PROJECT REPORT SUBMITTED THE PARTIAL FULFILLMENT OF THE M.B.A.

DEGREE ON SYNERGY OF HIGH NETWORTH INDIVIDUALS (HNIS) WITH THEIR DISTRIBUTION CHANNEL

SESSION-2009-2011

Submitted to: RAJASTHAN TECHNICAL UNIVERSITY KOTA (RAJASTHAN)

Submitted by:

RAKESH KATARIA

M.J.R. Collage of Engg. & Technology, Jaipur

PREFACE
Theories are being developed, designed and stated on the groundwork of their practical implementation and usage. Work experience seems to be the most effective and indispensable factor of making an individual an adept. This is because one can not do without being exposed to varying circumstances and possible consequences. Training not only develops individual skills and abilities but also provides proficiency in work performance. This report served as a means to share my personal experiences while working on this project which provided me the platform where I was face to face with practical aspects of theoretical knowledge gained so far. This training project report has been prepared during the summer training of 45 working days in an organization. It is an integral part of MBA curriculum. The summer training was challenging, gainful and interesting and it gave real insight of corporate world. I sincerely believe that there is no better place to learn the practical side of management studies than the industry itself.

ACKNOWLEDGEMENT
The project report prepared by us though bears our name alone but is actually a collective effort. I am indeed indebted to a lot of people and their names surely deserve to be mentioned. I feel immense pleasure in conveying my heartiest thanks and deep sense of gratitude to Mr. Satya Prakash Singh, Channel Development Manager HDFC Standard Life Insurance Company Ltd. Jaipur, for giving me an opportunity to work on the project. I offer my sincere thanks to Mr. Mahendra Kumar Bairwa, Sales Development Manager HDFCSLIC Ltd. Jaipur-IV, for their regular guidance in the project and to sharpen my rough edges from time to time. I would like to particularly mention my deep gratitude to Prof. Satish Agarwal, Head of Department (Department of management studies) and Dr. Shiv Prasad (Training and Placement officer) Management Studies giving their consent and blessings to undertake this training.

(RAKESH KATARIA)

CONTENTS
1. Introduction 2. Company Profile 3. Vision and Values of the Company 4. Branch Profile 5. Products of HDFCSLIC Ltd. 6. SWOT Analysis 7. Findings and Suggestions 8. Questionnaire 9. Conclusion 10. Bibliography

INTRODUCTION
Introduction to Insurance
Every asset has a value for its owner and also for those who are benefited with the existence of that asset. Insurance is concerned with the protection of economic value of assets. Every asset has normally an expected lifetime. During this period, it is expected to perform and provide income/comfort to the owner. The owner, being aware of this, plans the things in such a way that by the time the expected lifetime of the asset expires, he is ready with the funds required for its replacement. In this way, he ensures that the value or income from the asset is not lost. Well, this appears to be a fine arrangement provided the asset completes its expected lifetime! All assets carry the risk of being destroyed or damaged. But all assets may not necessarily get destroyed or damaged. Only in a few instances, the probability turns out to be true and the asset gets actually lost or destroyed by accident or some other unfortunate event before the completion of its expected lifetime. The owner and those deriving benefits from the asset will suffer because the arrangement to make available its substitute is not yet ready.

Insurance is helpful in mitigating such adverse consequences. To sum up, assets are insured, as they are likely to be lost or made nonfunctional through an accidental occurrence. Insurance does not protect the assets. This means that insurance cannot prevent loss to the assets due to perils. Nor can insurance avoid the occurrence of the perils. It only compensates, may not be fully, the economic or financial loss resulting to the asset from such damage or destruction.

History of Insurance
The beginning of insurance business is traced to the city of London. It started with the marine business. Marine traders, who used to gather at Lloyds coffee house in London, agreed to share losses to goods during transportation by ship. Marine related losses included: Loss of ship by sinking due to bad weather in high seas. Goods in transit by ship robbed by sea pirates. Loss of or damage to the goods in transit by ship due to bad weather in high seas. The first insurance policy was issued in England in 1583.

Life Insurance in India

In India, insurance started with life Insurance. It was in the early 19 th Century when the Britishers on their postings in India felt the need of life insurance cover. It started with English Companies like... The European and the Albert. The First Indian insurance company was the Bombay Mutual Assurance Society Ltd., formed in 1870. In the wake of the Swadeshi Movement in India in the early 1900s, quite a good number of Indian companies were formed in various parts of the country to transact insurance business. To name a few:: Hindustan Co-operative and National Insurance in Kolkata; United India in Chennai; Bombay Life, New India and Jupiter in Mumbai and Lakshmi Insurance in New Delhi.

Nationalisation of Life Insurance in India

In 1956, life insurance business was nationalized and LIC of India came into being on 1.9.1956. The government took over the business of 245 companies (including 75 provident fund societies) who were transacting life insurance business at that time. Thereafter, LIC got the exclusive privilege to transact life insurance business in India

Purpose and Need for Insurance

Assets are likely to be destroyed or made non-functional due to accidental occurrences called perils. Assets can, therefore, be insured. A few examples of perils are: fire, floods, breakdowns, lightning, earthquake etc. Perils are the events. Risks are the consequential losses or damages. Possibility of damage to asset caused by any peril is the risk that asset is exposed to. Risk means uncertainty or unpredictability about future loss or damage, which may or may not happen. This refers to the losses, which may happen suddenly and unexpectedly. We can say that a human life is also an income-generating asset. Human life may be lost due to unexpected early death or become non-functional following sickness or disabilities cause by accidents. If this happens by the time one is on the verge of retirement when his income is about to cease, he might have made alternative arrangements to meet his needs.

Types of Insurance

1. Non-Life Insurance

2. Life Insurance

Basically Non-Life Insurance Includes: Marine Insurance Fire Insurance Miscellaneous Insurance Vehicles Furniture Building Aircrafts General

Life Insurance Includes: Only Human Life Insurance Human beings sickness, illness Long term concept

COMPANY PROFILE The HDFC Group

HDFC was incorporated in 1977 with two primary objectives - to enhance housing stock in the country through housing finance systematically and professionally and promote home ownership. Today they are the largest residential mortgage finance institution in India, with a net worth of Rs. 2,703 crores as of March 31, 2002 and an asset base of over Rs. 22,000 crores. HDFC also aim to increase the flow of resources to the housing sector by integrating the housing finance sector with the overall domestic financial markets.

HDFC has demonstrated the viability of market oriented housing finance in a developing country. The World Bank considers us a model private sector housing finance company in developing countries and a provider of technical assistance for new and existing institutions, in India and abroad. HDFC is also the largest mobilize of retail deposits in the private sector outside the banking circle. Their deposits have been awarded the highest safety credit rating 'FAAA' & MAAA by CRISIL and ICRA respectively for eight consecutive years.

While being a household name in India and the undisputed market leader in the fields of housing finance, their social responsibilities have remained in focus.

10

GROUP COMPANIES OF HDFC

HDFC Bank Limited HDFC Securities Limited HDFC Asset Management Company Limited HDFC Realty Ltd. HDFC Deposits HDFC Standard Life Insurance HDFC Chubb Intelenet

11

HDFC Bank Ltd.

The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive approval from the Reserve Bank of India (RBI) to set up a bank in the private sector. The bank was incorporated in August 1994 in the name of HDFC Bank Limited, with its registered office in Mumbai. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.

Awards
Best Listed Bank of India by Business world. Best Domestic Bank by The Asset Magazines Triple A Country Award. Best Local Cash Management Bank2006 in Large and Medium segmentsAsia money Awards Best Bank in India in 2006Euro money Awards

12

HDFC Asset Management Company Ltd.

HDFC Asset Management Company Ltd. (AMC) was incorporated under the Companies Act, 1956; on December 10, 1999 and was approved to act as an Asset Management Company for the HDFC Mutual Fund by SEBI vide its letter dated June 30, 2000.HDFC Asset Management Company Ltd. (AMC) is one of the most growing Mutual Fund Company of India.

Awards
HDFC mutual fund was recently awarded the CNBC Moddys investor service award for the best performing fund house for the one year category. Zurich also received the best performing fund house award for the three year category.

HDFC Chubb
13

Its

partnership

that

leverages

the

strengths

of

two

financial

powerhousescombining the trust and local experience of HDFC, Indias premier financial services company, with the 120 years proven expertise of CHUBB, a global leader in non-life insurance backed by a network of 134 offices in 31 countries. Chubb today provides property and casualty insurance through more than 10,000 employees in 32 countries of North America, South America and Asia.

14

Intelenet

Intelenet is a leading BPO service provider with the focus on providing solutions to global Organizations seeking to reduce the cost while consistently maintaining superior level of standards two leading global investorsHDFC and Barclays--provide the financial banking Intelenet needs to lead in a global marketplace. Barclays is a venerable financial services group headquartered in the United Kingdom, ranking amongst the services group headquartered in the United Kingdom, ranking among the Top 10 banks in the world based on market capitalization. Intelenet impacts your business by seeking to reduce costs while consistently maintaining superior levels of service. Our solutions extend across all strata of BPO, technology and consulting.

Awards

15

 Deloitte Technology Fast 50 India 2005 Program

Intelenet Global Services has been ranked first among BPOs while standing third overall in the Technology, Media and Telecommunications (TMT) sectors across India.

Deloitte Technology Fast 50 India 2006 Program

Intelenet Global Services has continued its ranking, second time in a row, as amongst the top 50 fast growing technology companies in India.

Maharashtra 2005

Information

Technology

Awards

Intelenet Global Services came in a close second in the IT Enabled Services category at the Maharashtra Information Technology Awards2005.

16

HDFC Deposits
DEPOSITS
HDFC has instituted well-defined service standards for both depositors and deposit agents. HDFC has been able to mobilize deposits from over 10 lac depositors. Outstanding deposits grew from Rs. 1,458 crores in March 1994 to Rs. 8,741 crores in March 2006. Much of this success can be attributed to its strong brand image, superior services, security and above all, the significant contribution made by HDFCs deposit agents. HDFC has over 50,000 deposit agents and distributes all its retail savings (deposit) products primarily through this channel.

Awards
HDFC has been awarded AAA rating and MAAA rating for its deposits from both CRISIL and ICRA for the twelfth consecutive year, representing highest safety as regards timely payment of principal and interest.

HDFC Realty Ltd.

17

Realty Limited
HDFC Realty Ltd. Is a new, organized electronic marketplace for properties, to provide the entire gamut of real estate services, bringing together the click world and the bricks world in a revolutionary and user-friendly way. Making available the best guidance and the most professional, transparent, efficient service to the real estate customer.

HDFC Securities Ltd.

18

SECURITIES
HDFC Securities Ltd was promoted by the HDFC Bank & HDFC with the objective of providing the diverse customer base of the HDFC Group and other investors, a capability to transact in the Stock Exchanges & other financial market transactions.

HDFC Standard Life Insurance Company Ltd.

HDFC Standard Life Insurance Company Ltd. is one of India's leading private insurance companies, which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.), India's leading housing finance institution and a Group Company of the Standard Life, UK, and leading providers of financial services in the United Kingdom. HDFC as on March 31, 2007 holds 81.9 per cent of equity and Standard Life was holding 18.1 in the joint venture.

Highlights
First life insurance Company in the private sector to get license from the regulator IRDA.

19

 First life insurance Company to come out with Term Assurance Plan. First private life insurance Company to declare bonuses consecutively for 6 years from inception. First life insurance Company to introduce open option to the pension plan policyholders. First life insurance Company to introduce Automatic Allocation Option to all the policyholders under Unit Linked Plans. Only life insurance Company to give 24 free switching option to Unit Linked Policyholders. HDFC is one of the fastest growing Private Life Insurers and today have more than 8 lakh policyholders. HDFC have one of the widest networks with more than 160 branches and servicing over 440 towns. HDFC Standard Life Insurance Company has one of the highest brand recalls of around 86%. (Source: AC Neilson ORG MARG, September 2005). A high brand recall translates to higher chances of customers buying insurance from them.

Awards

20

Over a decade of its operations, HDFC Standard Life Insurance Company Ltd. has been recognized, rated and awarded by a number of organizations, which include: Winner of the Out Look Money Award for two

consecutive years. Voted as the Most Respected Life Insurance Company by Business World in 2004.

HDFCs KEY STRENGTHS

Financial Expertise
As a joint venture of leading financial services groups, HDFC Standard Life has the financial expertise required to manage your long-term investments safely and efficiently.

Range of Solutions
We have a range of individual and group solutions, which can be easily customized to specific needs. Our group solutions have been designed to offer you complete flexibility combined with a low charging structure.

Track Record so far

21

Our cumulative premium income, including the first year premiums and renewal premiums is Rs. 1532.21 Crores Apr-Mar 2005 - 06. We have covered over 1.6 million individuals out of which over 5,00,000 lives have been covered through our group business tie-ups.

VISION & VALUES

Our Vision The most successful and admired Life Insurance Company, which means that we are most trusted company, the easiest to deal with, offers the best value for money, and set the standards in the industry. In short, The most obvious choice for all.

Values Integrity Innovation Customer Centric People Care Team Work Joy & Simplicity

22

BRANCH PROFILE OF HDFCSLIC, TONK ROAD

HDFC Standard Life Insurance Companys branch at Tonk Road, Jaipur was started in October 2006. It was started with the aim to provide best of Insurance services with the core values of Integrity and Customer Centric Behavior. HDFCSLIC Ltd. Tonk Road, Jaipur has excelled in all its services. It offers almost all products of the Company. Some of them are saving plans, pension plans, various investment plans etc. It has a well-planned organization structure. This branch is integrated by 4 branches, Jaipur-III, Jaipur-IV, Jaipur-V and Jaipur-IX. All the branches headed by Territory Manager Mr. Sumeet Chugh and Branch Managers Mr. Siddarth Singh (Jaipur-III), Mr. Rajesh Gupta (Jaipur-IV), Mr.Utkarsh Upadyaya (Jaipur-V), Mr. Chardra Shekhar Paliwal (Jaipur-IX), and other staff members working in various departments and dealing in each of the products. Under each Branch Manager there are around 8-12 Sales Development Managers (SDM), who takes the responsibility of promoting and selling of HDFCSLICs products.

Classification of life insurance plans

Life insurance plans can be classified into the following four categories according to the 23

Features: Protection Plans Investment Plans Pension Plans Savings Plans

Protection Plans
As the name suggests this category of plans are designed to protect the income earning capacity of the life assured. The present income of the life assured therefore forms the basis of the life insurance. A person with no income therefore cannot be given this plan. The plan is therefore not offered to students, housewives and minors. The plans are in the nature of assurances rather than pure insurance. Under the plan the insurance company assures the policyholder that a lump sum of money would be paid on the happening of the insured event. Thus even if the life assured does not earn the same level of income at the time of the happening of the insured event, as at the time when he took the insurance, the lump sum is still payable. The premium collected under this category of plans is generally sufficient to cover the risk insured. There is no return of premium on the expiry of the cover; however a saving element can be built under the plans to return the savings amount at maturity. The plans do not share in the profits of the company and have no bonuses. The risk is common to the poll of policyholders who by purchasing the plan choose to share the risk with group. The claims are paid from the contributions made by the policyholders. The premium paid by the

24

policyholder is sufficient to cover the risk and expenses, hence generally on the expiry of the cover nothing is payable. Under the protection plans the risk is covered for a premium, which is sufficient to pay the claims and the expenses. It is therefore necessary for the insurance company to ensure that the claims do not exceed the assumed mortality. To ensure this, the insurance company would strictly underwrite the protection plans. There is also a stiff competition under the protection plans as the plans of two companies can be compared on the basis of the premium charged. Every company tries to get the share of the market by keeping the premium under this category lower. The only way for a company to keep the premium low over a long period is to control the expenses and claims. The service factor is also important while selling a protection plan. How quickly the claim would be settled matters. In case a company is charging some few rupees more but is known for quick settlement of the claim the client would not mind going with such company. Hence the premium rate as well as the service should be explained to the client while selling the protection plans. The plan should be sold on the basis of the Human Life Value (HLV) concept. As per the HLV concept every individual has an economic value, which is equal to the present value of all future earnings of that individual. Company should sell this plan to clients who have an income and a financial responsibility. This form of insurance is also called a young persons privilege as it is easy to get this insurance when you are young and since savings are low when a person is young he should possess this cover in case of an unforeseen event. Rider Benefits also fall in this category of plans. Under the rider the insured event is defined and claims are payable only if the insured

25

event as defined occurs. Rider benefits usually come with a number of exclusions. One should understand the exclusions and the definitions of the rider benefit before choosing a rider.

HDFC Standard Life Company has two products in this category and they are:
1. Term Assurance Plan 2. Loan Cover Term Assurance Plan

Investment Plan
As the name suggests this category of plans are designed to help the person reduce some of the risk of investments. All the investment risks cannot be reduced. What the investment plans try to do is to create a pool of investors so that they can get the advantage of large funds, diversified investments, professional management and better returns.

26

Investment plans can be designed to protect the policyholder against the market fluctuations. However all policyholders cannot be protected at the same time against market fluctuations. It is common to allow the protection to a small group of policyholders at any given point of time. One of the objectives of the investment type of plans is to give a good return to the policyholder. When risk covers are integrated with the investment plans the cost of the risk covers reduce the returns to the policyholders. To avoid the risk cover costs the plans do not offer huge risk covers. Hence in these type of plans, premium paid by policyholder is almost equal to the sum assured. The premium under the plans mainly consists of investment. It would not be correct to compare this category of plans on the basis of the sum assured and the premium paid. In case a higher premium is collected under the plan, the company would be in a better position to pay a bigger amount on maturity/death. A better way of comparison would be to compare what the client pays and what he would get under the plans. At the time of selling unfortunately you would not be able to show to the client as to what he would get under his plan. Illustrations and past bonuses are something you can use to convince the client. The company background and the philosophy of the company can also be used to convince the client. Life insurance investment plans are designed for long-term

investments. It is not cost effective for a life insurance company to design a short-term investment plan. It is therefore usual for these types of plans to have a term of 10 years and above. It is important to make the client understand that he is entering into a long-term

27

investment when he purchases and investment plan form a life insurance company. This plan is useful when the client is looking for investment for a long term financial needs which requires investment of money for a long term. The investment plan can be designed as a with-profits contract or a unit linked contract. In a with profits contract the returns are smoothened while under the unit linked contract the returns to the client depend on the movement of the Net Asset Values (NAVs) of the units purchased.

Pension Plans
Pension Plans are designed to provide pension. With the interest rates fluctuating and the increase in longevity the interest in the pension products has been growing in the recent past. Life pensions provide an

28

income till death and this is attractive in the above mentioned scenario. The Indian society has been moving from the joint family system to the nuclear family system. There is also no form of social security schemes, which provide an income in the old age. It is therefore important that all individuals think about their retirement and save for an income in the old age. Pension Plans help the client to build the pension fund, which is earmarked, to provide for the pensions and pay the pensions on the chosen retirement date. Pension Plans can be further classified into the following two categories: 1. Deferred Pension Plans These plans help the client build the pension fund during his earning years and convert the fund into pensions on the chosen retirement date. 2. Immediate Pension Plans These plans pay a pension

immediately after the lump sum purchase price is paid to the insurance company.

The deferred pension plan has two parts. In the first part the savings of the policyholder is accumulated to create a fund for the purchase of a pension on the chosen date. This accumulation can be offered through a with-profits fund or through the unit linked mechanism.

29

In the second part the fund is used to purchase an annuity chosen by the policyholder. There are various immediate annuities, which are available and the client should choose one, which suits him the best. The choice of the annuities is therefore given to the client just before the annuity starts. The aim of a deferred pension plan is to provide a good annuity to the client. Risk covers are therefore not built in the plan. This is to ensure that the cost of the risk cover does not reduce the amount available for pension. The deferred pension plan works like a savings plans with the difference that the amount at the end of the contract is paid in the form of pension. In the event of death before the pension starts the premium is returned with interest.

HDFC Standard Life launched the following plans in this category:

1. Personal Pension Plan (with profits)

2. Unit Linked Pension Plan

Savings Plans
The savings plans are designed to help a person save for a long-term event. Long-term savings have inherent un-certainties. Besides long 30

term savings instrument are not available in the market. The savings plans aims to provide a solution to the client in this area with the benefit of life insurance. It is important to note that the insurance cover offered is on the savings. While purchasing the plan that the policyholder has a savings target in mind. The plan aims to protect this target in the event of the death of the life assured. In the event of the death of the life assured during the term, in addition to the amount saved the amount, which could not be saved is also paid to the beneficiary. The premium paid by the policyholder consists of the savings. The risk cover cost on the savings forms a very small portion of the premium. The effectively means that the premium paid by the policyholder would determine the maturity amount that the policyholder would ultimately get. Thus comparison on the savings products of two companies, on the premium and the sum assured is a wrong method of comparison. Savings plans offer the clients a good vehicle to build savings for a long-term financial need. The earlier the client starts a savings plan the lesser he would have to contribute as his savings would grow bigger

due to the effect of compound interest. To sell a savings plans you need to identify the long term savings needs of the client and explain to him the benefits of savings through life insurance. Savings plans have a risk element, which needs to be underwritten to ensure that the death claims are controlled. In case a company is very liberal in granting the covers the
chances are that the policyholders who survive would get a lower

31

maturity benefits. Maturity benefits can be enhanced by a strict control on the claims and the expenses. Savings Plans can be offered as a with-profits plan or a unit linked plan. A with profits fund aims to smoothen the returns to the policyholder using the bonus mechanism while the returns to the policyholder under a unit linked plan depends on the movement of the unit prices.

HDFC Standard Life offers the following savings plans:

1. Endowment

Assurance

Plan

(with

profits)
2. Money Back Plans (with profits) 3. Childrens Plan (with profits) 4. Unit Linked Endowment Plan

PRODUCTS: AT A GLANCE
1. Endowment Assurance Plan Savings for a better tomorrow 32

Introduction
The Endowment Assurance Plan is a with profits savings contract which aims to give good maturity values to the client by investing the funds as per the IRDA guidelines and reducing claims and costs. The aim of the plan is to pay good maturity values so that the savings objectives of the policyholders are met.

Need for the Plan

The Endowment Assurance Plan is designed to provide a solution to the long term financial needs. It is often felt that people save only when their income is more than their expenses. To put it bluntly if a person can earn more than what he can spend he can save. In reality this is not the situation as one finds that it is impossible to save with the current level of expenses. Why does this happen? Expenses are a function of our needs, which arise due to our wants. We all know that the wants of a human being are unlimited. Consequently the needs keep on increasing and often increase at a rate higher than the rate of growth of income. Income on the other hand is limited and often grows at a much lower rate than the needs. Consequently it is difficult to save.

There are various savings options available in the market; however most of the options are short-term or medium term. Life Insurance savings plans are a better choice as in addition to providing the vehicle to save for long term the plans also offer insurance on the savings.

33

Income does not increase with every requirement for finance. Childrens education, marriage, housing etc. require lump sum amounts. In case any person has a responsibility to spend on these kinds of long-term events, he would have a need for the product.

Features of the Endowment Assurance Plan

The following are the features of the plan:

1. Benefits:
a) Death Benefits: In the event of death of the life assured during the term of the contract, and provided all the premiums are paid till the time of the death of the life assured, the sum assured, together with reversionary bonus and the terminal bonuses (if any) would be paid to the beneficiary. The policy would terminate on payment of the death benefit. b) Maturity Benefits: On survival of the life assured till the date of maturity, and subject payment of all premiums, the policyholder would be paid the sum assured, together with the reversionary bonuses and terminal bonus (if any). The policy would terminate on payment of the maturity benefit.

c) Paid-up Benefits: In case the policyholder discontinues payment of premium after the premiums are paid for at least three years, the policy would be reduced to a paid-up policy. The reduced paid-up benefits are payable on death

34

of the life assured during the term, or survival of he life assured till the date of maturity, whichever is earlier. d) Surrender Benefits: The policyholder can surrender the policy at any time. In case the policyholder chooses to surrender the policy before the payment of three years premium the surrender value would be equal to zero and nothing would be payable. In case the policyholder chooses to surrender after three years, he would be entitled for a surrender value.

2. Frequency of premium payment:

The policyholder can choose yearly, half-yearly or quarterly mode of payment, as he desire. The frequency of premium payment can be altered during the term of the contract.

3. Days of grace:
The premium is payable in advance and should be paid within the days of grace. The days of grace allowed under the plan are 15 days from the due date of premium. In case the days of grace end on a holiday then the premium has to be paid on the next working day.

4. Lapsation:
In the event the premium is not paid within the days of grace the policy lapses. The policy would be automatically reduced to a paid up policy in case premiums have been paid for at least

35

three years. In case premiums are not paid for three years the policy would lapse without value. A lapsed policy can be reinstated within one year from the date of lapse only.

5. Minimum premium:
The following are the minimum premium conditions under the Endowment Assurance Plan. Annual mode Quarterly mode Rs. 1800 Rs. 550 Half yearly mode Rs. 1000 There is no condition of maximum premium.

6. Other conditions:
Minimum Term Maximum Term 10 years 30 years

Minimum Age at Entry 12 years Maximum Age at Entry 60 years Maximum Maturity Age 75 years The policyholder has the choice to choose any term between 10 to 30 years, subject to the maximum maturity age. In case the policy is taken on the life of a minor then the legal guardian of the minor would have to propose the insurance on behalf of the

minor. The policy would automatically vest in the life assured

when he attains the age of majority.

7. Policy loans:
Policy loans would be available under the plan once the policy acquires a surrender value. The policy loans would be to the extent of 90% of the surrender value. The company would quote 36

the terms and conditions of the policy loans at the time of granting the loans and the same would vary from time to time.

8. Life cover basis:

The endowment assurance plan can be offered on a single life basis or as joint life first claim basis. When the policy is offered on a joint life basis the death claim would be paid on the death of any one of the lives assured and the policy would terminate.

9. Tax benefits:
The premium paid under the plan qualifies for tax rebate under section 88 of the Income Tax Act 1961. The claim benefits would also not be taxable as per section 1010 D of the Income Tax Act 1961. The plan is also approved under the provisions of section 80 DD of the Income Tax Act 1961.

Positioning of the Endowment Assurance Plan

The Endowment Assurance Plan can be positioned as along term savings vehicle with a cover on the savings. The plan is suited to help in building a fund for long term financial needs. The guarantees in the nature of sum assured and the bonuses assure the client of a smoothened long-term return. The philosophy and practices of the company can help in building the maturity values for the client and hence positioning the company is also important in the sale of the Endowment Assurance Plan.

2. Money Back Plan

Plan with periodic survival benefits

37

Introduction
The Money Back Plan is a with profits savings contract which in addition to the payment of periodic survival benefits aims to give good maturity values to the client by investing of funds as per the IRDA guidelines and reducing claims and costs. The aim of the plan is to pay periodic survival benefits and build good maturity values so that the short term, medium term and long-term savings objectives of the policyholders are met. The net returns to the policyholders at the time of maturity would depend on the investment and cost experience during the term of the contract.

Need for the Plan

The Money Back Plan is designed to provide a solution for the shortterm, medium term and long term financial needs. It is therefore important to understand the financial needs before suggesting the plan as a solution. Since people have some short term and medium term and medium term financial goals like providing for a vacation, purchasing of a luxury item or house renovations etc, they require money periodically in short intervals to meet these goals. The Money Back Plan is designed to provide money periodically so that the same can be used for such requirements. The added advantage of the Money Back Plan is that the risk cover keeps on adjusting during the term of the contract and the policyholder is assured payment of

38

the full sum assured together with the bonuses irrespective of the survival benefits paid on death of the life assured during the term.

Features of the Money Back Plan

The following are the features of the plan:
1. Benefits: a. Death Benefits: In the event of death of the life assured during the term of the contract, and provided all the premiums are paid till the time of the death of the life assured, the sum assured, together with reversionary bonus and the terminal bonuses (if any) would be paid to the beneficiary.

b. Survival Benefits: Survival benefits are paid at the end of every fifth year on survival of the life assured. The rates of survival benefits are given below. The policy would continue after payment of the survival benefit.

39

Number of years from the policy commencement date Policy Term 10 15 20 25 30 5 40% 30% 25% 20% 15% 10 30% 25% 20% 15% 25% 20% 15% 20% 15% 15% 15 20 25

c. Surv c. Maturity Benefits: On survival of the life assured till the date of maturity, and subject payment of all premiums, the policyholder would be paid the sum assured, together with the reversionary bonuses and terminal bonus (if any) less all survival benefits paid during the term of the contract. The policy would terminate on payment of the maturity benefit. d. Paid-up Benefits: In case the policyholder discontinues payment of premium after the premiums are paid for at least three years, the policy would be reduced to a paid-up policy. The reduced paid-up benefits are payable on death of the life assured during the term.

40

e. Surrender Benefits: The policyholder can surrender the policy at any time. In case the policyholder chooses to surrender the policy before the payment of three years premium the surrender value would be equal to zero and nothing would be payable. 2. Frequency of premium payment: The policyholder can choose yearly, half-yearly or quarterly mode of payment, as he desire. The frequency of premium payment can be altered during the term of the contract. 3. Days of grace: The premium is payable in advance and should be paid within the days of grace. The days of grace allowed under the plan are 15 days from the due date of premium. In case the days of grace end on a holiday then the premium has to be paid on the next working day. 4. Lapsation: In the event the premium is not paid within the days of grace the policy lapses. The policy would be automatically reduced to a paid up policy in case premiums have been paid for at least three years. In case premiums are not paid for three years the policy would lapse without value. A lapsed policy can be reinstated within one year from the date of lapse only. 5. Minimum premium: The following are the minimum premium conditions under the Money Back Plan.

41

Annual mode Quarterly mode

Rs. 1800 Rs. 550

Half yearly mode Rs. 1000

There is no condition of maximum premium. 6. Other conditions:

Minimum Term Maximum Term Minimum Age at Entry Maximum Age at Entry Maximum Maturity Age

10 years 30 years 12 years 60 years 75 years

The policyholder has the choice to choose any term between 10 to 30 years, subject to the maximum maturity age. In case the policy is taken on the life of a minor then the legal guardian of the minor would have to propose the insurance on behalf of the minor. The policy would automatically vest in the life assured when he attains the age of majority. 7. Policy loans: Policy loans would be available under the plan once the policy acquires a surrender value. The policy loans would be to the extent of 90% of the surrender value. The company would quote the terms and conditions of the policy loans at the time of granting the loans and the same would vary from time to time.

8. Life cover basis:

42

The Money Back Plan can be offered on a single life basis or as joint life first claim basis. When the policy is offered on a joint life basis the death claim would be paid on the death of any one of the lives assured and the policy would terminate. 9. Tax benefits: The premium paid under the plan qualifies for tax rebate under section 88 of the Income Tax Act 1961. The claim benefits would also not be taxable as per section 1010 D of the Income Tax Act 1961. The plan is also approved under the provisions of section 80 DD of the Income Tax Act 1961.

3.

Childrens Plan

Plan designed for the benefit of children Introduction

43

The Childrens Plan is a with-profits savings contract designed for the benefit of the child. The plan therefore has a provision for a beneficiary, which can be the child, and all benefits under the plan would be paid to the child. The funds generated under the plan are invested as per the IRDA guidelines. The net returns would depend on our investment and cost experience during the term of the contract

Need for the Plan

Most parents feel that it is their responsibility to provide the best for their children. In addition to the physical and emotional wants children also need to be provided for financially. There are two types of financial needs of the child: I. Short term financial needs for food, clothing shelter and education. This need is mostly met from the income of the parent II. Long term financial need for higher education, marriage and start in life. The alternatives for this are either to save or raise loans. In the event of an early death of the parent the child become dependent of one of the close relative. To ensure that the child would be taken care even after such an eventuality the parent can look at providing an income as well as lump sum amounts for the benefit of the child. The Childrens Plan is designed to help the parent in planning for the above financial needs of the child.

44

All the arguments on the need to save and savings being a better option than raising a loan are applicable while selling the Childrens Plan.

Features of the Childrens Plan The following are the features of the plan: 1. Benefits:
a) Death Benefit: Under this option on death of the life assured during the term of the policy, provided the premium is paid till the date of death; no amount would be immediately payable. The future premiums would be waived and at maturity date of the policy the full sum assured with the reversionary bonuses and terminal bonus (if any) would be payable to the beneficiary. The policy would participate in the bonuses till the date of maturity. The policy would terminate on the payment to beneficiary. b) Accelerated Benefit: Under this option on death of the life assured during the tem of the policy, provided the premium is paid till the date of death, the sum assured with the reversionary bonus and terminal bonus (if any) would be payable immediately to the beneficiary and the policy would terminate.

c) Double Benefits: Under this option on death of the life assured during the term of the policy, provided the premium is paid till the date of death; one sum assured

45

would be paid to the beneficiary immediately. The future premiums would be waived and at maturity date of the policy the full sum assured with the reversionary bonus and terminal bonus (if any) would be payable to the beneficiary. The policy would terminate on payment of the benefit on the date of maturity d) Maturity Benefits: In the event of survival of the life assured during the term of the contract, and provided all the premiums are paid, the sum assured, together with the reversionary bonuses and the terminal bonuses (if any) would be paid to the beneficiary. The policy would terminate on payment of the maturity benefit. e) Paid-up Benefits: In case the policyholder discontinues payment of premium after the premiums are paid for at least three years, the policy would be reduced to a paid-up policy. If the Childrens Plan is made paid up, a table of adjustment factors will be used to adjust the policys basic sum assured to a paid up value. The adjustment factors will vary by the policyholders age, the policys original term, policy duration, and frequency. f) Surrender Benefits: The policyholder can surrender the policy at any time. In case the policyholder chooses to surrender the policy before the payment of three years premium the surrender value would be equal to zero and nothing would be payable. In case the entitled for a surrender value.

46

2. Frequency of premium payment: The policyholder can choose yearly, half-yearly or quarterly mode of payment, as he desire. The frequency of premium payment can be altered during the term of the contract. 3. Days of grace: The premium is payable in advance and should be paid within the days of grace. The days of grace allowed under the plan are 15 days from the due date of premium. In case the days of grace end on a holiday then the premium has to be paid on the next working day. 4. Lapsation: In the event the premium is not paid within the days of grace the policy lapses. The policy would be automatically reduced to a paid up policy in case premiums have been paid for at least three years. In case premiums are not paid for three years the policy would lapse without value. A lapsed policy can be reinstated within one year from the date of lapse only.

47

5. Minimum premium:

The following are the minimum premium conditions under the Childrens Plan.
Annual mode Quarterly mode Rs. 1800 Rs. 550 Half yearly mode Rs. 1000 There is no condition of maximum premium. 6. Other conditions: Minimum Term Maximum Term 10 years 25 years

Minimum Age at Entry 18 years Maximum Age at Entry 60 years Maximum Maturity Age 75 years The policyholder has the choice to choose any term between 10 to 25 years, subject to the maximum maturity age. In case the policy is taken on the life of a minor then the legal guardian of the minor would have to propose the insurance on behalf of the minor. 7. Policy loans: Policy loans would not be available under the plan.

48

8. Life cover basis: The Childrens Plan is to be sold on the life of the parent with the child as the beneficiary. The plan is not offered on a joint life basis. 9. Tax benefits: The premium paid under the plan qualifies for tax rebate under section 88 of the Income Tax Act 1961. The claim benefits would also not be taxable as per section 1010 D of the Income Tax Act 1961. The plan is also approved under the provisions of section 80 DD of the Income Tax Act 1961.

Positioning of the Childrens Plan

The Childrens Plan can be positioned as a long term savings vehicle specially designed to meet the financial requirements of the child. The plan provides for both the immediate financial needs and the long term financial needs. In case the client is not worried about the immediate financial needs of the child on his death then the maturity benefit option would be suitable to him. The sum assured payable on the death in a double benefit option would help in providing for the immediate financial needs of the child. The Accelerated benefit works exactly like and endowment assurance plan. The guardian of the child would have an option of either to spend the money for the immediate benefit of the child or to save the claim amount for a future benefit.

49

4.

Term Assurance Plan

Protection of Income Introduction

The Term Assurance Plan is a without profits protection contract designed to protect the income earning capacity of the life assured. The present earning capacity of the client therefore forms the basis of the insurance.

Need for the Plan

Uncertainty is a part of life. In the event of death of the breadwinner the dependents are put to a lot of financial difficulty as they lose the source of income. The problem is compounded in case the family does not have savings to rely on. In case a person has dependents and also does not have savings on which the family can rely on in the event of his death, he needs to protect his income for the benefit of the family. Term Assurance Plan is designed to offer the protection of the income at the least possible cost. Term Assurance Plan can also be used to cover liabilities so that in the event of death the family receives a lump sum amount so that liabilities are paid off. Term Assurance is an insurance of income and hence the existence of liabilities is not the basis of granting the insurance.

50

Features of the Term Assurance Plan

The following are the features of the plan:

1. Benefits:
a) Death Benefits: Provided the policy is in force in the event of death of the life assured during the term of the contract the sum assured is paid. b) Benefits on expiry of the cover : On expiry of the cover nothing is payable as Term Assurance is designed for protection only. c) Paid up Benefits: There are no paid up benefits under this plan. d) Surrender Benefits: There are no surrender benefits under this plan.

51

2.

Frequency of premium payment:

The policyholder can choose to pay by a single premium or yearly, half-yearly or quarterly mode of payment. The frequency of premium payment can be altered during the term of the contract. Please note that a regular premium policy cannot be changed to a single premium mode during the term of the contract.

3.

Days of grace:
The premium is payable in advance and should be paid within the days of grace. The days of grace allowed under the plan are 15 days from the due date of premium.

4.

Lapsation:
In the event the premium is not paid within the days of grace the policy lapses. A lapsed policy can be reinstated within one year from the date of lapse only.

5. Minimum premium:
The following are the minimum premium conditions under the Term Assurance Plan.
Single Premium Annual mode Quarterly mode Rs. 2000 Rs. 1500 Rs. 450

Half yearly mode Rs. 800 There is no condition of maximum premium.

6. Other conditions:
Regular Premium 52 Single Premium

Minimum Term Maximum Term Minimum Age at Entry Maximum Age at Entry Maximum Maturity Age

5 years 30 years 18 years 60 years 65 years

2 years 15 years 18 years 60 years 65 years

7. Policy loans:
Policy loans would not be available under the plan.

8. Life cover basis:

The Term Assurance Plan can be sold on a single life or joint life first death basis.

9. Tax benefits:
The premium paid under the plan qualifies for tax rebate under section 88 of the Income Tax Act 1961. The claim benefits would also not be taxable as per section 1010 D of the Income Tax Act 1961. 10. Special Rates for Women: Since women have a lesser mortality rate than men for the same age, the premium rate charged fro women would be the rate applicable to men three years younger.

53

5.

Loan Cover Term Assurance Plan

Protection of Loans Introduction

The Loan Cover Term Assurance Plan is a without profits decreasing cover protection contract designed to protect the outstanding loans of the life assured. The plan is designed to cover loans however the plan will be granted only in case the client has sufficient income to back the insurance.

Need for the Plan

Uncertainty is a part of life. In the event of death of the breadwinner the dependents are put to a lot of financial difficulty as they lose the source of income. The problem is compounded in case there are outstanding loans. The Loan Cover Term Assurance Plan is designed to cover outstanding loans at the least possible cost.

Features of the Loan Cover Term Assurance Plan

The following are the features of the plan:
54

1. Benefits:
a) Death Benefits: Provided the policy is in force in the
event of death of the life assured during the term of the contract the sum assured is paid.

b) Benefits on expiry of the cover : On expiry of the cover

nothing is payable as the Loan Cover Term Assurance is designed for protection only.

c) Paid up Benefits: There are no paid up benefits under

this plan.

d) Surrender Benefits: There are no surrender benefits

under this plan.

2.

Frequency of premium payment:

The policyholder can choose to pay by a single premium or yearly, half-yearly or quarterly mode of payment. The frequency of premium payment can be altered during the term of the contract.

3.

Days of grace:
The premium is payable in advance and should be paid within the days of grace. The days of grace allowed under the plan are 15 days from the due date of premium. In case the days of grace end on a holiday then the premium has to be paid on the next working day.

4.

Lapsation:

55

In the event the premium is not paid within the days of grace the policy lapses. A lapsed policy can be reinstated within one year from the date of lapse only.

5. Minimum premium:
The following are the minimum premium conditions under the Loan Cover Term Assurance Plan.
Single Premium Annual mode Quarterly mode Rs. 2000 Rs. 1500 Rs. 450

Half yearly mode Rs. 800 There is no condition of maximum premium.

56

6. Other conditions:
Regular Premium Premium Minimum Term Maximum Term Minimum Age at Entry Maximum Age at Entry Maximum Maturity Age 5 years 30 years 18 years 60 years 65 years 18 years 60 years 65 years 2 years 15 years Single

7. Policy loans:
Policy loans would not be available under the plan.

8. Life cover basis:

The Term Assurance Plan can be sold on a single life or joint life first death basis.

9. Tax benefits:
The premium paid under the plan qualifies for tax rebate under section 88 of the Income Tax Act 1961. The claim benefits would also not be taxable as per section 1010 D of the Income Tax Act 1961.

57

10. Special Rates for Women:

Since women have a lesser mortality rate than men for the same age, the premium rate charged fro women would be the rate applicable to men three years younger.

Important
Although the plan is named as Loan Cover Term Assurance Plan the plan is basically a decreasing cover term assurance. The plan is not linked to a loan and the client can choose to purchase this plan even in case he does not have a loan. The sum assured would decrease at a predetermined rate and is not linked to the decrease in the loan amount. Care has been taken to ensure that the sum assured would be sufficient to pay most of the loans. The plan does not guarantee payment of the outstanding loan.

6.

Single Premium Whole of Life Insurance

Plan
Plan designed to give long-term real growth Introduction

58

The Single Premium Whole of Life Insurance Plan is a with profits investment contract which aims to give long tem real growth to the client by investing the funds as per the IRDA guidelines and reducing claims and costs. The aim of the plan is to generate long term real growth, providing guarantees at specific times during the term of the contract.

Need for the Plan

The Single Premium Whole of Life Insurance Plan is designed to help the client in long-term investment. It is therefore important to understand the problems associated with investments to sell the plan better. However all investment is associated with risk. The higher the risk one takes, the better the chances of getting a better return. Investment is all about taking risks. Various investment instruments are available in the market and the client has to choose from the investment option available. This investment instruments are designed to meet short-term, mediumterm and long-term objectives. If an instrument is designed for a short

term the same is not suitable for ac hieving a long term

objectives. This is because the instrument would terminate in the short term and the client would be exposed to reinvestment risks. Long-term investments designed to provide real growth is a solution to the longterm needs. The client can choose to invest directly where the risks are high and the potential of a higher return also exists. However he would have the disadvantage of being a small investor, who does not have the

59

expertise in the market, does not have large funds and is not able to diversify. The mutual funds help the client in this area and pool the investment of a group of small investors providing them with expertise in investment, diversification and better returns. However investment in mutual fund requires a strategy and the returns depend on the time of entry and exit from the fund. Two investors may make different kinds of return due to the different strategies they follow. The Single Premium Whole of Life Insurance Plan is designed to remove this problem of the investors by giving insurance in the form of guarantees on death and at specific time intervals so that the returns at these guaranteed periods do not depend on the market conditions. These guarantees in long-term investment are very valuable and since the product is a whole of life one, the client can continue with the investment till death.

60

Features of the Single Premium Whole of Life Insurance Plan

The following are the features of the plan: 1. Benefits:
a) Death Benefits: In the event of death of the life assured during the term of the contract, and provided all the premiums are paid till the time of the death of the life assured, the sum assured, together with the (compound) reversionary bonus and the terminal bonuses (if any) would be paid to the beneficiary. The policy would terminate on payment of the death benefit. b) Maturity Benefits: The Single Premium Whole of Life Insurance Plan is a whole life plan and therefore does not have a maturity date. c) Paid up Benefits: This is not applicable to the Single Premium Whole of Life Insurance Plan since the plan is a single premium plan. d) Minimum

Guaranteed

Surrender

Benefits:

On

surrender of the policy after a period of three years from the date of commencement, there is and guarantee that the minimum surrender value would be equal to 50% of the premium paid, except in the four weeks immediately following the completion of the 10 th minimum guaranteed surrender value would be equal to the sum assured.

61

2. Frequency of premium payment:

The policyholder has to pay the premium by way of a single premium only. The single premium payable is equal to 95% of the sum assured chosen.

3. Premium:
The following are the premium conditions under the Single Premium Whole of Life Insurance Plan:
Minimum Premium Maximum Premium Rs. 23,750 Rs. 47, 50,000

4. Other conditions:
Minimum Sum Assured Rs. 25,000 Maximum Sum Assured Rs. 50,00,000 Minimum Age at Entry 18 years Maximum Age at Entry 70 years

5. Policy loans:
Policy loans would be available under the plan once the policy acquires a surrender value. The policy loans would be to the extent of 90% of the surrender value. The company would quote the terms and conditions of the policy loans at the time of granting the loans and the same would vary from time to time.

6. Life cover basis:

The Single Premium Whole of Life Insurance Plan can be offered on a single life basis only.

7. Tax Benefits:
62

The Premium paid under the plan qualifies for tax rebate under section 88 of the Income Tax Act 1961. The plan is also approved under the provisions of section 80 DD of the Income Tax Act 1961.

Positioning of the Single Premium Whole of Life Insurance Plan

The Single Premium Whole of Life Insurance Plan can be positioned as along term investment vehicle with guarantees at specific dates. The Plan is suited to help in providing a fund for long term financial needs. The philosophy and practices of the company can help in building the policy values for the client and hence positioning the company is also important in the sale of the Single Premium Whole of Life Insurance Plan.

7.

Personal Pension Plan

Savings for a better retirement Introduction

The Personal Pension Plan is a with profits deferred pension contract which aims to give good pension benefits to the client by helping the client build a retirement fund. The aim of the plan is to build good fund values so that the client can enjoy a better pension on retirement.

63

Need for the Plan

Income in retirement is becoming more and more important. With the breakup of the joint family system and the increase in longevity, it is becoming more and more important to provide for retirement. The fall in the interest rates and the uncertainty prevailing in the market make pensions more attractive. Pension can provide a guaranteed income till death and hence there is a renewed interest in pension schemes in the recent years. It is important that the person plans for his retirement. The planning should start early so that the person contributes lesser amounts and there is time for the fund to grow. For retirement there is only one option for the person and that is to save. One cannot raise a loan for retirement.

64

There are various instruments of savings and investment, which the client can use to provide for his retirement. A deferred pension plan has the following advantages:
I. The deferred pension plan can be issued for long terms so that the single instrument covers the retirement need of the client. II. The deferred pension plan automatically vests in the life assured on the date of vesting. This is an advantage as the likelihood that the fund would be used for some other purposes is minimized and fund would be used only for retirement. III. Special tax benefits are available for investment in deferred pension plans.

Features of the Personal Pension Plan The following are the features of the plan: 1. Benefits:
a) Death Benefits: In the event of death of the life assured during the term of the contract the following amount would be payable: i. In the event of the death of the life assured in the first year then 90% of the premium paid would be payable in case of single premium policies and 80% of the premium paid would be payable in case of regular premium policies.

65

ii.

In the event of the life assured after the first year Sum assured plus reversionary bonus

attached would be payable under single premium policies. Lower of the sum assured plus reversionary bonus and return of premium paid with interest of 8% is payable, under regular premium policies. b) Benefits at Vesting: On the vesting date, provided the policy is in full force the Notional Cash Value (NCV) would be used to pay the following: i. Cash lump sum to the extent permitted by the regulations at the time of vesting. The policyholder may choose either to take the cash lump sum or use the full NCV to purchase an annuity. ii. Purchase of an immediate annuity as per the choice of the policyholder. In case the policyholder has opted for the cash lump sum the balance NCV would be used to purchase the annuity. In case the policyholder has not opted for the cash lump sum then the full NCV would be used to purchase the annuity.

66

c) Paid up Benefits: In case the policyholder discontinues payment of premium after the premiums are paid for at least three years, the policy would be reduced to a paid-up policy. The reduced paid up benefits would form the Notional Cash Value on the date of vesting of the policy. The paid up policy will not participate in future bonuses. d) Surrender Benefits: The policyholder can surrender the policy at any time. In case the policyholder chooses to surrender the policy before the payment of three years premium the surrender value would be equal to zero and nothing would be payable. In case the policyholder chooses to surrender after three years, he would be entitled for a surrender value.

2. Frequency of premium payment:

The policyholder can choose to pay single premium or regular premium by yearly, half-yearly or quarterly mode. The frequency of premium payment can be altered during the term of the contract.

3. Days of grace:
The premium is payable in advance and should be paid within the days of grace. The days of grace allowed under the plan are 15 days from the due date of premium. In case the days of grace end on a holiday then the premium has to be paid on the next working day.

67

4. Lapsation:
In the event the premium is not paid within the days of grace the policy lapses. The policy would be automatically reduced to a paid up policy in case premiums have been paid for at least three years. In case premiums are not paid for three years the policy would lapse without value. A lapsed policy can be reinstated within one year from the date of lapse only.

5. Minimum premium:
The following are the minimum premium conditions under the Personal Pension Plan.
Single Premium Annual mode Quarterly mode Rs. 25000 Rs. 2400 Rs. 700

Half yearly mode Rs. 1300

6. Maximum premium:
The following are the maximum premium conditions under the Personal Pension Plan.
Single Premium Annual mode Quarterly mode Rs. 50, 00,000 Rs. 50, 00,000 Rs. 12, 50,000

Half yearly mode Rs. 25, 00,000

7. Other conditions:

68

Minimum Term Maximum Term

10 years 40 years

Minimum Age at Entry 18 years Maximum Age at Entry 60 years Minimum Vesting Age 50 years Maximum Vesting Age 70 years The policyholder has the choice to choose any term between 10 to 40 years, subject to the minimum and maximum vesting age.

8. Policy loans:
Policy loans would not be available under the plan.

9. Life cover basis:

The Personal Pension Plan can be offered on a single life basis only.

10. Tax benefits:

The premium paid under the plan qualifies for tax deductions under section 80CCC of the Income Tax Act 1961. The cash lump sum received at the date of vesting is tax free under section 1010a (iii) of the Income Tax Act 1961. Surrender value during the deferment period would be taxable as per section 80CCC of the Income Tax Act. Similarly pensions received after vesting would be taxable in the hands of the life assured.

69

SWOT ANALYSIS
Strengths:
Country Wide Recognition Need Base Analysis Same Standard Services in all Branches Fair Deal in all Transactions Customers Centric Approach Infrastructure

Weakness:
Frequent Job Rotation Less number of advertisements Hidden Charges

Opportunities:
Scope in Jaipur as it is in the developing phase Only 25% of insurable people have any insurance Higher possibility of growth in Indian share Market

Threats:
LICs Brand Name People of Jaipur prefer short-term investment rather than in insurance Upcoming private insurance companies.

70

71

FINDINGS & SUGESSTIONS

FINDINGS:

1. In HDFC SL I feel that Insurance sector is one of the most growing sectors among all sectors in India. 2. I also find that HDFC Standard Lifes Traditional Plans are very useful for a normal person. 3. Jaipur is one of the most growing city and there is lot of scope of insurance. 4. Most of the people are aware of traditional plans. 5. Electronic media has proved to be very beneficial for people to understand about the insurance. 6. There is lot of opportunities for young and energetic people in HDFC SL to build there sound career. STRENGTH Country Wide 7. HDFC Standard Lifes traditional plans like children plan, one of the Recognition most popular products Need Baseof the company. Analysis Same Standard Services in all Branches Fair Deal in all Transactions Customers 72 Centric Approach Infrastructure

SUGESSTIONS:

1) Use of creative advertisements to attract more and more target customers and to create awareness among them. 2) HDFC SL should chalk out some programs to create general awareness regarding its presence and various services of the company. 3) Today is the era of competition. In order to increase the company network (In terms of clients and business volumes) an aggressive approach is required. 4) HDFC SL should try to make its promotional activities more effectively.

5) HDFC Standard Life Company should regularly conduct market research and surveys for knowing customers better and for facing threat from competitors.

QUESTIONNAIRE

73

To get a better insight about the advisor's satisfaction level the various improvements to be done in the HDFC Standard Life Insurance product.
Name: Age: Tel no: Qualification: Profession:

Ql. For how long are you working with HDFC Standard Life
Insurance?

o Less than 1 yr. o l-2yr.

o 2-3 yr. o More than 3 yrs. Q2. How many products have you sold as an advisor? o Less than 10. o 10-20 o 20-30 o More than 30

Q3. What is the purpose of buying an insurance product by Customers? o Tax benefit

74

o Investment o Security o Any other Q4. Products which are sold most? o Unit Jink plan o Smart kit plan o Annuity plan Q5. Products which are sold least? o Term plan o Endowments plan o Group insurance Q6. Rate the products of HDFC Standard Life Insurance in comparison to its Competitors? (Best = 4 pts Good = 3 pts Average = 2 pts Poor = 1 pt) o Best o Good o Average o Poor Q7. Which company do you think the best products available?

75

Q8. What motivates you to stay in this business? o Money o Recognition o Motivation by the co./UM o Any other Q9. Are you satisfied with the commission provided by the co.? o Yes o No If no, then why_______ Q10. Are you satisfied with the facilities provided by the co. to it's a Advisors in comparison to other players? o Yes o No If no, then why_^_ ^__ Q. l1. HDFC Standard Life Insurance how to better other Companies? o Commission o Recognition o Better Products

76

CONCLUSION
HDFC is the leading insurance service providers to public and private sector. HDFC Standard Life is the first private insurance company which got license in 2000 from IRDA. Life Insurance in India has a huge potential for growth. Statistics reveal that only 25% of the insurable population in India is insured. And those insured are in need of still higher insurance cover. The cover 100% growth displayed by private life insurers indicates this huge untapped potential. Traditional plans like children plan gives invaluable support to your child, Term Assurance Plan gives help secure your family financial needs, Money Back Plan gives a wide range of terms and cash benefit schedules to choose from, Personal Pension Plan is designed to provide a post retirement income for life with the freedom to choose the retirement date, Single Premium Whole of Life Insurance Plan is a tailor-made plan well suited to meet your long-term investment needs, Endowment Assurance Plan is designed to provide a solution to the long term financial needs, Loan Cover Term Assurance Plan is STRENGTH designed to cover Wide outstanding loans at the least possible Country Recognition cost. At last we Analysis can conclude that HDFC SL provides best solutions to Services its customers by giving them best value of in all their money.Branches
Fair Deal in all Transactions Customers Centric Approach Infrastructure 77 Same Standard Need Base

BIBLIOGRAPHY
C. R. Kothari: Research Methodology Philip Kotler: Marketing Management Fact sheets of: HDFC Standard Life Company
Websites

www.google.com (search engine) www.yahoo.com (search engine) www.wikipedia.com www.hdfcinsurance.com www.hdfc.com

Newspapers Economics Times Times of India Magazines STRENGTH Business Today
Country Wide Recognition Business World Need Base Analysis Same Standard Services in all Branches Fair Deal in all Transactions Customers Centric Approach Infrastructure

78