Regular Premium:

BSLI is a regular premium policy with the following features:

Individual policy

Only Life cover

Term - 3 & 5 Yrs

Age independent premium

Age at entry

18 - 45 Yrs

Sum Assured

Single

Premium / Year

Rs 50 200

Maturity/Death benefit

Death Benefit

Rs.5,000 - 20,000
Sum Assured

Plans for NRIs

NRI Plans:
Being away from India doesn't mean I have to compromise the safety and
security of loved ones. In fact, savings from time overseas can be easily
canalized to meet family's needs - now and in the future. So, whether its
dream to retire in hometown; to secure funds for children's education; or to

46

build assets, BSLI has a range of solutions that can be customized to meet
needs.

BIRLA SUN LIFE INSURANCE GOLD PLUS

Don't we always wish for that something more? A bigger house, a plush set of wheels,
holidays in exotic lands. Here's something that makes sure I get all that and much more.
Presenting the Birla Sun Life Insurance Gold-Plus Plan - a plan unlike any other. It covers
life while giving I an opportunity to grow investments for the medium term.
DETAILS
An opportunity to grow investments for medium term.
Policy terms 8 years.
Paying period 3 years
The policyholder has an option to reduce the annualized policy premium in the 2nd
and 3rd year subject to a minimum annualized premium of Rs.10,000 per year.
Top Up premium Minimum Rs. 5000
Liquidity through withdrawals and surrender
Withdrawals after 3 policy years, Min Rs. 5000,two partial withdrawals are free in
a year.
Surrender can be surrendered anytime during the policy term but will be paid after
three policy years (if surrendered in first 3 policy yrs). Surrender charge is zero
after 3rd yr.

47

 Entry age 18 to 70 yrs

Minimum Premium: Rs10, 000
Minimum sum assured: 5 x Annual premium.
Maximum sum assured (multiple of annual premium)

Age
18-29
Gold plus
multiple
44

30-34

35-39

40-44

45-49

50-54

55-59

60-70

38

30

21

14

10

NAME OF THE PLAYER MARKET SHARE (%)

LIC
ICICI PRUDENTIAL
BIRLA SUN LIFE
BAJA ALLIANZ
SBI LIFE
HDFC STANDARD
TATA AIG
MAX NEW YORK
AVIVA
OM KOTAK MAHINDRA
ING VYASA
AMP SANMAR
METLIFE

82.3
5.63
2.56
2.03
1.80
1.36
1.29
0.90
0.79
0.51
.37
0.26
0.21

Unit Link Bonds

A unit linked bond is a lump sum investment plan that gives I access to various investment
markets throughout the world, via a wide range of professionally managed funds. These
funds have varying objectives and levels of risk.

48

The underlying make up of the unit linked bond depends on its investment objectives. This
determines the type of stocks and shares in which it invests. Each Investment Linked Bond
offers the option to invest for growth, income or both, I can select the option which best
matches own needs.
5 STEPS TO SELECTING THE RIGHT ULIP
Unit Linked Insurance Plans (ULIPs) were always seen as a 'wonder product' that
simultaneously fulfilled an individual's needs for investment and insurance.
However, the recent downswings in the markets have forced investors to do a rethink. Very
often it was poor selection that was responsible for the investors' woes. Here is a 5-step
strategy for investing in ULIPs.
1.

Understand the concept of ULIPs

Try to do as much homework as possible before investing in an ULIP. This way I
will know what I are getting into and won't be faced with unpleasant surprises at a
later stage.

Experience suggests that many a time people do not realize what they are getting into (in
fact we have been approached by several people who wanted to cancel the ULIPs they had
been coerced into taking by unscrupulous agents). Gather information on ULIPs, the
various options available and understand their working.
Read the literature available on ULIPs on the Web sites and brochures circulated by
insurance companies.
2.

Focus on requirement and risk profile

49

Identify a plan that is best suited for I (in terms of allocation of money

between

equity

and debt instruments). risk appetite should play an important role in the plan I choose.
So if I have a high-risk appetite, go in for a more aggressive investment option and vice-aversa. Opting for a plan that is lop-sided in favor of equities when I are a risk-averse
individual might spell disaster for I (this is true in most cases currently).
3.

Compare ULIPs of different insurance companies

Compare products of the leading insurance companies. Enquire about the premium

payments as ULIPs work on minimum premium basis as opposed to sum assured in the case
of conventional insurance policies.
Check the fund's performance over the past six months. Find out how the debt and equity
schemes are Performing and how steady the performance has been. Enquire about the
charges I will have to pay. In ULIPs the costs involved are a big deciding factor.
Ask about the top-up facility offered by ULIPs i.e. additional lump sum investments I can
make to increase the savings portion of policy.
The companies give I the option to increase the premium amounts, thereby providing I with
the opportunity to gainfully utilize surplus funds at disposal.
Enquire about the number of times I can make free switches (i.e. change the asset allocation
of the money in Ir ULIP account) from one investment plan to another.
Some insurance companies offer I free switch for a 2-year period while others do so only
for 1 year.
50

4.Go for an experienced insurance advisor

Select an advisor who is not only professional and informed, but also independent and
unbiased. Also enquire whether he has serviced clients like I.
When Ir agent recommends a ULIP of X company ask him a few product-related questions
to test him and also ask him why the other products should not be considered.
Insurance advice at all times must be unbiased and independent and agent must be willing
to inform I about the pros and cons of buying a particular plan.
His job should not just begin by filling the form and end after he deposits the cheque and
gives I the receipt. He should keep a track of plan and inform I on a regular basis. The key
is to go for an advisor who will offer I value-added products.
5. Does ULIP offer a minimum guarantee?
In market linked product if investment's downside can be protected, it
a huge advantage. Find out if the ULIP I are considering

would be

offers a minimum guarantee

and what costs have to be borne for the same. This will enable I to make an informed
choice.

51

Will unit linked risk products continue to rule?

Unit linked risk plans are doing roaring business agreed but if the recent reports are any
indication a shake up is on the cards. The mutual fund industry is all set to get aggressive to
counter competition from the insurance industrys unit linked risk products. For mutual
funds the unit linked insurance products launched by life insurance companies are an
encroachment on their territory. Consider this: Around 80 per cent of the premium income
of life insurers has come in through unit-linked plans in 2004 thanks to the boom in the
equity markets.
Which means mutual fund companies are losing out on a huge market that would have
otherwise been theirs? To put an end to such a situation they are toying with the idea of
aggressively publicizing its products through celebrity endorsements which mutual funds
feel will give a never-before fillip to its unit linked schemes.
Unit linked insurance products launched have been doing brisk business and insurers have
been coming out with several such products with slight variations to suit the changing needs
of the customers. These products are investment avenues that provide market related returns
to the investor with an element of insurance thrown in. For the customer the attraction of
market related returns with insurance is an attractive option. On the contrary though mutual
fund companies also have unit-linked products what is absent is the insurance cover.
But the grouse of mutual funds is that they have to adhere to stringent regulations that are
absent for insurance companies when the products are almost similar. While for insurance
companies it is not mandatory to disclose the various expenses related to unit linked risk
products such as expense ratio and brokerages among others, for mutual fund companies it
is mandatory.
52

At a glance the pros and cons:

Pros

Cons
The value of the bond can go down

I'll

usually

have

to

invest

as well as up

minimum amount of premium p.a.

I can invest in a number of different

that

funds within the bond

company e.g. HDFC- Std life has a

They are run by expert fund

min. premium of Rs.10,000.p.a.

managers

varies

from

company

to

I'll usually have to invest for at least

5 years.

They are free from personal capital

gains tax.

Unit Link Investment Plans of Birla Sun Life Insurance Company Ltd.
Before we discuss the plans in detail lets be accustomed to certain common terms like:
SA- Sum Assured
It is the amount for which a person is insured, so it becomes the minimum amount, which
has to be returned to the insured as per the terms of the policy.
LA - Life AssuredHe/she is the person who has taken the insurance cover.
Premium
These are the installments payable by the LA as against the SA. He can either make
monthly, half-yearly & yearly or even one time payment is allowed.

53

Birla Sun Life has 3 Unit Link Investment Plans

UNIT LINKED ING STAR PLAN
UNIT LINKED ENDOWMENT PLAN
UNIT LINKED PENSION PLAN
UNIT LINKED ING STAR PLAN
The plan is affordable, customised to needs and above all, enables I to realise dreams for
child. This plan is well suited for the value-conscious customer, and above all, for every
loving parent. The plan can also be chosen by grandparents, other relatives or any adult for
the benefit of a child
What is the Unit Linked ING Star Plan?
Birla Sun Life Unit Linked ING Star Plan is designed to provide a lump sum to the child at
maturity. It also provides financial security to the child in the future, even in case of the
insured parent's unfortunate death during the policy term. The Unit Linked ING Star Plan
also gives the option of additional protection against the six common critical illnesses.
premiums are invested in units of the investment funds of choice, based on the prevailing
unit prices. On maturity the value of the units will be paid. On death (or critical illness, if
chosen) the selected basic sum assured is paid, and the policy continues until maturity.
Following a valid death or critical illness claim, we will pay the future premiums (at the
level originally chosen at inception) into policy, as and when they would have fallen due.

54

Premiums
I agree to pay a level premium regularly, either quarterly, half-yearly or annually,
throughout the term of the policy. The minimum premium amount is Rs. 10,000 each year.
To facilitate increased investment, we allow additional single premium top-ups at any time.
The minimum single premium top-up is Rs. 5,000
Premiums can be paid by cash, cheque or demand draft.
Choose Investment Funds
The policy is fully unitised with a range of funds to match Ir needs and approach to risk.
(By risk we mean the likely volatility in the value of units in the fund.) Each investment
fund is composed of units. All the units in a fund are identical. I can choose from the
following funds:
Liquid fund
The Liquid fund invests 100% in bank deposits and high quality short-term money market
instruments. The fund is designed to be cash secure and has a very low level of risk;
however unit prices may occasionally go down due to the use of short-term money market
instruments. At inception, investments up to 20% can be allocated to this fund.
Secure Managed fund
The Secure Managed fund invests 100% in Government Securities and Bonds issued by
companies or other bodies with a high credit standing, however a small amount of working
capital may be invested in cash to facilitate the day-to-day running of the fund. This fund
has a low level of risk but unit prices may still go up or down.

55

Defensive Managed
15% to 30% of the Defensive Managed fund will be invested in high quality Indian equities.
The remainder will be invested in Government Securities and Bonds issued by companies
or other bodies with a high credit standing. In addition, a small amount of working capital
may be invested in cash to facilitate the day-to-day running of the fund. The fund has a
moderate level of risk with the opportunity to earn higher returns in the long term from
some equity investment. Unit prices may go up or down.
Balanced Managed
30% to 60% of the Balanced Managed fund will be invested in high quality Indian equities.
The remainder will be invested in Government Securities and Bonds issued by companies
or other bodies with a high credit standing. In addition a small amount of working capital
may be invested in cash to facilitate the day-to-day running of the fund. The fund has a
higher level of risk with the opportunity to earn higher returns in the long term from the
higher proportion it invests in equities. Unit prices may go up or down.
Growth fund
The Growth fund invests 100% in high quality Indian equities. In addition a small amount
of working capital may be invested in cash to facilitate the day-to-day running of the fund.
The fund has a higher level of risk with the opportunity to earn higher returns in the long
term from the investment in equities. Unit prices may go up or down.
The past performance of any of the funds is not necessarily an indication of future
performance.
There are no investment guarantees on the returns of unit linked funds.
None of the funds participate in the profits of HDFC Standard Life Insurance Company
Limited or any of its policyholder funds.
56

Switching of funds.
I can switch existing investments from any of unit linked funds, to any other available unit
linked fund. I can also give us a premium redirection instruction to redirect future premiums
to different unit linked funds.
What are the Benefits?
There are 2 different options available
1. Life Option
This option consists of a Maturity Benefit and a Death Benefit.

The Maturity Benefit will pay the value of the unit-linked fund at the end of the
policy term.

The Death Benefit will pay the basic Sum Assured on death of the life assured
during the policy term. Following payment of this benefit, no further premiums are
due from the policyholder.

Following a valid death claim, we will pay future premiums on Ir behalf, as and
when they become due. The level of premium will be that chosen by I at inception
of the policy.

2. Life and Health Option

This option consists of a Maturity Benefit, a Death Benefit and an Extra Health Benefit.

The Maturity Benefit will pay the value of the unit-linked fund at the end of the
policy term.

The Death Benefit will pay the basic Sum Assured on death of the life assured
during the policy term. Following payment of this benefit, no further premiums are
due from the policyholder and the Extra Health Benefit will lapse without value.

57

The Extra Health Benefit will pay the basic sum assured on diagnosis of any one of
six critical illnesses during the policy term. Following payment of this benefit, no
further premiums are due from the policyholder and the Death Benefit will lapse
without value. The illnesses covered under this benefit are cancer, coronary artery
by pass graft surgery, heart attack, kidney failure, major organ transplant (as
recipient) and stroke.

Following a valid death or critical illness claim, we will pay future premiums on
behalf, as and when they become due. The level of premium will be that chosen by I
at inception of the policy.

58

UNIT LINKED ENDOWMENT PLAN

What is the Unit Linked Endowment Assurance?

The unit linked endowment plan is an insurance policy that is designed to pay a lump sum
on maturity or on earlier death. The Unit Linked Endowment Plan also gives the option of
additional protection against the six common critical illnesses, as well as additional
protection if death is as the result of an accident.
premiums are invested in units of the investment fund of choice, based on the prevailing
unit price. On maturity I receive the value of units. On death (or critical illness, if chosen) I
receive the greater of the value of units and selected basic sum assured.
Premiums
I agree to pay a level premium regularly, either quarterly, half-yearly or annually,
throughout the term of the policy. The minimum premium amount is Rs. 10,000 each year.
To facilitate increased investment, we allow additional single premium top-ups at any time.
The minimum single premium top-up is Rs. 5,000
Premiums can be paid by cash, cheque or demand draft.

59

CHOOSE IR INVESTMENT FUND

The policy is fully unitised with a range of funds to match needs and approach to risk. (By
risk we mean the likely volatility in the value of units in the fund.)
Each investment fund is composed of units. All the units in a fund are identical. I can
choose from the following funds:
Liquid fund
Secure Managed fund
Defensive Managed
Balanced Managed
Growth fund
3. Extra Life Option
This option pays the same benefits as the Life Option but, should death occur within the
policy term as the result of an accident, an extra benefit equal to the Sum Assured will
be paid.
4. Extra Life and Health Option
This option pays the same benefits as the Life and Health Option but, should death
occur within the policy term as the result of an accident, an extra benefit equal to the
Sum Assured will be paid.

60

LEVELS OF PROTECTION AVAILABLE

Depending on Ir age at entry, I may choose between 3 levels of cover Low, Medium or
High. For each level the Sum Assured is based on the amount of premium I pay each year.
Age

at Levels of Cover

Entry

Low

Medium

High

18 to 40

5 x Premium

10 x Premium

20 x Premium

41 to 50

5 x Premium

10 x Premium

Over 51

5 x Premium

The Sum Assured can not be changed during the term of the contract.
How are benefits paid?
Basic benefits will be paid by cheque.

61

ELIGIBILITY
The age and term limits for taking out a Unit Linked Endowment Plan are: (years)

Minimum

Maximum

Maximum

Age at

Age at

Age at

Entry

Entry

Expiry

Maximum

Term
Life

Minimum
Term

10

30

18

60

75

10

30

18

55

65

10

30

18

55

70

10

30

18

55

65

Life and
Health
Extra Life
Extra Life
and Health

Altering the level of premiums

Regular premiums can be increased at any time. If needed, the policyholder can reduce the
regular premium levels (even to zero ie the policy is converted to paid up status) provided:

3 years of regular premiums have been paid

The monetary value of the unit holding across all funds is at least Rs 15,000.

SURRENDERING THE POLICY

The policyholder can surrender the policy at any point of time during the contract term. The
amount payable will be the unitised fund value after applying additional surrender charges
mentioned below.

62

Accessing the money

I can make lump sum withdrawals from I funds provided the fund balance after withdrawal
and charges does not fall below the Sum Assured. The minimum withdrawal amount is Rs.
10,000.
Discontinuity of Premiums
This product has a grace period of 15 days for the payment of each premium after the initial
premium.
If I stop paying premiums, before I have paid 3 years of annual premiums, we will cancel I
policy and return to I the value of unitised fund, less cancellation charges.
If, after three years, I are unable to pay the premiums, I have the option to make the policy
paid-up, provided the policy has accumulated sufficient policy value. Currently, this amount
will be Rs. 15,000.
If I make policy paid up I will continue to be protected according to the benefits I selected.
To provide this cover, we will continue to collect our usual charges on each monthly charge
date. It is important to note that if no further premiums are paid, this may reduce the value
of fund over time, or even exhaust it completely.
A paid-up policy can be reinstated to premium paying status at any point of time in the
future.
If the fund value of a paid-up policy falls below Rs. 15,000 we will cancel the policy and
return to I the fund value, less cancellation charges.
Tax Benefits
Premiums paid under this plan are eligible for tax benefits under Section 88 of the Income
Tax Act, 1961.

63

Charges
Company deduct charges from the policy to cover their costs.
A percentage of each premium is invested to buy units, this percentage is called the
Investment Content Rate.
THE RATES ARE AS FOLLOWS:
Premium paid

Investment Content Rate (ICR)

Regular - Year 1

73%

Regular - Year 2

73%

Regular - Year 3+

99%

Regular Premium Increases

99%

Single Premium Top-Up

99%

The unit price each day will include a fund management charge. This charge is 0.80% of the
fund value per annum taken on a daily basis.
A flat fee of Rs 15 per month will be deducted by cancellation of units on each monthly
charge date. This will be proportioned across funds according to the fund holdings at the
time of cancellation of units.
Risk benefits (for death sum assured, critical illness, and accidental death) will be charged
for by cancelling units on each monthly charge date, based on the persons age at that time.
We charge neither for premium redirections nor for switches but we may do so in the future.
We do not charge for altering the regular premium amount (including making a policy paidup and reinstating a paid-up policy), but we may do so in the future.
On cancellation of the policy before 3 years of regular premiums have been paid, we will
charge 25% of the outstanding premiums due during this 3-year period.

64

Alteration to Charges
No changes can be made to our current charges without prior approval from the Insurance
Regulatory and Development Authority.
In any case, the fund management charge will not exceed 2% per annum.
EXCLUSIONS
No benefit will be paid if the death has occurred directly or indirectly as a result of suicide
within one year from the date of first being covered under the policy.
Company does not pay health benefits if the critical illness has occurred within 6 months of
the start of the contract.
Company may not pay health benefits if we do not receive a duly completed claim form
within 26 weeks of the illness, disability, operation or other circumstances giving rise to the
claim.
Company will not pay health benefits if the critical illness is caused directly or indirectly by
any of the following:

Intentionally self-inflicted injury or attempted suicide, irrespective of mental

condition.

Alcohol or solvent abuse, or the taking of drugs except under the direction of a
registered medical practitioner.

War, invasion, hostilities (whether war is declared or not), civil war, rebellion,
revolution or taking part in a riot or civil commotion.

Taking part in any flying activity, other than as a passenger in a commercially

licensed aircraft.

Taking part in any act of a criminal nature.

Pregnancy or childbirth or complications arising there from.

65

Company will not pay accidental death benefit if death occurs after 90 days from the date of
the accident.
Company will not pay accidental death benefit if death is caused directly or indirectly from
any of the following:

Suicide within one year of the Date of Commencement or the date of issue of the
Policy, if later

Alcohol or solvent abuse, or the taking of drugs except under the direction of a
registered medical practitioner.

Taking part or practicing for any hazardous hobby, pursuit or race unless previously
agreed to by us in writing

War, invasion, hostilities (whether war is declared or not), civil war, rebellion,
revolution or taking part in a riot or civil commotion.

Taking part in any flying activity, other than as a passenger in a commercially

licensed aircraft.

LITERATURE REVIEW
Unit Prices
The Co. set unit price of a fund by dividing the value of the assets in the fund at the
valuation time by the number of units in existence for the fund. The resulting price will be
66

rounded to the nearest Rs. 0.0001. The value of the assets will be calculated as the Market
or Fair Value of the funds Investments plus Current Assets (including accrued income) less
Current Liabilities and Provisions (including accrued expenses). This price will be
published on our companys website.
Prohibition of rebates
Section 41 of the Insurance Act, 1938 states:
1. No person shall allow or offer to allow, either directly or indirectly, as an
inducement to any person to take out or renew or continue an insurance in respect of
any kind of risk relating to lives or property in India, any rebate of the whole or part
of the commission payable or any rebate of the premium shown on the policy, nor
shall any person taking out or renewing or continuing a policy accept any rebate,
except such rebate as may be allowed in accordance with the published prospectuses
or tables of the insurer.
2. Any person making default in complying with the provisions of this section shall be
punishable with fine which may extend to five hundred rupees.

UNIT LINKED PENSION PLAN

What is the Unit Linked Pension Plan?

67

The unit linked pension plan is basically an insurance contract, which is designed to provide
a retirement income for life. Premiums are invested in units of the investment fund of
choice, based on the prevailing unit price. On vesting the value of units will be used to buy
retirement benefits.
On earlier death, the beneficiary receives the value of units plus a cash lump sum of Rs.
1,000.
Premiums
I agree to pay level premiums regularly, either quarterly, half-yearly or annually, throughout
the term of the policy or a single premium at the start of the policy. The minimum premium
amount for regular premium mode is Rs. 10,000 each year and for single premium, it is Rs.
25,000.
To facilitate increased investment, we allow additional single premium top-ups at any time.
The minimum single premium top-up is Rs. 5,000.
Premiums can be paid by cash, cheque or demand draft.
Choose investment funds
The policy is fully unitised with a range of funds to match needs and approach to risk. (By
risk we mean the likely volatility in the value of units in the fund.) Each investment fund is
composed of units. All the units in a fund are identical. I can choose from the following
funds:

Liquid fund
Secure Managed fund
Defensive Managed
Balanced Managed
68

 Growth fund
Switching of funds.
I can switch existing investments from any of unit linked funds, to any other available unit
linked fund. I can also give us a premium redirection instruction to redirect future premiums
to different unit linked funds.
Benefits
At the chosen vesting date, the unitised fund value will be available to secure pension
benefits. Subject to the prevailing regulations, part of this value can be taken in the form of
a cash lump sum and the rest converted to an annuity at the rate then offered by HDFC
Standard Life. Alternatively, if it is permitted by the prevailing regulations, the proceeds net
of any cash lump sum can be used to buy an annuity with any other insurance company who
will accept such business. The current maximum limit for any cash lump sum is one-third of
the unitised fund value on vesting.
On death the unitised fund value will be paid along with a cash lump sum of Rs. 1,000. The
beneficiary may use the proceeds to purchase pension benefits for the surviving spouse.
How are benefits paid?
It basic benefits will be paid by cheque.
Eligibility
The age and term limits for taking out a Unit Linked Pension Plan are: (years)
Minimum Maximum
Term
Term

Minimum Maximum Minimum Maximum

Age at
Age at
Age at
Age at
Entry
Entry
Vesting
Vesting

Regular
Premium
Version

10

40

18

60

50

70

Single

40

18

65

50

70

69

Premium
Version

Altering the level of premiums

Regular premiums can be increased at any time. If needed, the policyholder can reduce the
regular premium levels (even to zero ie the policy is converted to paid up status) provided:

3 years of regular premiums have been paid

The monetary value of the unit holding across all funds is at least Rs 15,000.

In addition, I can pay single premium top-up(s) at any point of time.

Surrendering the policy
The policyholder can surrender the policy at any point of time during the contract term for
regular premium paying policies. For single premium contracts, the contract needs to
remain in-force for a minimum period of six months before I can surrender.
The amount payable will be the unitised fund value after applying additional surrender
charges mentioned below.
Discontinuity in paying premiums in regular premium paying contract
This product has a grace period of 15 days for the payment of each premium after the initial
premium.
If I stop paying premiums, before I have paid 3 years of annual premiums, company will
cancel policy and return to I the value of unitised fund, less cancellation charges.
If, after three years, unable to pay the premiums, I have the option to make the policy paidup, provided the policy has accumulated sufficient policy value. Currently, this amount will
be Rs. 15,000.

70

If I make policy paid up I will continue to be protected according to the benefits I selected.
To provide this cover, we will continue to collect our usual charges on each monthly charge
date. It is important to note that if no further premiums are paid, this may reduce the value
of fund over time, or even exhaust it completely.
A paid-up policy can be reinstated to premium paying status at any point of time in the
future.
If the fund value of a paid-up policy falls below Rs. 15,000 we will cancel the policy and
return to I the fund value, less cancellation charges.
Tax Benefits
Premiums paid under this plan are eligible for tax benefits under Section 80CCC of the
Income Tax Act, 1961.
Charges
Company will deduct charges from the policy to cover their costs.
A percentage of each premium is invested to buy units; this percentage is called the
Investment Content Rate. The rates are as follows:
Investment
(ICR)

Premium paid (Rs)

Single Premium
Initial Payment

94%

Single Premium Top-Up(s)

99%

Regular Premiums
Year 1

78%

Year 2

78%

Year 3 +

99%
71

Content

Rate

Regular Premium Increases

99%

Single Premium Top-Up(s)

99%

The unit price each day will include a fund management charge. This charge is 0.80% of the
fund value per annum taken on a daily basis.
A flat fee of Rs 15 per month will be deducted by cancellation of units on each monthly
charge date. This will be proportioned across funds according to the fund holdings at the
time of cancellation of units.
Company do not charge for the flat death cover of Rs. 1,000, but we may do so in the
future.
Company do not charge for premium redirections or switches but we may do so in the
future.
Company do not charge for altering the regular premium amount (including making a
policy paid-up and reinstating a paid-up policy), but we may do so in the future.
On cancellation or surrender of the policy before 3 years of regular premiums have been
paid, we will charge 20% of the outstanding regular premiums due during this 3-year
period.
ALTERATION TO CHARGES
No changes can be made to companys current charges without prior approval from the
Insurance Regulatory and Development Authority.
In any case, the fund management charge will not exceed 2% per annum.
Exclusions
There will be no exclusions on this policy.

72

GENERAL INFORMATION
Unit Prices
Company will set the unit price of a fund by dividing the value of the assets in the fund at
the valuation time by the number of units in existence for the fund. The resulting price will
be rounded to the nearest Rs. 0.0001. The value of the assets will be calculated as the
Market or Fair Value of the funds Investments plus Current Assets (including accrued
income) less Current Liabilities and Provisions (including accrued expenses). This price
will be published on companys website.

PROHIBITION OF REBATES

Section 41 of the Insurance Act, 1938 states:

73

1. No person shall allow or offer to allow, either directly or indirectly, as an

inducement to any person to take out or renew or continue an insurance in respect
of any kind of risk relating to lives or property in India, any rebate of the whole or
part of the commission payable or any rebate of the premium shown on the policy,
nor shall any person taking out or renewing or continuing a policy accept any
rebate, except such rebate as may be allowed in accordance with the published
prospectuses or tables of the insurer.
2. Any person making default in complying with the provisions of this section shall
be punishable with fine which may extend to five hundred rupees.

74

COMPARE TO THE ATHOR COMPANY

ICICI PRUDENTIAL LIFE INSURANCE

PREMIER LIFE
How does Premier Life work for I
I can choose a specified level of protection according to need. Part of the contribution paid
is adjusted towards mortality and administrative charges and the rest is invested in the
investment option of choice. Entry into the plan will be based on the unit value of the
investment option at theta time. policy value is based on the value of units slated to I.

How do You start?

Open an account with a minimum contrition of:
Rs 60,000 per annum for annual premium payment
Rs.30,000 per half-year for half yearly premium payment
Rs. 5,000 per month for Monthly premium payment.
Asset Allocation
Fund
Maximiser II
Balancer II
Protector II
Preserver

Asset Mix
Equity and Related Securities : Max 100 %
Debt, Money Marker and Cash :Max : 25%
Equity and Related Securities : Max 40 %
Debt, Money Marker and Cash :Max : 60%
Equity and Related Securities : Max 100 %
Debt, Money Marker and Cash :Max : 25%
Debt Instruments : Max 50 %
Money and cash : Min 50 %

75

Potential Risk-Reward
High
Average
Moderate
Low

Allocation of Premium
Premium Range
Rs. 60,000 Rs.4,99,999
Rs. 5,00,000 and above

1st Year

2nd and 3rd Year

87%
89 %

96%
96 %

Invest Assure; a unique, flexible insurance plan combines the security of a life insurance
policy with the opportunity to exploit the upside of market returns.

(However with

increased investment volatility)

Invest Assure-The Benefits
Provides security to family incase of unfortunate demise.
Gives I the flexibility to choose fund based on risk comfort.
Enables I to enjoy market-linked returns with a potential for higher growth
Brings I additional income on funds that might have otherwise given I minimum
returns in saving account.

76

MAX NEW YORK LIFE

Life Maker Unit Linked Investment Plan
A winning plan form every direction
1f How does the Life Maker Unit Linked Investment Plan work?
In the Life Maker TM unit linked plan; the premiums I pay are invested in funds offered by us.
The appropriate ratio of investments into these funds will be determined by I in consultation with
Agent Advisor. These funds are invested in assets such as equities, money market instruments,
investment grade corporate bonds, and government securities. These funds offer a wide range of
returns. I can choose to invest premiums in one or more of these funds, basis risk taking ability.
In turn, we issue units, which represent the value of policy Le. I can "see" the value of policy on
any day by multiplying the number of units by the value of units on that day. The value of these
units is called the Net Asset Value (or NAV) and is normally published in newspapers on a daily
basis. The NAV is based on the market value of the underlying investments in that fund Le.
equities, company bonds, government securities, etc.
Types of Funds
Secure Fund - invests 100% in high quality fixed income securities issued by the Government
of India, or companies or other bodies corporate with a high credit rating. This fund will have
low level of risk and return.
Conservative Fund - invests largely in high quality fixed income securities issued by the
Government of India or companies or other bodies corporate with a high credit rating. A small
portion of the fund, not exceeding 15%, may be invested in high quality Indian equity stocks.
This fund will have a low to moderate level of risk and return.

77

Balanced Fund - invests in both high quality fixed income securities issued by the Government
of India or companies or other bodies corporate with high credit rating, as well as in high quality
Indian equity stocks. However, the investment in equities will not exceed 40% of the size of the
fund. This fund will have a moderate level of risk and return.
Growth Fund - invests largely in high quality Indian equity stocks. A small portion of the fund
may be invested in high quality fixed income securities issued by the Government of India or
companies or other bodies corporate with high credit rating. This fund will have a moderate to
high level of risk and return.

Allianz Bajaj Unit Gain

The Allianz Bajaj Unit Gain Plan
The Allianz Bajaj Unit Gain comes with a host of features to allow I to have the best of all
worlds Protection and Investment with flexibility like never before.
Some of the key features of this plan are:

Guaranteed death benefit

Choice of investment funds with flexible investment management I can change funds at
any time.

Attractive investment alternatives to fixed- interest securities.

Provision for full/ partial withdrawals any time after three full years premiums are paid.

Unmatched flexibility to match changing needs.

78

The four funds offered are as under:a) Equity Bond This fund provides the scope of high appreciation over a long term. The
fund will primarily invest in equities & is expected to match returns given by NSE
NIFTY. This fund will invest at least 90% in equities and maximum 10% in cash.
b) Debt Fund This fund provides the scope for steady returns at low risk through
investment in high quality fixed income securities. This fund will be invested fully in
debt instruments.
c) Balanced Fund The balanced fund is primarily for those who prefer a mix of steady
returns & growth. The balanced fund will invest 30% to 50% in the equity fund and 50%
to 70% in the debt fund.
d) Cash Fund The cash fund will invest conservatively in money market & short-term
investments to ensure that return on investments shall never be negative. 100% of this
fund will be invested in money market instruments. The price of the units in this fund is
guaranteed never to go down.

79

KOTAK FLEXI PLAN

What is the Kotak Flexi Plan?

An investment cum insurance plan that can be customized to meet constantly evolving needs.
While on one hand it lets I decide the amount of insurance cover that I want, on the other hand, it
invests a portion of the premium in the capital markets to ensure that money works hard for I.
At the same time the plan ensures that I have enough flexibility to meet financial objectives of
savings and protection, both through this single plan. The plan gives I the option to add lump
sum injections, when I want. And whats more it cover, I the flexibility to withdraw funds in part
in full.
Plan Description
When I invest in the plan, I have the flexibility to choose the portion of money that should go
towards providing insurance cover, and the portion should go towards the investment corpus.

Maturity Benefit:- I have the option to choose the sum assured that I would want on maturity.
This sum assured would be referred to as the maturity sum assured or SA1. Portion of the
premium corresponding to this amount would be referred to as the investment premium or P1.
On maturity, I would event of death of the life insured, the beneficiary would receive SA2 plus
the market value of the units, less unpaid P2 premiums.
Death Benefit:- The plans offer I the flexibility to decide the amount of insurance cover that I
want. The amount of insurance cover selected would be referred to as the insurance sum assured
or SA2. Portion of the premium corresponding to SA2 would be referred to as the insurance
premium or P2.
80

In the unfortunate event of death of the life insured, the beneficiary would receive SA2 plus the
market value of the units, less unpaid P2 premiums.
Money Market Fund The fund seeks to provide reasonable returns commensurate with low
risk through investments in money market instruments such as treasury bills, commercial paper,
call money market, etc.
Floating Rate Fund The fund seeks to deliver returns in line with the market interest rate,
from a portfolio invested primarily in floating rate debt instruments.
Gilt Fund The fund seeks to generate returns through investments primarily in government
securities. The fund gives I an option to invest in zero credit risk Central Government securities
as it recognizes that safety for I is prime.
Bond Fund The fund seeks to generate returns from a portfolio constituted primarily of high
quality debt paper issued by corporate in India.
Balanced Fund The fund seeks to achieve steady income and capital appreciation from a
portfolio constituted of high quality debt securities and listed equity.
Growth Fund The fund seeks to achieve capital appreciation through investments in listed
equity and equity related investments. Securities will be enhanced through holdings in highly
rated debt securities.

81

Eligibility
ENTRY AGE

Min 14 years
Max 65 years

TERM OF THE PLAN

Min 10 years
Max 30 years

LUMP SUM INJECTION

Min Rs 10,000

AMOUNT

Thereafter in multiples of Rs. 10,000

PART WITHDRAWLS AMOUNT

Min Rs. 10,000

Max Subject to leaving behind a balance of Rs.
10,000 in the Main Account

SA2

Min Rs. 50,000

P1 (INCLUDING POLICY FEES)

Mode

Amount

Quarterly

Rs . 2,620

Half Yearly

Rs. 5,115

Yearly

Rs. 10,000

82

LIFE INSURANCE CORPORATION

LICs Future plus

It fulfills an existing Mkt. Demand & combines Retirement Benefits with U.L. Benefits
Features:1) Min Premium = 10,000
2) Max Premium = No Limit
3) Mode of Payments Cash unto any amount or Local Cheque / D.D.
4) Add onus Ins. Cover/ Accidental Benefit/Critical illness optional
5) Switch over from fund to another any number of time.
6) 4 Switches free in a yr & Rs. 100 per switch over thereafter.
7) Min Term 5 yrs.
8) Vesting Age 40-75 yrs.
9) Any person b/w 18-65 yrs only.
10) Add to fund any time & any amount in multiple of 1000 only.
11) No medical Exam
12) Zero lock in period.

83

RESEARCH METHODOLOGY

The research design is the conceptual structure with in which research is conducted it consist
the blue print of the collection measurement and analysis of data.
In that project the research design was adopted for the Descriptive research study the
exploratory research studies are also termed as formulate research studies. The main purpose of
such studies is that of formulating a problem for more precise investigation or of developing the
working hypothesis from an operational point of view
The main purpose of the study was to tell the consumer perception in A . The major
emphasis was on the discovery of the ideas and opinions of the consumers at different levels in
the existing environment.
Two methods that are used for the study are:
1. The survey of concerning literature.
2. The experience study.

SAMPLE DESIGN
A sample design is a definite plan for obtaining a sample from a given population. It
refers to the technique or the procedure the researcher would adopt in selecting items for the
sample. The sample design is determined before data are collected.
The sampling used for the study is Convenience Sampling. Under this sampling design
every item or the universe has equal chance or inclusion in the sample because this is
Consumers Perception survey, so we give each person at any place an equal probability of
getting into the sample.
84

DATA COLLECTION
TYPES OF DATA
In the survey two types of data are collected:
1. Primary data: These datas are those which are collected for the first time and therefore
original in nature.
2. Secondary data: Data, which have already been collected by someone else and hence
passed through the statistical process.

DATA SOURCE

PRIMARY DATA COLLECTION

For the collection of the primary data following methods were used:
1. Interview method: Personal interviews of the customers are taken at different levels to get
their opinions and suggestions. And the interview was structured in nature.
2. Questionnaire method: Structured questionnaire on the basis of information collected
from different sources. The questionnaire contains both open and ended questions.

SECONDARY DATA COLLECTION

Secondary data were collected from the following sources:

a. Books related to topic
b. Organization documents
c. Magazines
d. Websites

85

DATA APPROACHES
Stratified Random Probability Sample Selection Method.

Research Instrument
Questionnaire
Focus Group
Observation
Direct Method

MECHANICAL INSTRUMENT:
Telephonic Method
POPULATION:
Sampling Unit: Birla Sunlife Insurance , Moradabad.
Sample size: Approximate 100

Sample Selection Procedure : Probability

Contact Method
Direct method
Telephone

STATISTICAL TOOLS USED

Statistical tools used in the project study are:
Graph.

86

FINDING & ANALYSIS

Question 1-.PERCENTAGE OF PEOPLE HAVING LIFE INSURANCE POLICY?

Option

No. of Respondents

percentage

Insured

139

93%

Not Insured

11

7%

7%

93%

Sample size 100

Interpretation:
The above diagram represent that 93% of people are covered under life insurance while 7% are
still not insured.

87

Ques.2 Which Birla Sun Life Scheme does you have?

Scheme
Health
Retirement
Life

No. of Respondents
15
33
102

Percentage
10%
22%
68%

Interpretation:
On the basis of above analysis it has been concluded that around 68% of the policy holders are
having life plan, 22% of them are having Retirement plan and rest of them are having the health
plan.

88

Question.3 Are you satisfied with the Insurance plan which you have?

Option
Yes
No

No. of Respondents
108
42

Percentage
72%
28%

Interpretation:
On the basis of the analysis it has been concluded that around 72%of the people are satisfied
with plan they and rest if them are not satisfied.

89

Ques.4. Are you satisfied with the services provided by the company regarding new plans
and schemes?

Option
Yes
No

No. of Respondents
123
27

Percentage
82%
18%

Interpretation:
On the basis of the above analysis it has been concluded that around 82% of the policy holders
are satisfied with the services provided by the company and rest of them are not satisfied.

90

Ques.5 Are you interested to make more investments in BSLI ?

Option
Yes
No

No. of Respondents
49
101

Percentage
33%
67%

Interpretation:
On the basis of the above analysis it has been concluded that around 67% of the policyholders
are interested to make more investments in BSLI and rest of them are not interested.

91

Ques.6 Have you any other Insurance Plan apart from BSLI?
Option
Yes
No

No. of Respondents
109
41

92

Percentage
78%
22%

Option
LIC
BSLI
BAJAJ ALIYANZE
ICICI
Others

No. of Respondents
75
37
17
14
7

Percentage
50%
25%
11%
9%
5%

Interpretation:
From the above analysis it has been concluded that 50 % are having LIC insurance plans, 11%
are having Bajaj Allianz, 25% are having Birla Sunlife, 9% are having ICICI Pru. and 5%
are having other company insurance plans.

93

Ques.7 If you get any attractive plan than are I ready to switch over?

Option
Yes
No

No. of Respondents
123
27

Percentage
82%
18%

Interpretation:
On the basis of the above analysis it has been concluded that around 82% of the policy holders
are ready to switch over if they get good attractive insurance plan and rest of them dont.

Question 8.-PERCENTAGE OF PEOPLE INSURED WITH DIFFERENT COMPANIES

94

Option
LIC
HDFC-Std Life Insurance
ICICI
Birla Sunlife
Tata AIG

No. of Respondents
108
6
15
2
2

Percentage
72.5%
3.9%
10.8%
1%
1%

Max New York Life

No Response

8
9

4.9%
5.9%

Interpretation:
While LIC still remains the undisputed leader with a commanding share of 72.5%.LIC is
beginning to feel the pinch of a gradual warning of market share from 100%three years ago.
Knocked by competition from private players it is making serious changes in its marketing
strategies.
Question 9 - From where did You get the information about the policy?.

95

Interpretation:
Friends and relatives play a significant role in influencing the individuals decision regarding
going for life insurance policy, followed by advisors or financial consultants then media and
others.

96

Question 10-How much of income would you like to invest in insurance annually?

Income group
No of

1000-5000
54

6000-10000
58

11000-20000
20

20000&above
18

Respondents
Percentage

36.3

39.2

12.7

11.8

Interpretation:
Around 40% of respondents are willing to invest in insurance between Rs 6000-Rs 10000.
annually. 36.3% people are ready to invest between Rs 1000 to Rs 5000 and very few are willing
to invest in insurance above Rs10000 annually.

Question 11- Give a choice you would prefer to invest in?

97

Investment Options

No. of Respondent

Percentage

Fixed Deposits

46

31.4

Post Office Schemes

33

21.6

NSS

22

14.7

Shares

13

8.8

Insurance

20

12.7

Others

16

10.8

Interpretation:
Mostly people are interested in investing in FDs, Post office schemes, NSS and Very few are i.e.
12.7% interested in investment in Insurance

Question 12- In future, which life insurance plans you will prefer?
98

PLANS

NO. OF RESPONDENTS

PERCENTAGE

Pension Plan

82

55%

Protection Plan

18

12%

Saving Plan

12

8%

Investment Plan

32

21%

ULIP

4%

PENSION PLAN

4%

PROTECTION
PLAN

20%

SAVING PLAN

56%
8%

INVESTMENT
PLAN

12%

ULIP

Interpretation:
The graph indicates that 55% of people will like to go for Pension Plan in future as most of them
want to make their future secure . Very few people are aware of Unit Link Plans and would like
to invest in them one of the reason for this can be lack of information about such Plans.

99

Question 13- What expectations do you have from the advisor/FC?

Expectations
Knowledge
Rebate
Understanding
After Sale Service

No. of Respondents
63
39
40
8

Percentage
42
26
27
5

KNOWLEDGE

5%
27%

REBATE

41%

UNDERSTANDING

27%
AFTER SALE SERVIC E

Interpretation:
Around 42% of people expect the Advisors / FC to be knowledgeable about the various
Insurance Plans and very less importance i.e. 5% is given to after sale service being provided by
these advisors.

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Question 14- While taking insurance plan how you rate the following?

Purpose of Insurance

No. of Respondents

Percentage

Tax Benefits

34

23.7

Investment

48

32.3

Saving

36

24.7

Risk

32

19.3

Interpretation:
According to the rating, it has been found that people take insurance basically for risk coverage
i.e. 19.3% and secondly in order to get tax benefits i.e.. 23.7%, followed by savings i.e.24.7%
and very few think it for investment Options.

CONCLUSION

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Over the past three years, around 40 companies have expressed interest in entering the sector and
many foreign and Indian companies have arranged anticipatory alliances. The threat of new
players taking over the market has been overplayed. As is witnessed in other countries where
liberalization took place in recent years we can safely conclude that nationalized players will
continue to hold strong market share positions, but there will be enough business for new
entrants to be profitable.
Opening up the sector will certainly mean new products, better packaging and improved
customer service. Both new and existing players will have to explore new distribution and
marketing channels. Potential buyers for most of this insurance lie in the middle class. New
insurers must segment the market carefully to arrive at appropriate products and pricing.
Recognizing the potential, in the past three years, the nationalized insurers have already begun to
target niches like pensions, women or children.
Given the industrys huge requirement of start-up capital, the initial years after opening up are
bound to see a strong inflow of foreign capital. Substantial shift in the distribution of insurance
in India is likely to take place. Many of these changes will echo international trends. Worldwide,
insurance products move along a continuum from pure service products to pure commodity
products.
Finally, some potential Indian entrants into insurance hope to ride their existing distribution
networks and customer bases. For example financial organizations like ICICI, HDFC or BIRLA
intend to tap the thousands of customers who already buy their deposits, consumer loans or
housing finance. Other hopeful entrants anticipate specific alliances such as with hospitals to
provide health cover.

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SUGGESTIONS
1.

To address mass is cheaper. Thus sponsoring the events conducted by CII, FICCI, PHD
Chamber of commerce and other such renowned organizations could be fruitful. Along
with these certain cultural events may be sponsored.

2.

Increasing awareness level by increasing number of hoarding in prime areas such as Bank
Square sector , railway station, bus stand and industrial area.

3.

There should be no upper limits for CFC's under a BDM because as competition goes
companies like Allianz Bajaj and Tata AIG has no upper limits.

4.

Measures to build faith among people about corporate BIRLA SUN LIE INSURANCE
must be taken on accounts of its reliability, credibility, responsibility, sincerity and the
long lasting establishment.

5.

Since all the riders attached with any of its products is along with a slight increment in
the premium rates, as such a few cost free riders should be designed to attract more
customers.

6.

Put up ATM's in different areas so that premium can be collected across the country.

7.

There should be a particular. Product, which can be termed as Fixed Deposit Insurance
product, where life insurance policy can act as a fixed deposit for the customer, which
can be encashed whenever required up to a certain percentage of sum assured.

8.

The agent should not only be provided with training at time of section but they should
also be given refresher training periodically. As the agents find training a step to be
selected as an agent of the company, the agent should be provided the knowledge about
all the cheques. It increase their professionalism make them more competitive. Every
year the agents should be given the training for at least one week.
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9.

The company should take steps to give more incentives to the agents as the commission
percentage is fixed by insurance regulatory developments authority (IRDA).

10.

As the most important media to increase the sate, the agent should be provided with more
and more incentives to motivate them to work for that company only.

11.

The company should also make effort in advertisement through city Cable Channel as
wide is covered by it Banners on the highway or other crowded area should be setup.

12.

The company should cover various risks in one policy with same premium.

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LIMITATIONS

Some of the respondents were not cooperative.

Some respondents were hesitating to give business details.
Biasness is another limitation that the scope of the survey.
The reliability and scope of survey greatly relies on the cooperation of the respondents.
People did not cooperate while filling the questioner.
Few of the people did not filled the full questionnaire.
Maximum people complaint regarding the length of the questionnaire, they thought
it is lengthy.
People Ire not honest in filling the questionnaire thats why the data is not exact.
Time consuming.
Too much expensive.
Lack of awareness among the respondent.
Most calls are obtained at the sufferance of the respondent .The interviewer is
unknown to the respondent .
Survey was restricted to the people who have telephone facility.

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BIBILIOGRAPHY

BOOKS Kothari C.R. , Research Methodology, 4th Edition 2002.

Kottler Philip, Marketing Management, 10th Edition, Prentice- Hall of India Pvt. Ltd.,
2001.
Thakur Devendra, Research Methodology, Deep & Deep Publication Pvt. Ltd. , 2005.

MAGAZINES

India Today
Business World
Money
Business Week

INTERNET
www.birlasunlife.com
www.birlasunlifeinsurance.com

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QUESTIONNAIRE

1.

Do you Have Life Insurance Policy?

a) YES

b) NO

2. Which Birla Sun Life Scheme do you have?

(a) Life

(b) Retirement

(c) Health

3. Are I satisfied with the Insurance plan you have?

(a) Yes

(b) No

4. What attract you towards Birla Sun Life Plans?

(a) Service
(b) Chief Plans
(c) LIC & GI
(d) Family Flotter
5. Are you satisfied with the services provided by the company regarding new plans and
schemes?
(a) Yes

(b) No

6. Are you interested to make more investments in Birla Sun Life ?

(a) Yes

(b) No

7. Have you any other Insurance Plan apart from Birla Sun Life?
(a) Yes

(b) No

8. If yes, then of which Life Insurance Company?

(a) LIC
(c) Birla Sunlife
(e) Others

(b) Bajaj Allianz

(d) Reliance

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9. If you get any attractive plan than are you ready to switch over?
(a) Yes

(b) No

10 a) If YES, which Company Life Insurance you have opted for.

a) HDFC Standard Life
b) ICICI Pru

e) Max New York Life

f) Bajaj allianz

c) Birla Sun Life

g) AVIVA

d) TATA AIG

h) LIC

b) If NO, do you intend to take Life Insurance in near future?

a) YES

b) NO

11. From where did you get the information about this policy?
a) Friends & Relatives

b) Media

c) FCs& Advisor

d) Others
12. While taking an insurance plan how do you rate the following: a) Risk coverage

b) Savings

c) Tax Benefits

d) Investments
13. How much of income would you like to invest in insurance annually?
a)Rs 1,000-5000

b) Rs 6,000-10,000

c) 11,000-20,000
d) 20000&Above
14. Given a choice you would prefer to invest in: a) Fixed deposits

b) Post office

c ) NSS/NSC

d) Shares

e) Insurance

f) Others

15. In Future, which life insurance plans you will prefer?

108

a) Pension Plan

b) Protection Plan

d)Investment Plan

e) Unit Link Plans

c)Savings Plan

16. What expectations do you have from the advisor / FC?

a Knowledgeable

b Rebate I and suggest I a right plan

c Understand I & suggest I a right plan

d After Sale Service
17. ANY SUGGESIONS:
1..
2..
3..

Name: ---------------------------------------------------------Address/Phone No: -------------------------------------------Age ------------------------------------------------------------Organization and Designation---------------------------------

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