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OM KOTHARI INSTITUTE OF MANAGEMENT

& TECHNOLOGY , KOTA


(Affiliated to University of Kota, Recognized by AICTE)

TRAINING PROJECT REPORT


ON

Platinum plus plan and its comparison

Submitted in partial fulfillment of the requirement for the


Award of Degree of

Bachelor of Business Administration


From University of Kota, Kota {RAJ.}
Academic Session 2011-2012

Project Guide: Submitted By:


Mr. prateek gupta kapil soni
Faculty, OKIMT, Kota BBA-3rd year
OM KOTHARI INSTITUTE OF MANAGEMENT &
TECHNOLOGY

(Affiliated to University of Kota, Kota, Approved by All-India Council for


Technical Education-Government of India and Sponsored by Om Kothari
Foundation, Kota)

CERTIFICATE

This is to certify that kapil soni student of BBA 3rd Year at Om Kothari
Institute of Management and Technology , has completed Tanning Project
Report entitled Platinum plus plan and its comparison
The project has been completed after study for one year in BBA course and
for partially fulfilling the requirements for award of degree of Bachelor of
Business Administration of University of Kota, Kota.

The Tanning Project Report has been completed under the guidance of Mr.
pradeep gupta of OKIMT and is as per norms and guidelines provided.

Principal Academic Guide

Mr. prateek gupta

A-1, Special I.P.I.A. Jhalawar Road, Kota-324005


: 0744-2490878, 2490402, E-mail: oki_mr@rediffmail.com
Fax : 0744-2438069
OM KOTHARI INSTITUTE OF MANAGEMENT &
TECHNOLOGY
(Affiliated to University of Kota, Kota, Approved by All-India Council for
Technical Education-Government of India and Sponsored by Om Kothari
Foundation, Kota)

CERTIFICATE
This is to certify that kapil soni a student of BBA 3rd Year at Om Kothari
Institute of Management and Technology, has completed Training Project
Report entitled Platinum plus plan and its comparison

The project has been completed after study for one year in BBA course and for
partially fulfilling the requirements for award of degree of Bachelor of Business
Administration of University of Kota, Kota.

The Training Project Report has been evaluated and viva-versa conducted by
the undersigned panel of examiners. The project has been found
satisfactory/unsatisfactory and is recommended/not recommended for
acceptance.

Prof. Prof.
Internal Examiner External examiner

Kota

Date:

A-1, Special I.P.I.A. Jhalawar Road, Kota-324005


: 0744-2490878, 2490402, E-mail: oki_mr@rediffmail.com
Fax : 0744-2438069
PREFACE

Bachelor of business administration (BBA) is one of the most reputed professional


courses in the field of Management. This course Includes both theory & application
part of the two required to undergo practical training in an Organization. Summer
training is an exercise by means of which student learn a lot of things which cant be
taught in the classroom. During summer training students come to know about the
principles & Practices of management application in the real working conditions in an
Organization. After completion of first year students are required to undergo summer
training for twelve weeks.

The project study at affective analysis of recruitment of financial


consultant was carried quite in of the concern Platinum plus plan and
its comparison through me. The project is consists of description of the
concept of plan[ platinum plus ], its procedure, its sources, objectives etc. In
this project we also apply research methodology. The interpretation &
analysis of the questionnaire gives the final result & Conclusion.
Acknowledgement

Its great privilege & honor to have an opportunity to undertake summer


training at Birla sunlife,kota

I pay my sincere thanks to BSLI for giving me this opportunity to work


with Platinum plus plan and its comparis on for guiding me through
the whole 12 weeks training period.

I am grateful for providing me lot of marketing tools the training period & in
completion of my project despite their pre-occupation with their work.

Its really very difficult to express feelings about BSLI staff for their help and
support. I am thankful to our colleagues for supporting helps me in my
work..

I am also independent all our faculty members for their valuable suggestion and
encouragement they give me whenever I required.

Submitted By
DATE: kapil soni
PLACE: BBA-3rd year
EXECUTIVE SUMMARY

Being a management trainee at BSLI for 3 months aim and wishes were to learn about
the different product of BSLI and experiences the concept of investment

The project file inculdes the conceptual framework of company in which the brief
history of company has been described.

I have taken the experience of plans deeply and have given the best performance i.e.
upto 10 new clients

And the project profile also includes the research methodology in which the research
database has been given.

And at last I have given some interpretation ,conclusions & some suggestion to the
project .Hence it is the brief executive summary of Project.

Really the experience of plans is so much interesting.


DECLARATION

I hereby declare that the present report entitled Platinum plus plan and
its comparison is based on my original work and indebtedness to other
work / publication has been duly acknowledged at relevant places.

Date: Submitted by: -


Place: kapil soni
BBA-3rd year
TABLE OF CONTENTS

CERTIFICATES
PREFACE
ACKNOWLEDGEMENT

EXECUTIVE SUMMARY
DECLARATION

CHAPTER 1 COMPANY PROFILE

CHAPTER 2 PROJECT PROFILE

CHAPTER 3 RESEARCH METHODOLOGY

CHAPTER 4 ANALYSIS & INTERPRETATION

CHAPTER 5 INFERENCES & CONCLUSION

CHAPTER 6 SUGGESTION & RECOMMENDATION

BIBLIOGRAPHY
QUESTIONNAIRE
COMPANY

PROFILE
Introduction

Introduction:-

The purpose of the project is to know about the market for Birla Sun Life

Insurace Company. Birla Sun Life Insurace Company is growing very fast. In

March month Birla Sun Life Insurace Company has maximum business from its

competitors.

In future life insurance sector going to give thousands of vacancies to the students

so there is lots of opportunities for MANAGEMENT student. Students have to

give their full efforts or 100% target in their summer internship program for

getting good placements in life insurance sector.


Objectives:-

The prime objective of the study was to understand the market and analysis the
competitors.

The survey was used to

Understand the type of Life Insurance Policies desired by the customer.

To find out the degree of awareness of life Insurance.

To study the consumer behavior.

To find out the market potential for life Insurance Policies in Kota.

To learn professionalism in market of financial product and services.

To find prospects for the institution.

To conduct the survey to know how many persons have Life Insurance Policies
or how many dont have.
Company profile: Birla sunlife
Established in 2000, Birla sun Life Insurance Company Limited (BSLI) is a joint venture
between the Aditya Birla Group, a well known and trusted name globally amongst Indian

conglomerates and Sun Life Financial Inc, leading international financial services

organization from Canada. The local knowledge of the Aditya Birla Group combined with

the domain expertise of Sun Life Financial Inc., offers a formidable protection for its

customers future.

With an experience of over 9 years, BSLI has contributed significantly to the growth and

development of the life insurance industry in India and currently ranks amongst the top 5

private life insurance companies in the country.

Known for its innovation and creating industry benchmarks, BSLI has several firsts to its

credit. It was the first Indian Insurance Company to introduce Free Look Period and the

same was made mandatory by IRDA for all other life insurance companies. Additionally,

BSLI pioneered the launch of Unit Linked Life Insurance plans amongst the private players

in India. To establish credibility and further transparency, BSLI also enjoys the prestige to

be the originator of practice to disclose portfolio on monthly basis. These category

development initiatives have helped BSLI be closer to its policy holders expectations,

which gets further accentuated by the complete bouquet of insurance products (viz. pure

term plan, life stage products, health plan and retirement plan) that the company offers.
Add to this, the extensive reach through its network of 600 branches and 1,75,000

empanelled advisors. This impressive combination of domain expertise, product range,

reach and ears on ground, helped BSLI cover more than 2 million lives since it commenced

operations and establish a customer base spread across more than 1500 towns and cities in

India. To ensure that our customers have an impeccable experience, BSLI has ensured that

it has lowest outstanding claims ratio of 0.00% for FY 2008-09. Additionally, BSLI has the

best Turn Around Time according to LOMA on all claims Parameters. Such services are

well supported by sound financials that the Company has. The AUM of BSLI stood at Rs.

8165 crs as on February 28, 2009, while as on March 31, 2009, the company has a robust

capital base of Rs. 2000 crs.

Sun Life Financial is a leading international financial services organisation

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 December 31,

2008, the Sun Life Financial group of companies had total assets under

management of $381 billion


About Aditya Birla Group:-

A US $28 billion corporation, the Aditya Birla Group is in the league of Fortune 500.

It is anchored by an extraordinary force of 130,000 employees, belonging to 30

different nationalities. In India, 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. Over 50 per cent of its revenues flow from its overseas

operations.

The Group operates in 25 countries India, UK, Germany, Hungary, Brazil, Italy,

France, Luxembourg, Switzerland, Australia, USA, Canada, Egypt, China, Thailand,

Laos, Indonesia, Philippines, Dubai, Singapore, Myanmar, Bangladesh, Vietnam,

Malaysia and Korea.

Globally the Aditya Birla Group is:-

A metals powerhouse, among the world's most cost-efficient aluminium and

copper producers. Hindalco-Novelis is the largest aluminium rolling company. It

is one of the three biggest producers of primary aluminium in Asia, with the

largest single location copper smelter No.1 in viscose staple fibre.


The fourth largest producer of insulators.
The fourth largest producer of carbon black.
The 11th largest cement producer globally, the seventh largest in Asia and the

second largest in India.


Among the world's top 15 BPO companies and among India's top four
Among the best energy efficient fertiliser plants

In India:-

A premier branded garments player


The second largest player in viscose filament yarn
The second largest in the chlor-alkali sector
Among the top five mobile telephony companies
A leading player in life insurance and asset management
Among the top three supermarket chains in the retail business

Rock solid in fundamentals, the Aditya Birla Group nurtures a culture where success

does not come in the way of the need to keep learning afresh, to keep experimenting.

Beyond business the Aditya Birla Group is:-

Working in 3,700 villages


Reaching out to seven million people annually through the Aditya Birla Centre

for Community Initiatives and Rural Development, spearheaded by Mrs.

Rajashree Birla
Focusing on: health care, education, sustainable livelihood, infrastructure and

espousing social causes


Running 42 schools and 18 hospitals
Transcending the conventional barriers of business to send out a message that

"We care".
Board of Directors

Mr. Kumar Mangalam Birla

Chairman, The Aditya Birla Group

OTHER EXECUTIVES:-
Mr. Ajay Srinivasan
Chief Executive Financial Services Aditya Birla Group
Mr. Bishwanath Puranmalka
Director Financial Services Aditya Birla Group

Mr. Donald Stewart


Chief Executive Officer Sun Life Financial

Mr. Venkatesh Mysore


Country Head India Sun Life Financial, Asia

Mr. Stephan Rajotte


President Sun Life Financial, Asia

Mr. Suresh Talwar

Mr. Gian Gupta

PROJECT
PROFILE

Platinum plus

BSLI Platinum Plus


Birla Sun Life Insurance introduces BSLI Platinum Plus Plan with Platinum Plus Fund

IV, which marks a breakthrough in innovation. The launch of this fund sets a

benchmark in the industry as it protects not only your NAV but also its growth. With

Platinum Plus Fund IV, you will enjoy the highest NAV recorded by the fund over the

period th th 15 September, 2009 to 15 December, 2016. Guaranteed.

Guarantee of highest NAV in 7 years


Investing in BSLI Platinum Plus Plan helps you participate in the equity markets

through the Platinum Plus Fund IV. You are guaranteed the highest NAV recorded by

the fund over the seven year period th th 15 September, 2009 to 15 December, 2016.

Let's understand how it works. Due to the sophisticated investment techniques we

employ in managing the Platinum Plus Fund IV, your premiums (net of premium

allocation charges) are used to purchase units in Platinum Plus Fund IV. Thus you will

be allocated units based on the unit price of the fund prevailing on that day.

Thereon the highest NAV ever recorded over 7 years on a day-to-day basis is your

Guaranteed Maturity Unit Price. The Guaranteed Maturity Unit Price starts at Rs. 10

on the first business day, which is 15 th September, 2009. Till 15 December 2016, the

Guaranteed Maturity Unit Price is increased on subsequent business days to the then

prevailing unit price of Platinum Plus Fund IV, if higher.

To participate in the fund, you must ensure that your application is th made on or

before 15 December, 2009.

Participation at just Rs.10,000 per month

You may pay your policy premiums annually, half-yearly, quarterly or monthly. This is

subject to a minimum instalment premium of Rs. 50,000 for yearly, Rs. 25,000 for

half-yearly, Rs. 15,000 for quarterly, or Rs. 10,000 per month. For the monthly

payment option, you require to pay 3 monthly instalments at the time of issue of the

policy.
100% liquidity after 3 years

On completion of 3 years, you can opt for complete liquidation of your plan. You

can withdraw the entire amount without any charges or penalties. This means

you remain in control of your money and use it as and when you need to.

More benefits

Maturity Benefit:At maturity, you will receive the fund value. In addition, we

will pay an amount equivalent to the number of units multiplied by the excess, if

any, of the guaranteed maturity unit price and the unit price at the time of

maturity.

Plan Summary

Entry Age 18 to 70 years

Minimum Annual Rs. 50,000


Premium

Mode of Premium You can pay your policy premiums annually, half-
Payment yearly, quarterly or monthly, subject to a minimum
instalment premium of:
- Rs. 50,000 per annum
- Rs. 25,000 half-yearly
- Rs. 15,000 quarterly; or
- Rs. 10,000 per month (3 monthly instalments
required at issue)

Minimum Sum Assured 5 x Annual Premiums

Policy Surrender and After completion of 3 years, you can surrender


Charges policy to us and receive 100% of fund value. If
policy is surrendered before completion of 3 years,
surrender charges will be 16%, 13% and 10% of st
nd rd the premium in 1 , 2 and 3 year respectively.
This charge is guaranteed to never increase.

Tax Benefits Under Section 80C and 10(10D) of the Income Tax
Act, 1961

Partial Withdrawals You can make partial withdrawal after completing 3


policy years. Minimum withdrawal: Rs. 5000.

Maximum Withdrawal: Fund value less Rs. 30,000.

No charges for partial withdraw

Single premium, unit-linked insurance plans (SP Ulips) from life insurers have been

the preferred flavour for a lot of people who invest through insurance. Their main

draw is the tax break under Section 80C of the Income tax Act, 1961. For many, they

have filled the void left by the Life Insurance Corporations popular fixed-return,

single-premium plan, Bima Nivesh.

However, there have been quite a few additions to the universe of financial

instruments in recent times, and equity-linked savings schemes (ELSS) are one of

them. They, too, give tax breaks and allow lump sum investment. So how do they

stack up against SP Ulips?


The Ulip option. A Ulip packages a life cover with investment in units similar to

mutual funds (MFs). So, while part of your premium pays the administration charge,

the rest is invested in assets like equities or debt, depending on your choice.

Going by the way you pay your premiums, Ulips can be of two types. The first is the

regular premium paying option, where you pay a fixed amount every year (monthly,

quarterly, half-yearly or annually) for at least the first three years of the policy. The

second is the SP Ulip, where you have to pay a lump sum just once.

If you choose the regular premium option, in the first three years, the cost you have to

bear is about 60 per cent of the premium you pay. Alternatively, if you buy SP Ulips

for three consecutive years, it would cost you around 10 per cent of the premium you

pay every year. So, the SP Ulip is the obvious choice among the two.

The ELSS option. An ELSS is a diversified equity mutual fund scheme. You can

make a one-time investment.

The similarities. For both SP Ulips and ELSS, you have to invest once and the

investment is locked in for three years. Under the present tax laws, what you get on

maturity is tax-free. While in ELSS your entire investment will be in equity, SP Ulips

give you the choice of investing in equity or debt instruments, or both, and the choice

to move from one to the other.

The differences. The biggest difference is that SP Ulips give you a life cover, while

ELSS does not. So the mortality cost of insuring your life is deducted from the value
of the fund every month. When the plan matures, the value of the units, or fund value,

is yours. If a policyholder dies during the plan term, the higher of sum assured or fund

value is paid to the beneficiary. However, some plans like Met Smart Premier of

MetLife Insurance and Bajaj Allianz UnitGain Guarantee SP pay out both, albeit at a

higher cost.

The tax laws. According to the Insurance Regulatory and Development Authority

(Irda), the life cover of a SP Ulip has to be at least 125 per cent of the premium. But

under I-T rules, if the premium paid for a policy is more than 20 per cent of the sum

assured in a year, then deduction from taxable income will be allowed only up to 20

per cent of the sum assured. In other words, to get the entire premium deducted from

taxable income under Section 80C, make sure the cover is at least five times the

premium.

The costs. In an ELSS, the amount invested is subjected to only two charges. One is

the entry cost or the load, which is normally 2.25 per cent of the amount invested.

After the units are allotted, there are recurring charges also called the expense ratio.

For ELSS, the average is around 2.25 per cent of the fund value, while the maximum

permitted is 2.5 per cent.

For SP Ulips, first there is the premium allocation charge. Akin to the entry load for an

ELSS, it ranges from 2 to 4.5 per cent for amounts below Rs 1 lakh, and goes down

for higher amounts. Then there is fund management cost, which is similar to the MF

recurring expense ratio.


Further, there is the mortality cost, which is based on the difference between the sum

assured and the value of the fund. Some SP Ulips also carry a surrender charge for

exiting the plan in the fourth and fifth years as well. Then there is the policy

administration charge. It is deducted from the fund value either as a percentage, a

fixed sum every month, often based on the sum assured.

Irrespective of how the charges come in, the post-charges returns from most SP Ulips

is below that from the ELSS funds for lower amounts. Lower front-end costs often

come with higher mortality rates and policy administration charges, and so on.

The returns. Since both SP Ulips and ELSS have a three-year lock in, to compare

them, one should look at their three-year returns. However, since many of the SP Ulips

have been operating for less than three years, we have considered their last one-year

performance.

Of the 29 open-ended ELSS plans in the market today, the average return as on 16

April 2007 has been 3.90 per cent over the last one-year. Funds like Can Equity Tax

Saver and Prudential ICICI Tax Plan have delivered negative returns of 21.89 per cent

and 8.64 per cent, respectively, against the Sensex return of 18.74 per cent during the

same period. While none has managed to beat the benchmark Sensex, six funds have
managed double-digit returns with Fidelity Tax Advantage delivering highest return of

18.03 per cent.

The 10 SP Ulip plans in operation for the last year have given average returns of 12.2

per cent. While none of them have given a negative return, individual returns are

between 6.55 per cent and 15.01 per cent. Over five years, the benchmark Sensex has

given returns of 32.01 per cent and out of 17 ELSS funds in existence since five years,

only four have underperformed the Sensex. The SBI Magnum Tax Gain Scheme 93

has delivered a compounded annualised return of 55.10 per cent. Meanwhile, ICICI

Prudentials Life Link, a SP Ulip, an early entrant, has just managed to beat the

benchmark by delivering compounded annualised return of 32.92 per cent over the

same five-year period.

The decision. Given the cost structures and the return rates over the last few years,

ELSS emerges as the better option if you are looking purely at saving taxes through

investment. (In fact, if you need insurance you can buy a pure term life cover, which is

usually quite cheap.)

Costs in the MF industry are standardised, but not in insurance. So, for SP Ulips, there

are more charges and different companies factor them in differently. So it is tougher to

compare the nature of their impact on the investible part of your premium. Eventually,

the price of a SP Ulip works out higher than ELSS.


But then, all ELSS schemes do not perform equally well. So you will have to choose

based on factors like risk-adjusted returns. (See: Best Funds 2007, 30 April).

An SP Ulip may make sense in the longer term, as the costs are front-loaded. It may

make sense for larger amounts, too, since there would be no entry costs in most cases.

But purely to save taxes, that, by implication, limits investments to Rs 1 lakh, ELSS

will be the way to go till SP Ulips standardise and reduce their costs.

Comparison with other plan

The contents of this Value Research Fund Card (the "Fund Card") published by Value

Research India Private Limited are not intended to serve as professional advice or

guidance and the publisher takes no responsibility or liability, express or implied,

whatsoever for any investment decisions made or taken by the readers of this Fund

Card based on its contents thereof. You are strongly advised to verify the contents
before taking any investment or other decision based on the contents of this Fund

Card. The Fund Card is meant for general reading purposes only and is not meant to

serve as a professional guide for investors. The readers of this Fund Card should

exercise due caution and/or seek independent professional advice before entering into

any commercial or business relationship or making any investment decision or

entering into any financial obligation based on any information, statement or opinion

which is contained, provided or expressed in this Fund Card.

The Fund Card contains information, statements, opinions, statistics and materials that

have been obtained from sources believed to be reliable and the publishers of the Fund

Card have made best efforts to avoid any errors and omissions, however the publishers

of this Fund Card make no guarantees and warranties whatso-ever, express or implied,

regarding the timeliness, completeness, accuracy, adequacy, fullness, functionality

and/or reliability of the information, statistics, statements, opinions and materials

contained and/or expressed in this Fund Card or of the results obtained, direct or

consequential, from the use of such information, statistics,statements, opinions and

materials. The publishers of this Fund Card do not certify and/or endorse any opinions

contained, provided, published or expressed in this Fund Card. All disputes shall be

subject to the jurisdiction of Delhi courts only.

SINCE their launch, Unit Linked Insurance Plans (ULIP) have been a complete

rage; but that's not the case now. This year, thanks to the slowdown, insurers

are seeing lower premium income compared to last year.


So to maintain the spark in ULIPs, insurance companies are trying to entice

buyers by offering guaranteed returns on ULIPs!

How's that possible? Lets decode.

As of now three insurance companies are offering guaranteed ULIPs.

SBI Life Insurance Smart ULIP


Birla Sun Life Insurance Platinum Plus II
Tata AIG Life Insurance InvestAssure Apex

Unlike non-guaranteed ULIPs, these newly launched plans shield you from the

downside of the market by assuring guaranteed returns.

He explains that these plans are like investing in fixed income products that

offer secured returns.

Workings of the plan:

These plans are structured into four phases.

Subscription phase: During this phase, the plan is open for a limited time only.

For instance, SBIs Smart ULIP is open for a period of one year.

Premium paying phase: In this phase, you pay premium only for a fixed term,

which is 3 years. However, SBIs Smart ULIP allows you to choose the

premium paying term for 3 or 5 years.

NAV build-up phase: During this phase, the reset dates, set by the companies

are exercised. Reset dates are pre-decided dates fixed by insurance


companies to record NAVs. Birla Sun Life and Tata AIG record NAV once a

month on the reset date decided by them whereas SBI has two reset dates

every month to record NAV.

These plans have a fixed term of 10 years.

Accumulation phase: The remaining policy term i.e. the tenure left after all the

reset dates have been exercised is the accumulation phase.

Whats unique about guaranteed ULIPs is that they offer the highest Net Asset

Value (NAV) recorded over a given a period of time.

Benefits:

Maturity benefits: On maturity, you get the highest of:

a. The fund value as on date of maturity OR

b. The fund value at the rate of 'highest recorded NAV' OR

c. The starting NAV of Rs 10 per unit

The is highest recorded NAV is the higest NAV among all reset dates.

Death benefits: In case of your untimely death, either fund value or sum

assured will be paid out to your nominee, depending on whichever is higher.

On next page: What to watch out for Illustration: Abhijeet Kini


Read:

Should I withdraw from ULIP?

The various costs involved in your ULIP

What should you watch out for?

1. Charges are more:

When you compare guaranteed ULIPs to single premium or limited premium

paying term plans, the charges on the former are on the higher side. The table

below explains this. It shows the net amount invested at the end of three years

after deducting the policy allocation charges. The sum assured for the plan is

assumed to be Rs 5 lakh and premium Rs 1 lakh.

Charges(%)
SBI Life Birla Sunlife Tata AIG Life

Insurance Insurance Insurance


Policy Platinum Plus InvestAssure
Smart ULIP
year II Apex
Policy term of the
10 years 10 years 10 years
plan
Year 1 15 10 9.5
Year 2 5 4 4
Year 3 5 4 4
Net investment Rs 272,800 Rs Rs 88,060
at the end of 265,800
3 years
Gold Plus
Policy year SBI Elite InvestAssure Plus
II
Policy term of the
10 years 8 years 15-30 years
plan
Year 1 10 8 9.5
Year 2 7 4
Year 3 7 4
Net investment
Rs
at the end of Rs 275,400 Rs 96,750
276,306
3 years

Note: The calculation for Tata AIG has been done taking into account the

charges for 1st year only because InvestAssure Plus is a single premium

product. However, for information purpose, Invest Assure Apex shows figures

for 2nd and 3rd years also.

2. Limited option in hands of investor

These plans don't have a switching option. They also have only one choice of

fund that invests in a mix of debt and equity. An investor is at the mercy of the

fund manager because on one hand, his money is locked in while on the other,

he has not flexibility to switch.

Conclusion:

Harsh Roonga, CEO, Apnapaisa.com says, "If you want to invest in safe

avenues there are better options like public provident fund, bank deposits; why

pay a charge for it."


And anyway, he adds,"Its always better to keep your insurance and

investment needs separate."

As a part of our mission to add more value to our customers through

professional advice and recommendations, we present you a fantastic long

term investment plan which promises good returns in the long term.

Yes, the plan which we are recommending is a ULIP, but this one comes with

fantastic opportunity to really make your money work as hard as you do.

The Plan goes like this:

- You make a regular investment of Rs. 1 Lakh for 3 years. Thats the

premium paying term.

- After Deduction of Charges, the amounts will be invested in high quality

investment avenues.

- Now, it gets interesting hereThe Fund records its NAV for every month

on a particular date, called the reset date till 88 months.

- On Maturity the Fund pays you the units at the highest NAV recorded in

the 88 months.

- On the other hand, The complete money you have invested is guaranteed

to be returned back and is fully secured.


Example:

Suresh invests Rs. 3 Lakhs in Platinum Plus Plan.

The NAV recorded on reset dates in the 88 months moves from Rs. 8 in the

32nd month to 25 in the 65th month and goes down to Rs. 9 in the 88 month.

Now, as per the plan the investor will get the money at an NAV of Rs. 22.

Hence we will get Rs. 7,50,000/- as the maturity amount!!!

Say the NAV remains lower than 10 the entire 88 months [which is a distant

possibility] , then Suresh will be paid complete Rs. 3 Lakhs as the guaranteed

maturity value.

Last Date to invest in this plan is 15th December 2008.

How do they manage to do this?

The Fund uses sophisticated investment techniques we will employ in

managing Platinum Plus. The investment objective is to optimize participation

in an actively managed well diversified portfolio of fundamentally strong blue

chip companies while using debt instruments and derivatives to lock-in capital

appreciations. The use of derivatives will be for hedging purposes only and as

approved by IRDA.

magine two funds that grow at the same rate, 15 per cent a year, for 20 years, but have

different costs: 2 per cent and 2.5 per cent a year. This difference in costs of half a
percentage point (50 basis points) might look insignificant, but has a huge impact: a

loss of Rs 6.11 lakh in the costlier fund if Rs 1 lakh is invested every year in both the

funds for 20 years. Costs are very important, specially in financial products, where

they are invisibly bundled into the product. Costs are also important in the case of

financial products like unit-linked insurance plans (Ulip) that are long term in nature

where they can make one plan great and another average.

Ulips are structured in such a way that the impact of costs is more in the initial years

of the policy. This is why an exit from the policy in the initial years will end up as a

loss for the investor in most cases. A Ulip should be run for at least 10 years with

regularly payment of premiums to make it cost-effective. Ulips come across as

complex products to the average buyer of insurance due to their costs.

Our annual mutual fund ranking devotes much less time to costs than the ranking of

Ulips. The reason for this is that costs are fewer and standardised in mutual funds,

making comparisons very easy. Ulips, on the other hand, are plagued by multiplicity of

costs and vague regulations on cost limits. We believe it is more a fault of the

regulator, Insurance Regulatory and Development Authority (Irda), than the industry.

Ticking off the costs in Ulips, our count went all the way up to four cost heads. A look

at what these costs are and what their impact on your returns will be.

TYPE I ULIPS
TYPE II ULIPS

Premium Allocation Charge


This is a front-end charge deducted from the premium. The premium that is left after

its deduction is invested in units of the funds chosen. The insurer uses this to meet

most of its expenses. In some Ulips, it is as high as 60 per cent, in others it is nil. A

common misconception is that this charge is a crucial indicator of the overall costing

of a Ulip because it is deducted from the premium. However, evaluation of costing

should not be based solely on this charge.

Mortality Charges

This is the actual cost of the life coverage opted for and is deducted from the fund value

on a monthly basis. It depends on a number of factors, including the age of the buyer,

the state of his health and the amount of coverage sought. The basis of this charge

depends on the type of Ulip. In Type I Ulips, this charge is initially deducted from the

entire sum assured. It is later charged on the sum-at-risk, that is, the difference between

the sum assured and the fund value. As a result, mortality expenses fluctuate as the fund

value changes. In Type II Ulips, the mortality charge is levied on the sum assured

throughout the term.

Fund Management Charge


It is deducted as a fixed percentage of the fund value and is used to manage the

investments of the funds. It is the most important charge in Ulips, as gradual rise in

fund value over the years keeps on making the impact larger.

Policy Administration Charge

This is deducted from the fund value every month. It can be a fixed amount throughout

the policy term or vary at a pre-determined rate.

The surrender and fund-switching charges are incidental and may not be levied in

certain circumstances.

Not only do costs vary with products, but also change in one product with the age and

health of the investor, the tenure and sum assured chosen and the features and riders of

the policy. We assumed the sum assured, the buyers age and sex and the term of the

most popular Ulips to create a common ground for a comparison of costs (see How We

Did It on page 32). We found that the internal rate of return (IRR) is the best parameter

for the total impact of costs for the policyholder, as it is the return left over after all the

costs have taken their bites. The regulator mandates assumed rates of return of 6 and

10 per cent on the premium invested for all the projections, known as benefit

illustrations, that agents share with prospective investors. An example will bring out

the impact of costs. Assume that you invest Rs 1 lakh a year in a Ulip for 15 years. At

an annual rate of return of 10 per cent, you get back Rs 26.88 lakh after 15 years. With
zero costs, you would have got back Rs 34.95 lakh. That means costs ate up Rs 8.07

lakh.

We took the IRR, the real return, on annual assumed rates of return of 6 and 10 per

cent, from all life insurers in the fray. The greater the gap between the IRR and the

assumed rate of return, the higher the costs of the policy. It is impossible to cover each

plan in a ranking like this, but do take away this tool. Ask your insurance company for

the IRR of the policy you already have or are planning to buy. Financial products are

likely to become more efficient if the awareness of consumers increases.

sunildhawan@outlookindia.com

HOW WE DID IT

The 2008 edition of the Outlook Money Ulip (unit-linked insurance plan) Ranking had 18 life insurers as

contenders. The parameters used were cost and return. This section deals with cost. We chose to

compare cost through the Internal Rate of Return (IRR), which is derived by deducting the costs from

the annual return on the premiums invested.

The track record of new players like AEGON Religare Life, IDBI Fortis Life and DLF Pramerica Life is

not long enough for judging performance, but they were considered for the ranking on the basis of

cost. We took into account at least one plan per life insurer. Only generic Ulips, and not children, whole

life or pension plans, which cater to specific needs, were ranked. Single premium Ulips and plans that

have an in-built waiver of premium feature were not considered. The idea was to prevent the wrinkles

associated with a comparison of products of different types. Of course, our ranking of child policies that
accompanies the annual Kids Special issue will continuethe next one will happen in early 2009.

The cost structure of Ulips varies according to the age of the buyer, tenure, sum assured and fund

options chosen. We compared the figures for a 35-year-old male, a term of 15 years, annual premium

of Rs 50,000 and sum assured of Rs 5 lakh. We assumed investment of 100 per cent of the premium

in the all-equity fund of the insurer. Using this profile, we collected benefit illustrations (or year-on-year

return projections and costs) of each Ulip of every insurer. Plans in which all the assumptions chosen

were not possible were removed. The exclusions included Birla Sun Life Insurances Platinum Plus

(minimum annual premium: Rs 1 lakh), Bajaj Allianzs Family Assure (maximum annual premium: Rs

15,000), Avivas LifeBond 5, LICs Profit Plus (maximum premium paying term for both: five years),

Birla Sun Life Insurances Gold-Plus II (maximum term: eight years) and ING Vysyas Platinum Life

(maximum term: 10 years). In Outlook Moneys opinion, insurance is a long-term product and needs a

term of at least 15 years to fulfill its mandate.

The next step was to separate Type I and Type II plans. The fray had 32 Type I Ulips (these provide

the higher of sum assured and fund value to nominee if policyholder dies during the term) and 10

Type II Ulips (these give both the sum assured and the fund value to the nominee on death). Care

was taken to measure and rank the Ulips on equal ground without much variation in the underlying

factors. We considered the fund value at the end of the 15th year to arrive at the IRR for 10 per cent

and 6 per cent growth rates. The maximum sum assured is proportional to the term in some plans. In

a few of these cases, a term of 15 years did not allow the sum assured figure of Rs 5 lakh that we

had chosen for comparisons. For such plans, we kept the term as 20 years and took into

consideration the surrender value at the end of the 15th year.

The IRR was used as a parameter because life insurance products are not standardised and, hence,

not easily comparable. We considered the fund corpus after taking into account all the charges,

including those for premium allocation, policy administration, fund management and mortality. The

study factored in the mortality charges for the illustrations that had excluded them. The difference

between the 6 and 10 per cent mark and the respective IRR shows the chunk lost to costs. This gap
will be the smallest for the most cost-effective plan, yielding the highest IRRs.

At a time when investors are no longer willing to risk their money to the uncanny ways of the

market, as in the case of unit-linked insurance plans, insurers have reverted to selling

conventional plans offering guaranteed returns.

Sales of unit-linked plans have declined sharply in the current financial year. Hence,

almost all the schemes launched by insurers in the last few months were guaranteed

plans only.

In vogue

Guaranteed return plans have worked wonders for life insurers. Take for example the

Life Insurance Corporation of India. The public sector insurer launched Jeevan Aastha,

a single premium plan with guaranteed additions, early this year. During the limited

offer period of 45 days till January 21, the scheme mopped up more than Rs 10,000

crore in premium.

The success of Jeevan Aastha prompted the LIC to launch another close-ended

guaranteed plan Jeevan Varsha in February. It is a traditional money back policy.

The LIC, whose market share had been steadily eroding and was around 50 per cent in

November last year, expects to increase its share to 60 per cent after the launch of the

two guaranteed return plans.


ING Vysya Life, Aviva Life Insurance, Aegon Religare Life Insurance, Reliance Life

Insurance, ICICI Prudential Life Insurance and a few others had also launched similar

plans offering guaranteed returns last year to attract investors looking for secured

investments.

Recently, Bajaj Allianz Life Insurance and Tata-AIG Life Insurance Company have

come out with their guaranteed plans Bajaj Allianz Century Plus II and

InvestAssure Apex respectively.

The concept of guaranteed returns was in vogue before the life insurance sector was

opened up to private players.

After private players took the centrestage with their unit-linked plans, they came out

with capital protection (return of premium) guarantees. Almost every private player

now has a capital protection plan in its stable.

However, Birla Sun Life changed the form of guarantee in Ulips with the launch of

Platinum Plus in June last year. The scheme promises a guaranteed unit price on

maturity. This guaranteed unit price or unit NAV (net asset value) will be the highest

NAV recorded on 88 reset dates (the 15th day of each calendar month till June 2015).

Now, Tata AIG Life Insurance has launched a unit-linked plan similar to Birla Sun

Lifes Platinum Plus. In the case of Tata AIGs InvestAssure Apex plan, there will be

100 reset dates (the 10th day of each calendar month).


Is it a good idea?

Guaranteed plans may be the flavour of the season, but are these really good for you or

are these just baits by insurers to rev up their sagging sales?

Guarantees come with a cost, said Sunil Kakkar, chief financial officer of Max New

York Life Insurance Company. A policy buyer should clearly understand what the

guarantee actually means to him because most of these guaranteed amounts are

payable only on maturity of the policy. A policyholder should also understand the costs

involved in a guaranteed plan, he said.

Life insurance is a long-term investment and over a period of 15-20 years equity-

linked investments are self-guaranteed in the sense that the volatility in equity prices is

very low its in single digit, Kakkar said.

Most of these guaranteed return policies have a maximum tenure of 10 years. This

means if you buy a guaranteed plan now for investment purposes and not for

insurance, youll have to buy another policy after 10 years at a much higher premium.

For example, a 20-year-old person has to pay an annual premium of Rs 14,738 for a

Rs 5-lakh basic endowment policy for 30 years. But the annual premium is Rs 23,978

for a 30-year-old person for a Rs 5-lakh policy for 20 years.

Premium prick
The premium rate of a guaranteed return plan is also higher than a non-guaranteed

plan.

Take for example LICs Jeevan Varsha. A 30-year-old person will have to pay an

annual premium of Rs 78,497 for a sum assured of Rs 5 lakh for 12 years under this

plan. But the premium is only Rs 37,850 under the companys non-guaranteed money

back plan, Jeevan Bharti-I.

Similarly, the minimum premium for Tata AIG Lifes InvestAssure Apex plan is Rs

90,000, while the minimum premium is only Rs 12,000 for its InvestAssure Care plan

and Rs 20,000 in the InvestAssure Insta scheme.

Apart from high premium rates, other policy related charges for fund management,

policy administration and surrender are also higher for guaranteed plans. For example,

the policy administration charge, which is deducted every month by cancelling

investment units, in Tata AIGs InvestAssure Apex plan is Rs 93.75 on the first Rs

1,000 sum assured and Re 1 every Rs 1,000 sum assured thereafter.

For Tata AIG's InvestAssure Insta plan, the policy administration charges are Rs 75 on

the first Rs 1,000 sum assured and Rs 3.25 every Rs 1,000 sum assured thereafter. The

fund management charges are also higher in InvestAssure Apex than in InvestAssure

Insta.
In Birla Sun Lifes Platinum Plus plan, the minimum annual premium is Rs 1,00,000,

while it is just Rs 50,000 in its Gold Plus II plan. Policy administration charges are

also much higher in Platinum Plus plan than Gold Plus II plan.

The word guarantee may sound great, but it comes at a cost. As a policy buyer, you

must understand and compare well what is the guarantee you are getting and at what

cost. Moreover, these guaranteed return plans mostly invest in debt instruments. Given

a 10-year investment horizon, you should determine whether you want to lock in your

funds in debt instruments or equities that have historically given much higher return in

the long run

. Since their launch, Unit Linked Insurance Plans (ULIP) have been a complete rage;

but that's not the case now. This year, thanks to the slowdown, insurers are seeing

lower premium income compared to last year.

So to maintain the spark in ULIPs, insurance companies are trying to entice buyers by

offering guaranteed returns on ULIPs.

How's that possible? Lets decode.

As of now three insurance companies are offering guaranteed ULIPs.

SBI Life Insurance Smart ULIP


Birla Sun Life
Platinum Plus II
Insurance
Tata AIG Life InvestAssure Apex
Insurance

Unlike non-guaranteed ULIPs, these newly launched plans shield you from the

downside of the market by assuring guaranteed returns.

He explains that these plans are like investing in fixed income products that offer

secured returns.

Workings of the plan:

These plans are structured into four phases.

Subscription phase: During this phase, the plan is open for a limited time only. For

instance, SBIs Smart ULIP is open for a period of one year.

Premium paying phase: In this phase, you pay premium only for a fixed term, which is

3 years. However, SBIs Smart ULIP allows you to choose the premium paying term

for 3 or 5 years.

NAV build-up phase: During this phase, the reset dates, set by the companies are

exercised. Reset dates are pre-decided dates fixed by insurance companies to record

NAVs. Birla Sun Life and Tata AIG record NAV once a month on the reset date

decided by them whereas SBI has two reset dates every month to record NAV.

These plans have a fixed term of 10 years.


Accumulation phase: The remaining policy term i.e. the tenure left after all the reset

dates have been exercised is the accumulation phase.

Whats unique about guaranteed ULIPs is that they offer the highest Net Asset Value

(NAV) recorded over a given a period of time.

Benefits:

Maturity benefits: On maturity, you get the highest of:

a. The fund value as on date of maturity OR

b. The fund value at the rate of 'highest recorded NAV' OR

c. The starting NAV of Rs 10 per unit

The is highest recorded NAV is the higest NAV among all reset dates.

Death benefits: In case of your untimely death, either fund value or sum assured will

be paid out to your nominee, depending on whichever is higher.

What should you watch out for?

1. Charges are more:

When you compare guaranteed ULIPs to single premium or limited premium paying
term plans, the charges on the former are on the higher side. The table below explains
this. It shows the net amount invested at the end of three years after deducting the
policy allocation charges. The sum assured for the plan is assumed to be Rs 5 lakh and
premium Rs 1 lakh
Charges(%)
Birla Tata AIG
SBI Life
Sunlife Life
Insurance
Insurance Insurance
Smart Platinum InvestAssure
Policy year
ULIP Plus II Apex
Policy term
10 years 10 years 10 years
of the plan
Year 1 15 10 9.5
Year 2 5 4 4
Year 3 5 4 4
Net
investment
Rs Rs
at the end Rs 88,060
272,800 265,800
of
3 years
Gold Plus InvestAssure
Policy year SBI Elite
II Plus
Policy term
10 years 8 years 15-30 years
of the plan
Year 1 10 8 9.5
Year 2 7 4
Year 3 7 4
Net
investment
Rs Rs
at the end Rs 96,750
275,400 276,306
of
3 years

Note: The calculation for Tata AIG has been done taking into account the charges for

1st year only because InvestAssure Plus is a single premium product. However, for

information purpose, Invest Assure Apex shows figures for 2nd and 3rd years also.

2. Limited option in hands of investor

These plans don't have a switching option. They also have only one choice of fund that

invests in a mix of debt and equity. An investor is at the mercy of the fund manager
because on one hand, his money is locked in while on the other, he has not flexibility

to switch.

Conclusion:

Harsh Roonga, CEO, Apnapaisa.com says, "If you want to invest in safe avenues there

are better options like public provident fund, bank deposits; why pay a charge for it."

And anyway, he adds,"Its always better to keep your insurance and investment needs

separate."

Multilevel Marketing
The Concept

Direct sales is a method of


istributing consumer products
directly to customers instead of
selling through shops. Direct SLM MLM
sales can be single level (SLM)
or multi level (MLM). In MLM or
so called network marketing
one has the opportunity to earn
commissions on the sales of
multiple level of representatives

In comparison to SLM, MLM


creates opportunity for very
large groups for very large
income by creating opportunity
for very large customer's base
to be served directly.

Chapter-3
RESEARCH
METHODOLOGY

RESEARCH METHODOLOGY
TYPE OF DATA COLLECTED

There are two types of data used. They are primary and secondary data. Primary data
is defined as data that is collected from original sources for a specific purpose.
Secondary data is data collected from indirect sources. (Source: Research
Methodology, By C. R. Kothari)

PRIMARY SOURCES

These include the survey or questionnaire method, telephonic interview as well as the
personal interview methods of data collection.

SECONDARY SOURCES

These include books, the internet, company brochures, product brochures, the
company website, competitors websites etc, newspaper articles etc.

SAMPLING

Sampling refers to the method of selecting a sample from a given universe with a view
to draw conclusions about that universe. A sample is a representative of the universe
selected for study.

SAMPLE SIZE
The sample size for the survey conducted was 270 respondents. This sample size was

taken on 95% confidence level and 6 significant levels. Data universe for this sample
is 10,00,000 which is approx population of kotar excluding people below age of 18

years.

SAMPLING TECHNIQUE

Random sampling technique was used in the survey conducted.

PLAN OF ANALYSIS

Tables were used for the analysis of the collected data. The data is also neatly
presented with the help of statistical tools such as graphs and pie charts. Percentages
and averages have also been used to represent data clearly and effectively.
STUDY AREA

The samples referred to were residing in KOTA city.

ANALYSIS
AND

INTERPRETATION
PLATINUM PLUS FUND - 1
Portfolio as on 30th September 2009 About the Fund
Objective: optimi the participation in an manag wel
SECURITIES HOLDING To
diversified ze
equity activelyof fundamentally strong
portfolio ed l
blue
chip companies while using debt instruments &
derivatives to lock-in capital appreciations
GOVERNMENT SECURITIES 0.60%
Strategy:: The strategy of the fund is to have an optimum
mix of equities &
10.45% GOI 2018 0.60% fixed income instruments, with up to 100% exposure in
both equities & fixed
income assets & up to 40% in Money Market
NATIONAL BANK FOR
ORPORATE EBTAGRI. & RURAL 0.90
5.56%
DEV 2018 HOUSING BANK 2018
NATIONAL %
0.82% G-Secs MMI
8.65% NTPC LTD. 2019 0.60% 4.36%
NCD
5.56%
0.63% NATIONAL BANK FOR AGRI. & RURAL DEV 2019

0.57%
10.85% POWER FINANCE CORPORATION LTD 2018 0.28%
10.85% RURAL ELECTRIFICATION CORP LTD 2018 0.23%
Equities
89.49%

EQUITY
BHARAT HEAVY ELECTRICALS LTD. 89.49%
5.09%
INFOSYS TECHNOLOGIES 4.65 Rating Profile
LTD.
LARSEN & TOUBRO LTD. %
4.53%
BHARTI AIRTEL 4.38
LTD.
HOUSING DEVELOPMENT FINANCE COR LTD % P1+ / A1+
Sovergin 10%
4.27% ITC LTD 9%
3.94% HDFC BANK LTD.
3.67% STATE BANK OF INDIA
3.60% OTHER EQUITY

MMI 4.36%
AAA
81%

Sectoral Allocation

BANKING 18.16%

OIL & 14.31%


GAS
11.83%
CAPITAL
GOODS 8.05%

TELECO 7.72%
M
6.99%
FMCG
6.28%
IT
5.58%
FINANCIAL SERVICES
4.52%
POWER
4.19%
PHARMA
3.60%
Maturity Profile AUTO
2.20%
METAL
1.75%
59.61% CEMENT
40.39% 1.66%
DIVERSIFIE
D 1.66%

CONSTRUCTIO 1.50%
N
Less than 2 years 7years & above
PLATINUM PLUS FUND - 2
Portfolio as on 30th September 2009 About the Fund
ObjectiveTo optimize the participation in an actively
SECURITIES HOLDING managed well
diversified equity portfolio of fundamentally strong blue
GOVERNMENT SECURITIES 0.00% chip companies while using debt instruments & derivatives
to lock-in capital appreciations:
CORPORATE DEBT 3.24% fixed income instruments, with up to 100% exposure in
Strategy: The&strategy
both equities fixed of the fund is to have an optimum
NATIONAL HOUSING BANK 1.20 mix of equities &
2019 %

income assets & up to 40% in Money Market


4.8% HDFC LTD 2011 Asset Allocation
MMI
NCD
6.64%
3.24%

EQUITY 90.11%

RELIANCE INDUSTRIES LTD.

6.99% ICICI BANK LTD.


Equities
90.11%
5.82% BHARAT
BHARTI AIRTEL HEAVY ELECTRICALS LTD.
4.52
LTD.
HOUSING DEVELOPMENT FINANCE COR LTD 4.26%
%
HDFC BANK 3.84 Rating Profile
LTD. %
AA+
ITC LTD
OIL & NATURAL GAS CORPORATION LTD. 3.84 6%
3.79% OTHER EQUITY

42.51%
P1+ / A1+
10%

MMI 6.64%
AAA
84%

Sectoral Allocation

BANKING 18.45%

OIL & 13.53%


GAS
11.78%
CAPITAL
GOODS
8.54%

TELECO
7.76%
M

7.54%
IT

6.34%
FMCG

5.36%
FINANCIAL SERVICES

4.65%
POWER
Maturity Profile 4.46%
METAL
75.21%
4.28%
PHARMA

3.95%
AUTO
24.79%
1.73%
CEMENT

1.64%
REAL
Less than 2 years 7years & above ESTATE
INFERENCES

AND

CONLUSION
CONCLUSION
After completion of research, we conclude that: -
Segmentation of target market is best way to work in.
Womens are proving better advisor.
Cut throat competition as new insurance companies are also opening branch.
Private insurance sector making their place in insurance sector.
Advisor should be approach according to need.
In short can be said that Advisor have to do more for their good future as it is on
a good position as private insurance is concerned. According to survey there are
various player in market ( Kota ) and really it is difficult to survive on the basis
of brand name for different products.
So there is not much awareness in Kota city about BSLI as it started working
from August 2011. What we think Birla Sun Life Insurance just need
promotional activities.
During our promotional activities when we found that Birla Sun Life Insurance
could capture big market in Kota. They would be on one . One position in Kota
because the benefits and flexibility which Birla Sun life providing is not
provide by any other insurance company in Kota. ICICI prudential is the only
private player, which is there in competition with TATA-AIG. As ICICI
prudential launch first so it capture the market very soon , And LIC is
concerned they have advantage of public mentality a very safe investment
At last we want to state that Birla Sun Life Insurance need promotional actives
and the benefits should be given to the customers. Customer satisfaction should
be first preference.

.
OPPORTUNITY:

There is continuous growth in insurance sector and rural market is still


untapped.

People have started turning towards private insurance sector as they know
that security and growth of money is better then another insurance company.

Government has also started investing in private insurance sector.

Market is fully to capture because the branch has set up in near years , so
there be chances to grow.

THREATS:

Competition in insurance sector is increasing with the entry of private


giants like HDFC standard life, tata aig, BAJAJ alliance, LIC etc.

Continuous follow up of the clients and customer by the other insurance


companies.

As LIC has strong market position so it is little bit difficult to capture the
market.

Customer is still find risky to place its money in private insurance sector.
SUGGESTION
Advisor should be given more training time to time to have better
knowledge for change in market.
Mass insurance policy should be launched
Untapped areas should be cover.
There are more than 75 crores population in villages. This represents a vast
potential.
Advisor should be supervise regularly so that their work can be improved
and made effective and efficient.
The advisor should be keeping in constant touch with his policy holder to
become aware of the change in his situation including marriage. Death of
relatives. Releases of mortgages.
Any one of them may necessitation some changes like title to policy moneys
or more insurance. The contact conveys a message that agent and company
cares for the policy holder and the family mouth publicity it increase
acceptability.
Private insurance companies should highlight that they are managed
privately but completely governed by IRDA.
To capture major chunk of business they need to open more branches in sub
urban so that they can fulfill all need of customers.
Aware should be created among the masses through advertising.
Annexure 1 : The Malhotra committee customer Service
Report & IRA BILL
In 1993, Malhotra Committee, headed by former Finance Secretary and RBI
Governor R.N. Malhotra, was formed to evaluate the India insurance
industry and recommend its future direction in 1994, the committee
submitted the report and gave the following recommendations: -

Structure
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 its 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.
Post Life insurance should be allowed to operate in the rural market.
Only one state- level insurance company should be allowed to operate
in each state.
Regulatory Body :-
The insurance Act should be changed.
An insurance regulation body should be set up.
Controller of insurance (currently a part of the Finance Ministry)
should be made independent.
Investment: -

Mandatory investments of LIC life Fund in government securities to


be reduced from 75% to 50%.
GIC and its subsidiaries are not to hold more than 5% in any
company ( Current holding to be brought down to this level over a
period of time)

Customer Service: -

LIC should pay interest on delays in payment beyond 30 days.


Insurance companies must be encouraged to set up unit linked pension
plans.
Computerization of operation and updating of technology to be
carried out in the insurance.
Overall, the committee strong felt that in order to improve the customer
service and increase the converge of the insurance industry should be opened
up to competition.
BIBLIOGRAHY
WEBSITES:-

www.birlasunlife.com

www.amfi.com

www.financialplanning.com

www.financialexpress.com

www.valueresearchonline.com

www.mutualfundindia.com

www.goole.com

BOOKS:- Research & Methodology CR Kothari

Research Method in Business cooper shilledr

Research method S.K. Bhattacharya


QUESTIONNAIRE

MARKET RESEARCH SURVEY


QUESTIONNAIRE
Name.

Age.. Contact no

Address.............................

Qualification.

Q1. Do you know about insurance?

(a) yes ( )

(b) no ( )

Q2. Do you know BIRLA SUNLIFE?

(a) yes ( )

(b) no ( )

Q3. Which kind of insurance do you prefer?

(a) private ( )

(b) goverment ( )

Q4. Have you ever seen BSLI advertisement?

(a) yes ( )

(b) no ( )

Q5. Ever tried BSLI product(platinum plan)?

(a) yes ( )

(b) no ( )
Q6. if you not tried BSLI then why?

(a) inferior quality ( )

(b) high price ( )

(c) lack of awareness ( )

(d) other ( )

Q7. Which company you prefer?

(a) LIC ( )

(b) ICICI ( )

(c) BSLI ( )

Q8. Which factor influence you most while purchasing?

(a) service ( )

(b) product ( )

(c) advertisement ( )

(d) schemes ( )

Q9. When you purchase insurance?

(a) occasionally ( )

(b) anytime ( )

(c) quarterly ( )

(d) half yearly ( )


Q10. to whom you consult before choosing a particular insurance?

(a) self ( )

(b) others ( )

Thank you

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