ULIP

PRODUCTS

Group members:-
Anupama Kumari (09FC011)
Nutan Kumari (09FC012)
Indraneel Choudhury (09FC041)
 INTRODUCTION
INSURANCE

LIFE NON-LIFE
INSURANCE INSURANCE

TRADITIONAL ULIP

MAIN DIFFERENCE BETWEEN TRADITIONAL AND ULIP PLANS:

1. Risk on investment
2. Premium amount
HISTORY OF ULIP

 Ulip came into play in 1960 and is popular in many countries in the
world today.

 In 1971 the unit trust of India offered the unit linked insurance
plan. Out of insurance premium a small part of contribution was
utilized for providing life cover and balance invested in units.

 Unit linked guidelines notified by IRDA on 21st December, 2005 in

India. The main intent of the guidelines was to ensure that they lead
to greater transparency and understanding of these products among
the insured, especially since the investment risk is borne by the
policyholder.
ABOUT ULIP
 A product in combination of investment plus
life-insurance coverage financial product.

 What is an unit ??

 Features of ULIP:-
1. Life Protection
2. Investment and savings
3. Adjustable life cover
4. Investment option
5. Options to take additional riders
CONTD…
 Transparency
 Flexibility

 Tax planning

Types of ULIPs:-
1. ULIP-1

2. ULIP-2

Guranted return ULIPs:-

3. Pension Plan

4. Annuity Plan
TYPES OF ULIP FUNDS

 Liquid / Cash Fund (low risk)

 Bond Fund (medium risk)

 Balance Fund (medium risk)

 Equity Fund (high risk)

 Mid-cap Fund (medium risk)

 Income & Fixed Interest (low risk)

CHARGES INCLUDED WITH THE
PRODUCT..
 Mortality charges
 Sales and administration charges

 Fund management charges

 Switching charges

 Top-up charges

 Cancellation charges

What is NAV ??
Value of a fund in a particular day or tenure.
 NAV (NET ASSET VALUE)

The investment is denoted as units and is represented by

the value that it has attained at that point of time .This is
known as net asset value (NAV).
For example : an investor had invested rs.10,000/- in a
unit linked plan and the NAV at the time of investment
was rs.10/- then the number of units held by the investor
will be
= 10,000/10
=1000 UNITS
 NAV (NET ASSET VALUE)

The basis used for calculation of NAV would be the appropriation

price and expropriation price.

The appropriation price shall apply in a situation when the

company is required to purchase the assets to allocate the units at
the valuation date

The expropriation price shall apply in a situation when the

company is required to sell assets to redeem the units at the
valuation date.
The NAV per unit of each investment fund will be calculated as per the
prevailing IRDA guidelines mentioned below
When appropriation price is applied: the NAV shall be computed as:
Market value of investments held by the fund +
The expenses incurred in purchase of the assets +
Value of any current assets +
Any accrued income net of fund management charges (-)
Value of any current liabilities (-)
Provisions (if any)
Total is then Divided by the number of units existing at valuation date
(before any new units are allocated)
When expropriation price is applied: the NAV shall be computed as:
Market value of investments held by the fund (-)
The expenses incurred in sale of the assets +
Value of any current assets +
Any accrued income net of fund management charges (-)
Value of any current liabilities (-)
Provisions (if any)
Total is then Divided by the number of units existing at valuation date
(before any new units are allocated)
THE COMMON TYPES OF FUNDS AVAILABLE ALONG
WITH AN INDICATION OF THEIR RISK
CHARACTERISTICS

GENERAL DESCRIPTION NATURE OF INVESTMENTS RISK CATEGORY

EQUITY FUNDS PRIMARILY INVESTED MEDIUM TO

IN COMPANY STOCKS HIGH
WITH THE GENERAL AIM OF
CAPITAL APPRECIATION
INCOME, FIXED INTEREST INVESTED IN MEDIUM
AND BOND FUNDS CORPORATE BONDS,
GOVT SECURITIES
AND OTHER FIXED INCOME
INSTRUMENTS
CASH FUNDS SOMETIMES KNOWN AS LOW
MONEY MARKET FUNDS —
INVESTED IN CASH, BANK
DEPOSITS AND MONEY
MARKET INSTRUMENTS
BALANCED FUNDS COMBINING EQUITY MEDIUM
INVESTMENT WITH FIXED
INTEREST INSTRUMENTS
FOR EXAMPLE:- BIRLA LIFE INSURANCE
GOLD PLUS II…
Investment Risk Asset Allocation * Min. Max.
Fund Profile
Option
Assure Very Low Debt Instruments, Money Market & Cash 100% 100%
Equities & Equity Related Securities 0% 0%
Protector Low Debt Instruments, Money Market & Cash 90% 100%
Equities & Equity Related Securities 0% 10%
Builder Low Debt Instruments, Money Market & Cash 80% 90%
Equities & Equity Related Securities 10% 20%
Enhancer Medium Debt Instruments, Money Market & Cash 65% 80%
Equities & Equity Related Securities 20% 35%
Creator Medium Debt Instruments, Money Market & Cash 50% 70%
Equities & Equity Related Securities 30% 50%
Magnifier High Debt Instruments, Money Market & Cash 10% 50%
Equities & Equity Related Securities 50% 90%
Maximiser High Debt Instruments, Money Market & Cash 0% 20%
Equities & Equity Related Securities 80% 100%
 MUTUAL FUNDS V/S ULIP
PARTICULARS MUTUAL FUND
Contribution Purely Voluntary. You need not follow
any discipline in investing. Generally
people do not invest regularly – they
invest when the market is high and want
to disinvest when the market is low.
Switches You can switch anytime from one scheme
to another. These switches are subject to
capital gains tax.
Flexibility SIP Cannot be altered
Portfolio Disclosure Mandatory
Surrender of Policy You can surrender anytime
Life Insurance There is no life insurance cover.
Cover
Tax Benefits Section 80C Tax saving Bonds
Investment in other funds are taxable.
Advise Advisable to make investments for short
term
UNIT LINKED INSURANCE
Compulsory Savings. You save
regularly and invest through the
highs and lows in the market.
You can switch anytime from
one scheme to another. These
switches are tax free.
Premium can be altered
Not mandatory
You can surrender the policy
after 3 years without any
surrender charge.
You have life cover up to 5 times
/ 10 times / 20 times the
committed contribution (subject
to age constraints).
Section 80C Tax Free
Advisable to make investments for
long term 10 yrs and above
FEW OF THE MARKET LEADING PRODUCTS…

 Market Plus-1 & 2

 Health Plus

 Profit Plus

 Fortune Plus

 Aviva Child Plans

 ICICI Pru LifeTime Maxima

 ICICI Pru LifeStage Pension

 Jeevan Shree

 Jeevan Sathi

 Dhanlaxmi
CNTD…
 ICICI Pru LifeTime Pension Maxima
 ICICI Pru LifeStage Pension

 Bajaj Alliance ULIP

 Kotak Flexiplan
THANK YOU