PERFORMANCE ANALYSIS OF ULIP FUNDS WITH SPECIAL REFERENCE TO LIC
A Major Project Report
Submitted in partial fulfillment of the requirements for BBA (Banking & Insurance) Semester VI Programme of G.G.S.Indraprastha University, Delhi.
Submitted by:Shashank Jain
BBA(B&I) Semester VIEnrl. No: 0731241808
Delhi Institute OF Rural DevelopmentNangli PoonaDelhi - 110036
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DECLARATION
I hereby declare that the major project report, entitled “Performance Analysis of ULIP Funds with
Special Reference to RELIANCE”, is based on my original study and has not been submitted earlier for
award of any degree or diploma to any institute or university.
The work of other author(s), wherever used, has been acknowledged at appropriate place(s).
Place: New Delhi Candidate’s Signature
Date: 31st March 2011 Name: Shashank jain
Enrol. No. : 0731241808
Countersigned
Name: Name:
Supervisor Director
Delhi Institute of Rural Development Delhi Institute of Rural Development
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ACKNOWLEDGEMENT
With profound sense of gratitude and regard, I express my sincere thanks to my guide and
mentor Mrs. Manisha for his valuable guidance and the confidence he instilled in me, that
helped me in the successful completion of this project report. Without his help, this project
would have been a distant affair.
His thorough understanding of the subject and the professional guidance is indeed of
immense help to me.
Shashank Jain
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TABLE OF CONTENTS
CHAPTER 1:-
An Introduction to Ulip plans
CHAPTER 2:-
A FROFILE OF RELIANCE CAPITAL AND RELIANCE MUTUL FUND
CHAPTER 3:-
Project profile and unit linked plans of reliance
capital
Research methodology
Importance of the study
Objective
Hypothesis
Sample size and type
Statistical tool
CHAPTER 4:-
Data interpretation and analysis
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CHAPTER 5:-
Findings & suggestion
CHAPTER 6:-
Conclusion
Anexxure
Questionnaire
Bibliography
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CHAPTER 1:-
An Introduction to Ulip plans
ULIPS
WHAT IS ULIP?
ULIP stands for Unit Linked Insurance Plans. As we know that insurance is for protecting
our life from the any uncertain events like death or accident. The purpose of the normal
insurance plan is just protecting the life but not ensuring any savings for the future. Many
people wanted plan which gives protection also gives the returns for their investment. So,
insurance companies come up with the ULIP plan where the premium about is invested in
the share market and returns better income on the maturity period.
PLATFORMS OF LIFE INSURANCE- UNIT LINKED INSURANCE PLANS
World over , insurance come in different forms and shapes . although the generic names
may find similar , the difference in product features makes one wonder about the basis on
which these products are designed .With insurance market opened up , Indian customer has
suddenly found himself in a market place where he is bombarded with a lot of jargon as
well as marketing gimmicks with a very little knowledge of what is happening . This
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module is aimed at clarifying these underlying concepts and simplifying the different
products available in the market.
We have many products like Endowment , Whole life , Money back etc. All these products
are based on following basic platforms or structures viz.
Traditional Life
Universal Life or Unit Linked Policies
3.1 TRADITIONAL LIFE – AN OVERVIEW
The basic and widely used form of design is known as Traditional Life Platform. It is based
on the concept of sharing . Each of the policy holder contributes his contribution (premium)
into the common large fund is managed by the company on behalf of the policy holders.
Administration of that common fund in the interest of everybody was entrusted to the
insurance company .It was the responsibility of the company to administer schemes for
benefit of the policyholders. Policyholders played a very passive roll . In the course of time
, the same concept of sharing and a common fund was extended to different areas like
saving , investment etc.
A Unit Link Insurance Policy (ULIP) is one in which the customer is provided with a life
insurance cover and the premium paid is invested in either debt or equity products or a
combination of the two. In other words, it enables the buyer to secure some protection for
his family in the event of his untimely death and at the same time provides him an
opportunity to earn a return on his premium paid. In the event of the insured person's
untimely death, his nominees would normally receive an amount that is the higher of the
sum assured or the value of the units (investments).
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To put it simply, ULIP attempts to fulfill investment needs of an investor with
protection/insurance needs of an insurance seeker. It saves the investor/insurance-seeker
the hassles of managing and tracking a portfolio or products. More importantly ULIPs
offer investors the opportunity to select a product which matches their risk profile.
Unit Linked Insurance Plans came into play in the 1960s and became very popular in
Western Europe and Americas. In India The first unit linked Insurance Plan , popularly
known as ULIP – Unit Linked Insurance Plan in India was brought out by Unit Trust Of
India in the year 1971 by entering into a group insurance arrangement with LIC o provide
for life cover to the investors , while UTI , as a mutual was taking care of investing the
unit holders money in the capital market and giving them a fair return .
Subsequently in the year 1989 , another Unit Linked Product was launched by the LIC
Mutual Fund called by the name of “DHANARAKSHA” which was more or less on the
line of ULIP of UTI . Thereafter LIC itself came out with a Unit Linked Insurance Product
known by name “BIMA PLUS “ in the year 2001-02 .
Presently a number of private life insurance companies have launched Unit Linked
Insurance Products with a variety of new features.
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TYPES OF ULIP
There are various unit linked insurance plans available in the market. However, the key
ones are pension, children, group and capital guarantee plans.
The pension plans come with two variations — with and without life cover — and are
meant for people who want to generate returns for their sunset years.
The children plans, on the other hand, are aimed at taking care of their educational and
other needs..
Apart from unit-linked plans for individuals, group unit linked plans are also available in
the market. The Group linked plans are basically designed for employers who want to offer
certain benefits for their employees such as gratuity, superannuation and leave encashment.
The other important category of ULIPs is capital guarantee plans. The plan promises the
policyholder that at least the premium paid will be returned at maturity. But the guaranteed
amount is payable only when the policy's maturity value is below the total premium paid
by the individual till maturity. However, the guarantee is not provided on the actual
premium paid but only on that portion of the premium that is net of expenses (mortality,
sales and marketing, administration).
How ULIPs work
ULIPs work on the lines of mutual funds. The premium paid by the client (less any charge)
is used to buy units in various funds (aggressive, balanced or conservative) floated by the
insurance companies. Units are bought according to the plan chosen by the policyholder.
On every additional premium, more units are allotted to his fund. The policyholder can
also switch among the funds as and when he desires. While some companies allow any
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number of free switches to the policyholder, some restrict the number to just three or four.
If the number is exceeded, a certain charge is levied.
Individuals can also make additional investments (besides premium) from time to time to
increase the savings component in their plan. This facility is termed "top-up". The money
parked in a ULIP plan is returned either on the insured's death or in the event of maturity of
the policy. In case of the insured person's untimely death, the amount that the beneficiary is
paid is the higher of the sum assured (insurance cover) or the value of the units
(investments). However, some schemes pay the sum assured plus the prevailing value of
the investments.
ULIP - KEY FEATURES
Premiums paid can be single, regular or variable. The payment period too can be
regular or variable. The risk cover can be increased or decreased.
As in all insurance policies, the risk charge (mortality rate) varies with age.
The maturity benefit is not typically a fixed amount and the maturity period can be
advanced or extended.
Investments can be made in gilt funds, balanced funds, money market funds, growth
funds or bonds.
The policyholder can switch between schemes, for instance, balanced to debt or gilt
to equity, etc.
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The maturity benefit is the net asset value of the units.
The costs in ULIP are higher because there is a life insurance component in it as
well, in addition to the investment component.
Insurance companies have the discretion to decide on their investment portfolios.
Being transparent the policyholder gets the entire episode on the performance of his
fund.
ULIP products are exempted from tax and they provide life insurance.
Provides capital appreciation.
Investor gets an option to choose among debt, balanced and equity funds.
USP of ULIPS
Insurance cover plus savings
ULIPs serve the purpose of providing life insurance combined with savings at market-
linked returns. To that extent, ULIPS can be termed as a two-in-one plan in terms of giving
an individual the twin benefits of life insurance plus savings.
Multiple investment options
ULIPS offer a lot more variety than traditional life insurance plans. So there are multiple
options at the individual’s disposal. ULIPS generally come in three broad variants:
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Aggressive ULIPS (which can typically invest 80%-100% in equities, balance in
debt)
Balanced ULIPS (can typically invest around 40%-60% in equities)
Conservative ULIPS (can typically invest upto 20% in equities)
Although this is how the ULIP options are generally designed, the exact debt/equity
allocations may vary across insurance companies. Individuals can opt for a variant based
on their risk profile.
Flexibility
The flexibility with which individuals can switch between the ULIP variants to capitalise
on investment opportunities across the equity and debt markets is what distinguishes it
from other instruments. Some insurance companies allow a certain number of ‘free’
switches. Switching also helps individuals on another front. They can shift from an
Aggressive to a Balanced or a Conservative ULIP as they approach retirement. This is a
reflection of the change in their risk appetite as they grow older.
Works like an SIP
Rupee cost-averaging is another important benefit associated with ULIPS. With an SIP,
individuals invest their monies regularly over time intervals of a month/quarter and don’t
have to worry about ‘timing’ the stock markets.
HURDLES OF ULIP
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NO STANDARDIZATION
All the costs are levied in ways that do not lend to standardisation. If one company
calculates administration cost by a formula, another levies a flat rate. If one company
allows a range of the sum assured (SA), another allows only a multiple of the premium.
There was also the problem of a varying cost structure with age
CHAPTER 2:-
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A profile of reliance capital and reliance mutual fund
THE INSURANCE INDUSTRY IN INDIA
AN OVERVIEW
With the largest number of life insurance policies in force in the world, Insurance happens
to be a mega opportunity in India. It’s a business growing at the rate of 15-20 per cent
annually and presently is of the order of Rs 1560.41 billion (for the financial year 2006 –
2007). Together with banking services, it adds about 7% to the country’s Gross Domestic
Product (GDP). The gross premium collection is nearly 2% of GDP and funds available
with LIC for investments are 8% of the GDP.
Even so nearly 65% of the Indian population is without life insurance cover while health
insurance and non-life insurance continues to be below international standards. A large part
of our population is also subject to weak social security and pension systems with hardly
any old age income security
A well-developed and evolved insurance sector is needed for economic development as it
provides long term funds for infrastructure development and strengthens the risk taking
ability of individuals. It is estimated that over the next ten years India would require
investments of the order of one trillion US dollars.
HISTORICAL PERSPECTIVE
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The history of life insurance in India dates back to 1818 when it was conceived as a means
to provide for English Widows. Interestingly in those days a higher premium was charged
for Indian lives than the non - Indian lives, as Indian lives were considered more risky to
cover. The Bombay Mutual Life Insurance Society started its business in 1870. It was the
first company to charge the same premium for both Indian and non-Indian lives.
The Oriental Assurance Company was established in 1880. The General insurance business
in India, on the other hand, can trace its roots to Triton Insurance Company Limited, the
first general insurance company established in the year 1850 in Calcutta by the British. Till
the end of the nineteenth century insurance business was almost entirely in the hands of
overseas companies.
Insurance regulation formally began in India with the passing of the Life Insurance
Companies Act of 1912 and the Provident Fund Act of 1912. Several frauds during the
1920's and 1930's sullied insurance business in India. By 1938 there were 176 insurance
companies.
The first comprehensive legislation was introduced with the Insurance Act of 1938 that
provided strict State Control over the insurance business. The insurance business grew at a
faster pace after independence. Indian companies strengthened their hold on this business
but despite the growth that was witnessed, insurance remained an urban phenomenon.
The Government of India in 1956, brought together over 240 private life insurers and
provident societies under one nationalized monopoly corporation and Life Insurance
Corporation (LIC) was born. Nationalization was justified on the grounds that it would
create the much needed funds for rapid industrialization. This was in conformity with the
Government's chosen path of State led planning and development.
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The non-life insurance business continued to thrive with the private sector till 1972. Their
operations were restricted to organized trade and industry in large cities. The general
insurance industry was nationalized in 1972. With this, nearly 107 insurers were
amalgamated and grouped into four companies- National Insurance Company, New India
Assurance Company, Oriental Insurance Company and United India Insurance Company.
These were subsidiaries of the General Insurance Company (GIC).
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Company Profile
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Reliance money is a part of the reliance Anil Dhirubai Ambani Group and is promoted by
Reliance capital, the fastest growing private sector financial services company in India,
ranked amongst the top 3 private sector financial companies in terms of net worth.
Reliance money is a comprehensive financial solution provider that enables you to carry
out trading and investment activities in a secure, cost-effective and convenient manner.
Through reliance money, you can invest in a wide range of asset classes from Equity,
Equity and commodity Derivatives, Mutual Funds, insurance products, IPO’s to availing
services of Money Transfer & Money changing.
Reliance Money offers the convenience of on-line and offline transactions through a
variety of means, including its Portal, Call & Transact, Transaction Kiosks and at it’s
network of affiliates.
Some key steps of the company that are as…..
“Success is a journey, not a destination.” If we look for examples to prove this quote
then we can find many but there is none like that of Reliance Money. The company which
is today known as the largest financial service provider of India.
Success sutras of Reliance Money:
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Reliance Capital
Reliance Life Insurance
Reliance General Insurance
Unit link nsurance plans
Reliance Consumer
Finance
Reliance Mutual fundMutual Fund
The success story of the company is driven by 8 success sutras adopted by it namely trust,
integrity, dedication, commitment, enterprise, hard work and team play, learning
and innovation, empathy and humility. These are the values that bind success with
Reliance Money.
Vision of Reliance Money
To achieve & sustain market leadership, Reliance Money shall aim for complete customer
satisfaction, by combining its human and technological resources, to provide world class
quality services. In the process Reliance Money shall strive to meet and exceed customer's
satisfaction and set industry standards.
Mission statement:
“Our mission is to be a leading and preferred service provider to our customers, and
we aim to achieve this leadership position by building an innovative, enterprising ,
and technology driven organization which will set the highest standards of service
and business ethics.”
BUSINESS OVERVIEW
Reliance Capital has interests in asset management and mutual funds, life and general
insurance, private equity and proprietary investments, stock broking, depository services,
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distribution of financial products, consumer finance and other activities in financial
services.
Reliance Mutual Fund is India's no.1 Mutual Fund. Reliance Life Insurance is India's
fastest growing life insurance company and among the top 4 private sector insurers.
Reliance General Insurance is India's fastest growing general insurance company and the
top 3 private sector insurers. Reliance Money is the largest brokerage and distributor of
financial products in India with more than 2.5 million customers and the largest
distribution network. Reliance Consumer finance has a loan book of over Rs. 8,000 crores
at the end of June 2008.
Reliance Capital has a net worth of Rs.6, 862 crores (US$ 1.6 billion) and total assets of
Rs. 19,940 crores (US$ 4.6 billion) as of June 30, 2008 and over 26,000 employees.
Money has increased its market share among private financial companies to nearly
Convenient & effective – Anytime & anywhere financial transaction capability. Launched
in April 2007. It provides the Flat fees system. It has 2.2 million customers in 1 year of
official launch. It has over 5,000 outlets across 700 towns/cities. Average daily turnover –
in excess of Rs 2,000 crores.
Considering the entire life market, including the Rs. 12,890 crores booked by life insurance
Corporation, Reliance life insurance market share works out to around 6.25%.
The life insurance market continuous to be dominated by LIC which has about 67% share
this only a marginal dip from its 73% share in end-July. These comparisons are only for
first year or new business premium.
The gap between Reliance life insurance and the second-in-line private insurer is vast. In
fact, this scenario has led some analysts to wonder if the company is not a trifle too
aggressive. But others say this has more to do with the companies’ customer-centric focus,
its pan-India presence and superior risk management and investment strategies. Reliance
Money is not, however, resting on its laurels.
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Company’s customer centric approach will be studied during the training period and the
finding of the research work will definitely focus on the present condition & future
requirement (if any) relating to products of company.
Reliance Life Insurance
Demat Account Services
Reliance Mutual Funds
Reliance General Insurance
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Reliance Life Insurance, a part of the Reliance - Anil Dhirubhai Ambani Group is India's
fastest growing life insurance company and among the top 4 private sector life insurers.
Reliance Life Insurance has a pan India presence and a range of products catering to
individual as well as corporate needs. Reliance Life Insurance has over 700 branches and
1, 80,000 agents. It offers 26 products covering savings, protection & investment
requirements. Reliance Life Insurance will endeavor to attain a leadership position in the
market over the next few years, by further expanding and strengthening its distribution
network and offering a diverse array of products to suit the varied and specific needs of
individual customers.
Basics of Life Insurance
What is Life Insurance?
An amount of money paid to someone (called beneficiary) when the Life Assured (in
whose name the insurance policy is taken) dies. This amount can be used to pay the
expenses related to Life assureds death or can be invested to generate income that will
replace your salary. Life Insurance is an important tool in any investors portfolio & can be
used for - wealth creation, asset building, provide for contingencies and retirement
planning.
Types of Life Insurance Policies
Most Insurance policies are a combination of Savings & Protection.
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The main reason to buy Life Insurance is to provide income replacement for your loved
ones
Products are formulated by either increasing or decreasing either one of these
components.
These combinations can be broadly divided into 4 groups
- ULIPs
- Term Insurance
- Endowment Policies : Whole Life; Unit Linked etc
- Annuities & Pension
Life Stage in Life Insurance
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Need Analysis in life Stages
AGE INSURANCE SUGGESTED
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18-25 (Unmarried)
30-45 years Couples with children
45 yrs and above Matured couple Retire
d
25-30 Married couples with no kids
No dependents/ liabilities
therefore need for insurance is
less
Introduction of dependents. Start
of financial planning – balance
between asset creation & protection
Peak earning age range. High asset
creation & build up of liabilities. Critical
stage for dependents Asset base build
up & liabilities reduced/ taken
care of. Need for retirement
planning more than protection.
Need for protection low.
Greater need for regular income
flow.
Endowment / ULIP’s Endowment / ULIP’s + Term Annuities
At each stage, requirements, responsibilities and Financial needs differ
STATUS NEEDS PRODUCTS
18yrs -
25yrs
Unmarried 1.Go on a
holiday
2.Buy a new Car
3.Set up a new
house
4.Set up Interiors
5.Buy jewellery
Short Term
Endowment Product
25yrs -
30yrs
Married
1.High Debt,
high
expenditure
Phase
2.Family
dependency on
your income
3.Low
accumulated
wealth
4.Need for
Planning
Requirement
Temporary term or
whole life Product
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30yrs -
45yrs
Matured
couple
1.Retirement
Planning
2.Wealth
transfer or
saving vehicles
3.Returns on
investment
4.Opting for
guaranteed
Product
Profits or Unit
Linked Endowment/
Deferred annuities
Life Stage Example
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Products of Life Insurance
Life Insurance products are usually referred to as ‘plans’ of insurance. These plans have
two basic elements; one is the “Death Cover” providing for the benefits being paid on the
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Hello, I am Philip, sailor. Hello, I am Philip, sailor. Have seen the world. Have seen the world. Always on cruise and keep Always on cruise and keep worrying about family and worrying about family and the loans. I need financial the loans. I need financial Protection if I do not return Protection if I do not return from one voyagefrom one voyage
Savera has just Savera has just come to our lives. As come to our lives. As proud parents, We proud parents, We need to protect her need to protect her as well as create her as well as create her own financial own financial standingstanding
Worked for almost Worked for almost 25 years, now want 25 years, now want to liveto live……. I want . I want something that will something that will make my life Chinta-make my life Chinta-free after free after retirementretirement……..
Endowment
Term
Annuities
death of the insured person within a specified period. The other is the “Survival Benefit”
providing for the benefit being paid on survival of a specified period.
Plans of insurance that provide only death cover are called “Term Assurance”
Plans.
Plans of insurance that provide only survival benefits are called “Pure
Endowment” Plans.
Term Life Insurance
Term Life Insurance provides protection for a specified period of time. A death benefit is
paid to the beneficiary if the insured dies within a specified period of time while the policy
is still in force.
Whole Life Insurance
Whole Life insurance is a permanent life insurance and provides protection for life. As
long as premiums are paid, a death benefit is paid to the beneficiary.
ULIPs
A ULIP is a life insurance which provides a combination of Life Insurance protection and
investment. Money can be invested in the following fund:- Equity Fund, Debt Fund,
Money Market Fund (Liquid Fund) and Balance Fund.
Annuities
Annuities are practically the same as pension. Pension provides periodical payments to the
employees, who have retired. They are paid as long as the recipient is alive. Annuities are
called the “reverse” of Life Insurance.
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Protection Plans
Protect your family even when you’re not around by investing in Reliance Protection
Plans. Choose a limited period plan or a lifetime protection plan depending on your needs.
The latest Protection Plans are as below…
1. Reliance Term plan
2. Reliance Simple Term plan
3. Reliance Special Term plan
4. Reliance Credit Guardian plan
5. Reliance Special Credit Guardian plan
6. Reliance Endowment plan
7. Reliance Special Endowment plan
8. Rel iance Connect 2 Life plan
9. Reliance Whole Life plan
10.Reliance Wealth + Health plan
11.Reliance Cash Flow plan
Savings & Investment Plans
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Reliance Savings & Investment Plans help you to set aside some money to achieve specific
goals in life, which means that you can enjoy life and provide for your family’s daily
needs. The savings and investment Plans are as below…
1. Reliance Total Investment Plan Series I - Insurance
2. Reliance Wealth + Health plan
3. Reliance Automatic Investment plan
4. Reliance Money Guarantee plan
5. Reliance Cash Flow plan
6. Reliance Market Return plan
7. Reliance Endowment plan
8. Reliance Special Endowment plan
9. Reliance Whole Life plan
10.Reliance Golden Years Plan
11.Reliance Golden Years Plan Value
12.Reliance Golden Years Plan Plus
13.Reliance Connect 2 Life plan
Retirement Plans
Invest today in Reliance Retirement Plans and save money to enjoy life even after
retirement. You will never have to depend on another person or make any compromises to
maintain your current lifestyle. The latest Retirement Plans are as below…
1. Reliance Total Investment Plan Series II – Pension
2. Reliance Golden Years Plan
3. Reliance Golden Years Plan Value
4. Reliance Golden Years Plan Plus
5. Reliance Wealth + Health plan
6. Reliance Automatic Investment Plan
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7. Reliance Money Guarantee Plan
Child Plans
Save systematically and secure your child’s future needs by investing in Reliance Child
Plans. You can always be there for your child when he or she needs you. The Childs plans
are as below…
1. Reliance Child plan
2. Reliance Secure Child plan
3. Reliance Wealth + Health plan
Market Return Plan
Under This plan the investment risk in the investment portfolio is borne by the
policyholder.
key features
Twin benefit of market linked return and insurance protection
A unit linked plan, different from traditional life insurance products with maximum
maturity age of 80 years.
Option to create your own portfolio depending on your risk appetite.
Choose from four different investment funds
Flexibility to switch between funds
Option to pay regular as well as single premium & top- ups
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Option to package your policy with accidental rider
Flexibility to increase the sum assured
Liquidity through partial withdrawals
How does this plan work
The premium paid by the client net of premium allocation charges is invested in
fund/funds of your choice and units are allocated depending on the price of units for the
fund/funds. The fund value is the total value of units that you hold in the fund/funds.
The mortality charges and policy administration charges are ducted through
cancellation of units whereas the fund management charge is priced in the unit value.
Benefits
Life cover Assured: in case of unfortunate loss of life, the beneficiary will get sum
assured or fund value, whichever is higher. The client can choose the basic sum assured
within the minimum and maximum levels mentioned below.
Minimum sum Assured:
Regular premium: annualized premium for 5 years or annualized premium for half
the policy term, whichever is higher.
Single premium: 125% of the single premium.
Maximum sum Assured
No limit (50000 for age up to 12 years)
Maturity Benefits
On survival to maturity the fund value on maturity will be paid out.
Rider Benefits
The Client can add the Accidental Death & Total and Permanent Disablement Benefit
Rider (available only with the regular premium option).
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This benefit doubles the life coverage in case of accidental death or accidental total and
permanent disablement at a very nominal additional cost. The maximum cover is Rs. 50,
00,000 per life.
In case of accidental death of the life assured during the policy term, the accident benefit
sum assured will be paid immediately in a lump sum.
In case of accidental total and permanent disablement, 1/10 th of the accident benefit sum
assured will be paid at the end of each year for ten years. If the total and permanent
disablement has commenced, the accidental death benefit cover ceases.
In case of maturity or on death of the life assured before payment of all installments of
accidental total and permanent disablement benefits, the remaining unpaid installments of
any will be paid in one lump sum along with death or maturity benefit.
Accidental total and permanent disablement means disability caused by bodily injury,
which causes permanent inability to perform any occupation or to engage in any activities
for remuneration or profits. This disability should last for at least 6 months before being
eligible for accidental total and permanent disablement benefits.
Accidental total and permanent disablement includes loss of both arms and both legs or
one arm and one leg or of both eyes. Loss of arms or legs means dismemberment by
amputation of the entire hand or foot. Loss of eyes means entire and irrecoverable loss of
sight.
What are the different fund options.
We understand the value of your hard earned money and in our Endeavour to help you
grow your wealth, we offer you 4 different tailor-made investment funds. You have the
option to allocate your premium in these funds as you wish.
1. Capital Secure Fund:
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The investment objective of this fund is to maintain the value of all contributions (net of
charges) and all interest additions. This fund offers steady return for little risk. The risk
profile of this fund is low. Investments would be 100% in bank deposits, government
bonds and debt instruments that offer financial security.
Further, allocation in Capital Secure Fund for a policy is subject to a maximum limit of
40% at any time.
2. Balanced Fund:
The investment objective of this fund is to provide you with investment returns, which
exceed the rate of inflation in the long term while maintaining a low probability of
negative investment returns. Here, a major portion of your funds are invested in Fixed
Securities while a small percentage is invested in the equity market, which is exposed to
market movements. The risk profile of this fund is low to medium.
Investments would be at least 80% in fixed interest securities and maximum 20% in
equities.
3. Growth Fund:
The investment objective of this fund is to provide you with investment returns, which
exceed the rate of inflation in the long term while maintaining a moderate probability of
negative investment returns. A greater portion of your funds are invested in fixed securities
while a small percentage is invested in the equity market, which exposed to market
movements. The risk profile of this fund is medium to high.
Investment would be at least 60% in fixed interest securities and maximum 40% in
equities.
4. Equity Fund:
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The investment objective of this fund is to provide policyholders with high exposure to
equities and the possibility of investment returns, which generate a high real rate of return
in the long term while recognizing that there is a significant probability of negative
investment returns in the short term. This fund offers a totally equity based investment
option. Your returns depend entirely upon the performance of the equity market. The risk
profile of this fund is high. The higher risk of this portfolio means that expected returns
would also be higher.
Investment would not exceed 30% in bank deposits and may be up to 100% in equities.
Value of Units:
The market value of assets plus/less expenses incurred
In the purchase/sale of assets plus current assets plus
Any accrued income net of fund management charges
Less current liabilities less provision
Unit Value =
Total number of units on issue (before any new units
are allocated/redeemed.)
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Who can Buy the product
What is the
policy term
Minimum policy term 5 years
Maximum policy term 40 years
Flexible premium payment modes:
Choose from five premium payment modes.
a) Annual – minimum premium is Rs. 10,000.
b) Half – yearly – minimum premium is Rs. 5,000.
c) Quarterly – minimum premium is Rs. 2,500.
d) Monthly – minimum premium is Rs. 1,000.
e) Single premium – minimum premium is Rs. 25,000.
Charges under the plan:
1. Premium allocation charge
For regular premium policies:
Term of the policy as below
Years 5-9 10 - 14 15+
First year 10% 15% 20%
Thereafter 5% 5% 5%
(The premium allocation charge for single premium & top – ups is 2%.)
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Minimum age at entry 30 days
Maximum age at entry 65 years
Maximum age at maturity 80 years
2. Policy Administration charges:
Rs. 40 will be deducted from your unit account each month.
3. Fund Management Charges:
(The fund management charges will be deducted on a daily basis.)
Revision of
charges:
The fund
management charges are subject to revision at any time, but hey will not exceed 2% p.a.
for the capital secure fund and 2.5% p.a. for the other funds.
Any changes made to the charges under this policy will be subject to IRDA approval.
4. Partial Withdrawal Charges:
Rs. 100 per withdrawal will be deducted from your unit account.
5. Switching Charge:
1% of the amount switched, with a maximum of Rs. 1,000/- per switch.
6. Mortality Charges:
The Mortality charges, based on your attained age, are determined using 1/12 th of the
charges are different.
7. Surrender Charge:
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Unit Linked Funds Annual Rate
Capital Secure 1.50%
Balanced Fund 1.50%
Growth Fund 1.75%
Equity Fund 1.75%
This charge is levied on the unit fund at the time of surrender of the policy as under:
8. Service Tax Charge
This charge will be levied on mortality, accident & disability benefit charges. The level of
this charge will be as per the rate of service tax on risk premium levied by the government
from time to time the correct rate of service tax is 12.36% this charge shall be collected
along with charges.
How safe is your investment
The investments made in the unit funds are subject to investment risks associated
with capital markets and the NAVs of the units may go up or down based on the
performance of the fund and the factors influencing the capital market, and the
insured is responsible for his/her decisions.
The unit price is a reflection of the financial and equity/debt market conditions and
can increase or decrease at any time due to this.
Benefits payable under the policy will be made according o the tax laws and other
regulations in force at that time.
There are no guarantees for any fund of any kind under this policy. The benefit
payable on maturity will be equal to the value of your units.
The name in the funds in n way indicates the returns derived from them.
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Number of years premiums
paid
Surrender charge as
percentage of fund value
Less than 1 100%
1 50%
2 20%
3 and more NIL
Please note that Reliance life Insurance company limited is only the name of the
insurance company and Reliance market return plan is only the name of the unit
linked life insurance policy and does not in anyway indicate the quality of the policy
or its future prospects or returns
Free Look Period.
In case the policyholder disagrees with any of the terms and conditions of the policy, he
may return the policy to the company within 15 days of its receipt for cancellation, stating
his/her objections in which case the company will refund an amount equal to the non
allocated premium plus the charges levied by cancellation of units plus fund value as on
the date of receipt of the request in writing for cancellation, less the proportionate premium
for the period the company has been on risk and the expenses incurred by the company
medical examination and stamp duty charges. If the risk acceptance date falls within
cooling off period, then on cancellation RLIC shall pay fund value less of charges.
LITERATURE STUDY
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Till today a lot of research has been done on the Indian insurance industry especially the
life insurance sector. The material for this study was collected from various internet sites,
journal sand books by various authors.
Page 40 of 83
The Concept of Mutual Fund
A mutual fund is a common pool of money into which investors place their contributions
that are to be invested in accordance with a stated objective. The ownership of the fund is
thus ‘joint’ and ‘mutual’; the fund belongs to all investors
Reliance Mutual Fund
Reliance Mutual Fund (RMF), a part of the Reliance - Anil Dhirubhai Ambani Group, is
India's leading Mutual Fund, with average Assets under Management of Rs. 90,813 crores
for the month of June 2008, and an investor base of over 6.7 million. Reliance Mutual
Fund offers investors a well rounded portfolio of products to meet varying investor
requirements. Reliance Mutual Fund has a presence in 300 cities across the country and
constantly endeavors to launch innovative products and customer service initiatives to
increase value to investors. Reliance Mutual Fund schemes are managed by Reliance
Capital Asset Management Ltd., a wholly owned subsidiary of Reliance Capital Ltd.
Types of Mutual Funds on the Basis of Risk Vs Returns
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Frequently used term in Mutual Funds
Net Asset Value (NAV)
Net Asset Value is the market value of the assets of the scheme minus its liabilities. The
per unit NAV is the net asset value of the scheme divided by the number of units
outstanding on the Valuation Date.
Sale Price
Is the price you pay when you invest in a scheme. Also called Offer Price. It may include a
sales load.
Repurchase Price
Is the price at which a close-ended scheme repurchases its units and it may include a back-
end load. This is also called Bid Price
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Sector Funds
Risk
Money Market Funds
Floaters
Income Funds
Gilt Funds
MIPs
Balanced Funds
Diversified Equity FundsR
eturns
Redemption Price
Is the price at which open-ended schemes repurchase their units and close-ended schemes
redeem their units on maturity? Such prices are NAV related.
Sales Load
Is a charge collected by a scheme when it sells the units. Also called, ‘Front-end’ load.
Schemes that do not charge a load are called ‘No Load’ schemes
Repurchase or ‘Back-end’ Load
Is a charge collected by a scheme when it buys back the units from the unit holders.
Types of Reliance Mutual Funds
1. Reliance Growth Fund
2. Reliance Vision Fund
3. Reliance Banking Fund
4. Reliance Diversified Power Sector Fund
5. Reliance Pharma Fund
6. Reliance Media & Entertainment Fund
7. Reliance NRI Equity Fund
8. Reliance Equity opportunities Fund
9. Reliance Index Fund
10.Reliance Tax Saver (ELSS) Fund
11.Reliance Equity Fund
12.Reliance Long Term Equity Fund
13.Reliance Regular Saving Fund
The key term in mutual funds
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Dividend Policy: Dividend will be distributed from the available distributable surplus after
the deduction of the divided distribution surplus after the deduction of the dividend
distribution tax and the applicable surcharge, if any. The mutual fund is not guaranteeing
or assuring any dividend. Pease read the offer document for details. Further payment of all
the dividends shall be in compliance with SEBI circular No. SEBI/IMD/CIR No.
1/64057/06 dated 4/4/06.
Applicable NAV : Sale of units by reliance mutual fund: in respect of valid applications
received up to 3 p.m. by the mutual fund alongwith a local cheque or a demand draft
payable at par at the place where the application is
received, the closing NAV of the day on which application is received shall be applicable.
Repurchase including Switch-out: in respect of valid applications received upto 3 pm by
the mutual fund, same day’s closing NAV shall be applicable. In respect of valid
applications received after 3 p.m. by the mutual fund, the closing NAV of the next business
day shall be applicable.
Daily net Asset Value(NAV) publication: the NAV will be declared on all working days
and will be published in 2 newspaper. NAV can also be viewed on
www.reliancemutualfund.com and www.amfiindia.com .
Tax Benefits to the mutual fund: Reliance Mutual Fund is a Mutual fund registered with
the securities & exchange board of India and hence the entire income of the mutual fund
will be exempt from income tax in accordance with the provisions of section 10(23D) of
the income tax act, 1961. The mutual fund will receive all income without any deduction of
tax at source under the provisions of section 196(iv) of the act.
An exemption has been granted under the finance (No.2) act, 2004 to open ended equity
oriented mutual funds from paying distribution tax on income distributed without any time
limit, effective from 1 April 2004.
Securities transaction Tax:
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Name of Transaction Payable by Rate of Tax
Purchase and sale of
equity shares or units of
equity oriented mutual
funds on a recognized
stock exchange on
delivery basis
Both purchaser as well
as seller
0.125%
Sale on stock exchange
of equity shares or units
of equity oriented
mutual funds on non-
delivery basis
Seller 0.025%
sale of derivatives
reorganized stock
exchange
Seller 0.017%
Sale of units of equity
oriented mutual funds
to the mutual fund
Seller 0.25%
There are two types of investment in Mutual Funds.
Lump Sum
Systematic Investment Plan(SIP)
.
Lump sum: In Lump sum the investment is only one times that
is of Rs. 5,000. and if the investment is monthly then the investment will be 6,000/-.
Systematic Investment Plan(SIP) :
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We have already mentioned about SIPs in brief in the previous pages but now going into
details, we will see how the power of compounding could benefit us. In such case, every
small amounts invested regularly can grow substantially. SIP gives a clear picture of how
an early and regular investment can help the investor in wealth creation. Due to its
unlimited advantages SIP could be redefined as “a methodology of fund investing regularly
to benefit regularly from the stock market volatility. In the later sections we will see how
returns generated from some of the SIPs have outperformed their benchmark. But before
moving on to that lets have a look at some of the top performing SIPs and their return for 1
year:
Scheme
Amoun
t NAV
NAV
Date
Total
Amount
Reliance diversified
power sector retail 1000 62.74 30/5/2008 14524.07
Reliance regular savings
equity 1000 22.208 30/5/2008 13584.944
principal global
opportunities fund 1000 18.86 30/5/2008 14247.728
DWS investment
opportunities fund 1000 35.31 30/5/2008 13791.157
BOB growth fund 1000 42.14 30/5/2008 13769.152
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In the above chart, we can see how if we start investing Rs.1000 per month then what
return we’ll get for the total investment of Rs. 12000. There is reliance diversified power
sector retail giving the maximum returns of Rs. 2524.07 per year which comes to 21%
roughly. Next we can see if anybody would have undertaken the SIP in Principal would
have got returns of app. 18%. We can see reliance regular savings equity, DWS investment
opportunities and BOB growth fund giving returns of 13.20%, 14.92%, and 14.74%
respectively which is greater than any other monthly investment options. Thus we can
easily make out how SIP is beneficial for us. Its hassle free, it forces the investors to save
and get them into the habit of saving. Also paying a small amount of Rs. 1000 is easy and
convenient for them, thus putting no pressure on their pockets.
Now we will analyze some of the equity fund SIP s of Birla Sunlife with BSE 200 and
bank fixed deposits In a tabular format as well as graphical.
Exposure of Mutual Funds Companies in India
The concept of mutual funds in India dates back to the year 1963. The era between 1963
and 1987 marked the existence of only one mutual fund company in India with Rs. 67bn
assets under management (AUM), by the end of its monopoly era, the Unit Trust of India
(UTI). By the end of the 80s decade, few other mutual fund companies in India took their
position in mutual fund market.
The new entries of mutual fund companies in India were SBI Mutual Fund, Canbank
Mutual Fund, Punjab National Bank Mutual Fund, Indian Bank Mutual Fund, Bank of
India Mutual Fund.
The succeeding decade showed a new horizon in Indian mutual fund industry. By the end
of 1993, the total AUM of the industry was Rs. 470.04 bn. The private sector funds started
penetrating the fund families. In the same year the first Mutual Fund Regulations came into
existence with re-registering all mutual funds except UTI. The regulations were further
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given a revised shape in 1996.
Kothari Pioneer was the first private sector mutual fund company in India which has now
merged with Franklin Templeton. Just after ten years with private sector players
penetration, the total assets rose up to Rs. 1218.05 bn. Today there are 33 mutual fund
companies in India in which some are as below.
ABN AMRO Mutual Funds
Birla Sun life mutual Funds
Bank of Baroda Mutual Fund
HDFC Mutual Fund
HSBC Mutual Fund
ING Vysya Mutual Fund
Prudential ICICI Mutual Fund
Sahara Mutual Fund
State Bank of India Mutual Fund
Tata Mutual Fund (TMF)
Kotak Mahindra Asset Management Company (KMAMC)
UTI Asset Management Company Private Limited
Reliance Mutual Fund (RMF)
Standard Chartered Mutual Fund
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Escorts Mutual Fund
Alliance Capital Mutual Fund
Benchmark Mutual Fund
Canbank Mutual Fund
Chola Mutual Fund
LIC Mutual Fund
GIC Mutual Fund
Working of a Mutual Fund
Terms and conditions
This facility offered only to the investors having bank accounts in selected cities
which are specific in the form of the SIP.
Submit the following document at least 21 working days before the first SIP date for
ECS (Electronic clearing Service).
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The first SIP cheque should be issued from the same bank account which is to be
debited under ECS for subsequent installments.
The bank account provided for ECS (Debit) should participate in local MICR
clearing.
SIP auto debit facility is available only on specific dates of the month i.e. 2 nd or 10th
or 18th or 28th.
The investor agrees to abide by the terms and conditions of ECS facility of Reserve
bank of India.
An investor can opt for monthly or quarterly frequency.
Only one SIP per month or per quarter is permitted per folio/account.
Minimum investment amount – monthly SIP option – 60 installments of Rs. 100/-
each or 12 installment or Rs. 500/- each or 6 installments of Rs. 1000/- each and in
multiples of Re.1/- thereafter.
The gap between the 1st cheque/ installment & the 2nd cheque / installment should be
at least 21working days. However subsequent cheques should have a gap of at least
a month or a quarter depending upon the frequency chosen.
Advantages of Mutual Funds
Diversification: The best mutual funds design their portfolios so individual
investments will react differently to the same economic conditions. For example,
economic conditions like a rise in interest rates may cause certain securities in a
diversified portfolio to decrease in value. Other securities in the portfolio will
respond to the same economic conditions by increasing in value. When a portfolio is
balanced in this way, the value of the overall portfolio should gradually increase
over time, even if some securities lose value.
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Professional Management: Most mutual funds pay topflight professionals to
manage their investments. These managers decide what securities the fund will buy
and sell.
Regulatory oversight: Mutual funds are subject to many government regulations that
protect investors from fraud.
Liquidity: It's easy to get your money out of a mutual fund. Write a check, make a
call, and you've got the cash.
Convenience: You can usually buy mutual fund shares by mail, phone, or over the
Internet.
Low cost: Mutual fund expenses are often no more than 1.5 percent of your
investment. Expenses for Index Funds are less than that, because index funds are not
actively managed. Instead, they automatically buy stock in companies that are listed
on a specific index
Transparency
Flexibility
Choice of schemes
Tax benefits
Well regulated
Drawbacks of Mutual Funds
Mutual funds have their drawbacks and may not be for everyone:
No Guarantees: No investment is risk free. If the entire stock market declines in
value, the value of mutual fund shares will go down as well, no matter how balanced
the portfolio. Investors encounter fewer risks when they invest in mutual funds than
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when they buy and sell stocks on their own. However, anyone who invests through a
mutual fund runs the risk of losing money.
Fees and commissions: All funds charge administrative fees to cover their day-to-
day expenses. Some funds also charge, financial consultants, or financial planners.
Even if you don't use a broker or other financial adviser, you will pay a sales
commission if you buy shares in a Load Fund.
Taxes: During a typical year, most actively managed mutual funds sell anywhere
from 20 to 70 percent of the securities in their portfolios. If your fund makes a profit
on its sales, you will pay taxes on the income you receive, even if you reinvest the
money you made.
Management risk: When you invest in a mutual fund, you depend on the fund's
manager to make the right decisions regarding the fund's portfolio. If the manager
does not perform as well as you had hoped, you might not make as much money on
your investment as you expected. you invest in Index Funds, you forego
management risk, because these funds do not employ managers
CHAPTER 3:-
Project Profile And Unit Linked Plans Of Reliance Capital
RESEARCH MEATHODOLOGY
o significancce of the study
o Objective And Scope Of The Study
o Hypothesis
Page 52 of 83
o Sample size and type
o Questionnaire
o Statistical tool
ULIP PLANS
1-RELIANCE AUTOMATIC INVESTMENT PLAN:-
Key Features Reliance Automatic Investment Plan
Two plan option to choose from ready- made and tailor- made.
Freedom to decide your own fund mix based on your risk
Profile under the tailor-made plane
Regular ,limited , single premium paying option
Unmatched flexibility through our exchange option
Liquidity in the form of partial withdrawal
The Key Benifits Of Reliance Automatic Investment Plan Are As Follows
A smart plan which adapts to your changing risk profile with increasing age.
Option to lower the average cost of unit through systematic transfer of your fund.
Flexibility to switch between fund and plan.
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Option for additional insurance cover available through riders.
How Does This Plan Work
As a customer you have the liberty to choose between the ready made and tailor-
made plan option . The premium contributions made by you, net of premium
allocation charges and sum assured related charges are invested in fund of your
choose and unit are allocated depending on the price of unit for the fund
The fund value is the total value of units that you hold in the fund. The mortality
charges and policy administration charges are deducted through cancellation of
units, whereas the fund management charge is priced in the units value.
TAX BENIFITE
As per current tax rules premium paid are eligible for tax deduction under sec.80c
of the income tax act,1961. Provided the premium in any years during the term of
the policy does not exceed 20% of the sum assured, maturity and withdrawals are
eligible for tax benefit under sec.10(10d). Death benefits are tax free under
Page 54 of 83
sec.10(10)d of the income tax act,1961. Under sec 80c premiums up to rs.100,000
are allowanced as deduction from your taxable income.
who can buy this product ?
reliance automatic investment plan
Minimum age at entry: 18 years last birthday
Maximum age at entry: 59 years last birthday
Minimum age at vesting : 45 years last birthday
Maximum age at vesting : 64 years last birthday
Minimum policy term: 5 years or up to age 45 years, if later
minimum sum assured : 5 times of the annualised premium
Maximum sum assured : 50times of the annualised premium
2- RELIANCE SUPER INVESTASSURE PLAN
KEY FETURE – RELIANCE INVESTASSURE PLAN
Page 55 of 83
Twin benefits of marke linked return and insurance protection
Investment opportunity with flexibility – choose from 8 pure investment fund option
Option to pay top up premium's
Liquidity in the form of partial withdrawals
A host of optional rider benefits to enhance protection cover
How does the reliance super investassure plan ?
As a customer you have the liberty to choose between 8 fund options the premium
contribution made by you, net of premium allocation charges ae invested in fund of
your choice. The units are allocated depending on the price of units of the funds.
The fund value is the total value of units that u hold across all the unit-linked funds.
Minimum Sun Assured: Annualized Premium Payable For 5 Years.
Maximum Sum Assured : Depends On The Age At Entry
age at entry (last birthday) maximum sum assured
0 to 40 20 times of annualized premium
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41 to 45 15 times of annualized premium
46 to 50 10 times of annualized premium
51 to 60 5 times of annualized premium
BENEFITS
LIFE COVER BENEFITS
if death of the life assured occur before commencement of risk cover#,
total fund value as on the date of intimation of death will be paid.
if death of the life assured occurs on or after 60th birthday, the higher of 1or
2 will be paid
1. sum assure( less all partial withdrawals made from the policy fund
during the 24 months before attaining 60th birthday withdrawals made
from the basic policy fund after attaining 60th birthday)
2. total fund value as the date of intimation of death.
MATURITY BENIFIT
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on survival of the life assured to maturity, the total fund value will be paid. the
policy terminates on payment of maturity benefits .
RIDER BENEFITS
you can add following optional rider benefits
reliance major surgical benefit rider
reliance critical conditions(25) rider
reliance term life insurance term benefits
reliance accidental death and total and permanent disablement rider
RESEARCH METHODOLOGY
Research Methodology deals with, the procedure adopted to carry out the study.
According to green and Tull:
“A research design is the specification of methods and procedures acquiring the
information needed It is the overall operational pattern or framework of the project that
Page 58 of 83
stipulates which information is to be collected from which sources by what procedures’’.
For conducting the study, the researcher has adopted both primary as secondary method of
data collection.
Data sources:
Research is totally based on primary data. Secondary data can be used only for
the reference. Research has been done by primary data collection, and primary
data has been collected by interacting with various people.
CHAPTER 5
DATA ANALYSIS & INTERPRETATION
Q 1. Do you make investments?
Page 59 of 83
CATEGORY NO.OF PEOPLES %
YES 22 73
NO 8 27
For conducting the study, the researcher has adopted both primary as secondary method of
data collection.There are 73% of the value of people stand with yes,and then 23%of the
people says no.
Q 2. What are the reasons to make investments?
OPTION PEOPLE %
TAX SAVING 7 23.33333
SECURE
INVESTMENT
6
20
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LIFE COVER 9 30
RETURN 5 16.66667
OTHER 3 10
Research is totally based on primary data. Secondary data can be used only for
the reference. Research has been done by primary data collection, and primary
data.30%of them are with life cover.
3. Which company’s policy you are having?
COMPANIES PEOPLE %
LIC 18 61
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Reliance 4 8
Icici 3 7
OTHER 5 11
Research is totally based on primary data. Secondary data can be used only for
the reference. Research has been done by primary data collection, and primary
data 61% of the lic and the rest of the with the other people.
Page 62 of 83
PEOPLE
61%8%
7%
11%13%
LICRelianceIIciciOTHER
Q.4 Are you satisfied with your Investment?
CATEGORIES NO. OF PEPOLE %
YES 16 58
NO 14 42
NO. OF PEPOLE
58%
42%
YES
NO
Research is totally based on primary data. Secondary data can be used only for
the reference. Research has been done by primary data collection, and primary
data and 58% stands with yes and 42% no.
Page 63 of 83
Q5. Have you heard about private insurance company reliance capital?
CATEGORIES NO. OF PEPOLE %
YES 16 58
NO 14 42
NO. OF PEPOLE
58%
42%
YES
NO
Interpretatiom
Research is totally based on primary data. Secondary data can be used only for
the reference. Research has been done by primary data collection, and primary
data and 58% stands with yes and 42% no.
Page 64 of 83
Q6. How did you come to know about the company.
CATEGORIES NO. OF PEPOLE %
ADVERTISEMENT 12 40
WORD OF MOUTH 8 29
YOUR BANK 3 7
INSURANCE
AGENT
7 24
NO. OF PEPOLE
40%
29%
7%
24%
ADVERTISEMENT
WORD OF MOUTH
YOUR BANK
INSURANCE AGENT
Page 65 of 83
Q7.what kind of plan do you have?
CATEGORIES NO.OF PEPOLE TOTAL%
ENDOWNMENT 6 19
TERM 4 11
ULIP 15 57
NO POLICY
HOLDER
5 13
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NO.OF PEPOLE
19%
11%
57%
13%
ENDOWNMENT
TERM
ULIP
NO POLICY HOLDER
Q8 Are you satisfied with your Investment?
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CATEGORIES NO. OF PEOPLE %
SATISFIED 16 56
UNSATISFIED 9 31
NO POLICY
HOLDER
5 13
NO. OF PEOPLE
56%31%
13%
SATISFIED
UNSATISFIED
NO POLICY HOLDER
Q9.Are you aware about the benefit and the condition about your plan?
CATEGORIES NO. OF PEPOLE %
COMPLETE
AWARE
8 23
ADEQUATE AWARE 5 17
CONFUSE 2 13
LESS KNOWLEDGE 7 19
COMPLETE 4 15
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UNAWARE
NO POLICY
HOLDER
2 13
NO. OF PEPOLE
23%
17%
13%19%
15%
13% COMPLETE AWARE
ADEQUATE AWARE
CONFUSE
LESS KNOWLEDGE
COMPLETE UNAWARE
NO POLICY HOLDER
Q10 How much return you are expecting from your ULIP?
CATEGORIOES NO OF PEPOLE %
15-25% 30 20
25-35% 32 21
35-45% 28 19
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MORE THAN 45% 40 27
NON POLICY
HOLDER
20 13
NO OF PEPOLE
20%
21%
19%
27%
13%15-25%
25-35%
35-45%
MORE THAN 45%
NON POLICY HOLDER
Q11 Do you know about the reliance automatic investment plan
of ULIP?
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CATEGORIES NO.OF PEPOLE %
YES 17 59
NO 13 41
NO.OF PEPOLE
59%
41%
YES
NO
Q12. Do you think reliance automatic investment plan
of reliance capital is better other plans?
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CATEGORIES NO.OF PEPOLE %
YES 10 33
NO 7 26
DON’T KNOW 13 41
NO.OF PEPOLE
33%
26%
41%YES
NO
DON’T KNOW
Q13. why did you purchase insurance plan?
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CATEGORIES NO. OF PEPOLE %
FOR PROTECTION 4 15
FOR SAVING 6 21
FOR INVESTMENT 11 35
FOR TAX SAVING 8 29
NO. OF PEPOLE
15%
21%
35%
29%FOR PROTECTION
FOR SAVING
FOR INVESTMENT
FOR TAX SAVING
Page 73 of 83
Q14 Do you think ULIP is a risky investment?
CATEGORIES NO.OF PEPOLE %
VERY RISKY 4 13
MODERATE 5 18
SAFE 10 34
VERY SAFE 6 20
NON POLICY
HOLDER
7 15
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NO.OF PEPOLE
13%
18%
34%
20%
15%VERY RISKY
MODERATE
SAFE
VERY SAFE
NON POLICY HOLDER
CHAPTER 6
FINDING / SUGGESTION
FINDINGS
Now people mainly prefer ULIP for saving, then bank then
Post-Office and after that prefer P.P.F. and other. The main reason behind the
insurance plan or ULIP preference is switching facility or option to choose fund.
Mainly people prefer low growth safe return as compare to high growth
some risky return.
People mainly purchase life insurance policy for investment and then for
tax-saving they give 2nd preference to protection.
Approximately 20% people do not know what is insurance.
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I also find that people mainly prefer L.I.C. as compare to private insurance
company.
In my survey, I also find that only 56% people are satisfied with
current policy.
In also find that only 58% people know about the ICICI Prudential Life
Insurance.
SUGGESTION
Brand awarness about the reliance capital’s ulip plans.
Company preferences should be considered.
After sales service should also be provided by the agents.
Different promotin schemes should be adopte by the company.
Ex- banners, holdings , road shows etc.
They should target rural market as well.
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CHAPTER 7
CONCLUSION
Our exhaustive research in the field of Life Insurance threw up some interesting
trends which can be seen in the above analysis.
A general impression that we gathered during Data collection was the immense
awareness and knowledge among people about various companies and their
insurance products.
People in general have been impression by the marketing and advertising campaigns
of insurance companies.
A high penetration of print,radio and television ad campains over the years is
beinning to have it’s impact now.
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The general satisfaction levels among public with regards to policy and agents still
requires improvement. But therein lays the opportunity for a relative new comer like
ING. LIC has never been known for prompt service or customer oriented methods
and Reliance can build on these factors.
ANEXXURE
QUESTIONNAIRE
Q 1. Do you make investments?
Yes ( ) No ( )
Q 2. What are the reasons to make investments?
Tax Saving ( ) Return ( )
Capital Appreciation ( )
secure investment ( )
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Life cover ( )
Other ( )
Q 3 If Yes, which company's policy you are having?
Reliance ( ) Lic ( )
icici ( ) other ( )
Q4. Are you satisfied with your Investment?
YES ( ) NO ( )
Q 5. Is private life insurance companies reliable for Investment?
Yes ( ) No ( )
Q 6. Have you heard about private insurance company reliance capital?
Yes ( ) No ( )
Q 7. From where did you come to know about reliance capital?
Electronic media ( ) print media ( )
Seminar ( ) Work shops ( )
Advisor ( ) others ( )
Q8 Are you aware about the benefit and the condition about your plan?
COMPLETE AWARE ( )
ADEQUATE AWARE ( )
CONFUSE ( )
LESS KNOWLEDGE ( )
COMPLETE UNAWARE ( )
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NO POLICY HOLDER ( )
Q 9. a) Have you ever invested in ULIP plans?
Yes ( ) No ( )
b) If Yes, please specify: -
PLAN NAME :
saving plan ( ) protection plan ( )
Pension plan( ) children’ s plan ( )
Q 10. What are the reason for investment in ulip
Life protection ( )
Investment and Savings ( )
Flexibility ( ) Transparency ( )
Q 11. which company policy do you have?
ICICI Prudential ( )
HDFC Standard ( )
Bajaj Allianz ( )
Reliance life insurance ( )
Lic ( ) Other ………………………………...
Q12. How much return you are expecting from your ULIP?
15-25%
25-35%
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35-45%
ABOVE THAN
Q13. Do you think ULIP is a risky investment?
VERY RISKY
LESS RISKY
SAFE
VERY SAFE
Q 14. Do you have any plan to buy ulip plans in near future?
Yes ( ) No ( )
Q 15. If you are not taking any ulip plans, please tell us the reasons why?
We couldn’t afford ( )
We don’t see any benefit with the system. ( )
We don’t want insurance. ( )
We don’t understand how ulip works. ( )
We are not too much aware of ulip plans. ( )
Q 16. What steps do you suggested to the companies to make their ULIP plans
more popular?
Give more advertisements. ( )
Arrange more work shops. ( )
Arrange more seminars ( )
Reduce charges ( )
Create awareness through advisors ( )
Others ………………………………………..
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17. Personal Details
NAME-------------------------AGE------------------------------------
QUALIFICATION----------------------------------------------------
OCCUPATION---------------------------------------------------------
ADDRESS------------------------------------------------------------------------------------------------
-------------------------------------------
BIBLIOGRAPHY
1. BOOKS/MAGAZINES REFFERED:
STUDY GUIDE- PRINCILES & PRACTICES OF LIFE /
GENERALINSURANCE, by AIMA.
MISHRA M.N. - INSURANCE PRINCIPLE & PRACTICE (SULTAN CHAND
& COMPANY LTD., NEW DELHI)
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SRIVASTAVA D.C., SRIVASTAVA SHASHANK - INDIAN INSURANCE
INDUSTRY TRANSITION & PROSPECTS (NEW CENTURY
2. WEBSITES REFFERED:
www.reliancelife.co.in
www.cifainsurance.com
www.insurance.ind.com
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