A Report

On
MARKET POTENTIAL
IN
“LIFE INSURANCE SERVICES”

1
 PREFACE

It’s a magic mantra for the marketer. It says the customer is best satisfied
when it least expects it. Today’s highly –competitive marketplace, when mere
satisfaction does not ensure loyalty, decrees this. To take potential defectors
by surprise, you have to behind customer expectation by anticipating its need
and then surpassing them with constantly superior products or service or
delighting the customer. Nor must be delight be a one-off offering, which can
be bartered for a lifetime purchase. You must be prepared for a lifetime
purchase. You must be prepared to it again and again, increasing the level of
satisfaction at each encounter with the customer. It was in the late eighties that
corporation discovered the magic mantra: customer loyalty. In the mid
nineties the manta is being modified somewhat. Instead of merely satisfaction,
the enlightened companies have now started talking about customer loyalty.
The distinction is important increasingly research data is showing that even
customers who claim to be satisfied tend to desert a company whenever its
rival unleashes a new marketing program. And any marketing exercising that
merely aims at satisfying customers is unlikely to reap any term benefits.

Marketing’s traditional connection with customer are no longer sufficient I a

real time world focus groups, market research, consumer surveys and other
tools for probing the consumer wants and needs are and always have been

2
limited. Customer surveys must view with skepticism. By contrast, continuous
connection with customers can provide information that focus groups and
surveys cannot. A customer is rarely interested in the products per she is only
interested in what the product Cando for him. That’s why, any marketer who
can help the customer get the maximum benefits from the products stands to
gain a district competitive edge in the market place.

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 ACKNOWLEDGEMENT

I would like to express my sincere gratitude to Mr.Ankur gupta, branch officer

of (BIRLA SUN LIFE INSURANCE COMPANY LTD.), Muzaffarnagar for
giving me an opportunity to undergo this summer training in his esteemed
organization.

I also extend my sincere thanks to the employees of BIRLA SUN LIFE

INSURANCE CO. LTD. Muzaffarnagar With out their support and guidance,
this project could not be completed. Though out the project work, they had
been a constant source of motivation to me.

Lastly I would like to thank all the facility members of marketing department
of our institute who guided me to fulfill my project.

4
 STUDENT DECLERATION
STUDENT DECLARATION

I here by declared that this summer training project entitled ‘A REPORT ON

MARKET POTENTIAL IN “LIFE INSURANCE SERVICES” in NCR
region, (A CASE STUDY OF BIRILA SUN LIFE INSURANCE COMPANY
LTD.) Submitting for partial fulfillment of the requirement for the degree of
M.B.A. from U.P.TECHINICAL UNIVERSITY, LUCKNOW is of my
original work. This report is only for education purpose and not for any other
purpose.

FROM -
DIVYA SHEKHAR SINGH
DATE M.B.A (Third sem.)

5
 CONTENTS

1. PREFACE
2. ACKNOWLEDGEMENT
3. STUDENT DICLERATION
4. CERTIFICATE OF HEAD OF INSTITUTE
5. CERTIFICATE OF OFFICER OF CONCERNED ORG.

PART-1
1.0 INTRODUCTION
1.1 BRIEF HISTORY OF THE UNIT-LINKED INSURANCE
1.2 BRIEF HISTORY OF BIRLA SUN LIFE INSURANCE CO.
1.3 ORGANISATION STRUCTURE
1.4 BRIEF PROFILE OF SERVICES OF ORGANISATION
1.5 AREAS OF EXCELLENCE
1.6 GROWTH OF BSLI IN UNIT-LINKED LIFE INSURANCE
1.7 PROBLEM IN ORGANISATION
2.0 DISTRIBUTION NETWORK
3.0 PRICING POLICY OF THE COMPANY
4.0 OBJECTIVES OF THE STUDY

PART-2

5.0 RESEARCH METHODOLOGY

5.1 SAMPLING PLAN
5.2 TIME SCHEDULE

6.0 DATA COLLECTION METHOD

6.1 PRIMARY SOURCES
6.1.1 QUESTIONNAIRE

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6.1.2 SURVEY METHOD
6.1.3 INTERVIEW
6.1.4 OBSERVATION METHOD
6.2 SECONDARY DATA

7.0 TABULATION AND ANLYSIS

8.0 SWOT ANALYSIS
9.0 CONCLUSION
10.0 SUGGESTION
11.0 ANNEXURE
11.1 QUESTIONNAIRE
11.2 SURVEY FORM
11.3 ILLUSTRATION OF THE COMPANY POLICY
(All the documents that are given by the company
At the time of the policy)

12.0 BIBLOGRAPHY

7
1.0 INTRODUCTION:

1.1 BRIEF HISTORY OF UNIT- LINKED INSURANCE: The

“unit linked life insurance policy” as it is understood and practiced in
the west was introduced in our country only in 2000 when LIC brought
in to the market a policy called “BIMA PLUS”. As a data, expect two
or three new companies all the companies are selling the unit linked life
insurance policies. The term “unit” in our country is somehow
identified only with the ‘units’ sold by UNIT TRUST OF INDIA. This
product is also called “EQUITY LINKED POLICY” or “MARKET
LINKED POLICY” to indicate that the returns under these plans are
linked to the market returns of the equities or shares.

The credit of introducing the first unit linked plan goes to UTI when
they brought out the Unit linked life insurance (ULIP) in 1971,In 1989
LIC Mutual Fund introduced the ‘DhanRaksha’ Plan identified to the
ULIP. The term of the policy in either 10 or 15 years. With the effect
from 1-7-02 the target amount under these two schemes has been
introduced to Rs. 2 lakhs from Rs.75, 000.it works like this: from the
uniform contribution for each year (for example @Rs.20,000 for ten
years) a small portion is used to buy term death cover for Rs.2 lakhs
and the balance is invested in units and at the end of ten years the
accumulations made in your account is given as the maturity benefit

8
along with a 5 or7.5% bonus. There is some restriction in full death
cover in the first two years. After two years the full death benefit will
be paid equal to the target amount. a free accident cover is also given
for Rs.50,000. From April 2000 this plan is made NAV driven and UTI
has made several beneficial changes. In fact, these plans are considered
to be the cheapest insurance with good returns! As life insurance people
are not making these plans, they are not very popular in large numbers.

The concept involved in these unit or equity –linked policies is that as

the major part of your premium amounts paid over a period of years is
invested in equities and other capital market instruments year after year,
the return when it comes will not be affected very much by inflation as
it happens in a maturity value of the policy in any average life
insurance policy for the same period. Of course, the insulation against
inflation is the insulation against inflation is subject to the usual
investment risks and the investments performing reasonably well.

The idea of linking insurance benefits to the performance of units was

first tried for annuities. The annuity benefit was for a fixed number of
units, the value of which depended upon the market value of a portfolio
of equity assets. The teachers insurance and annuity association in USA
first introduced this method in 1952 to pay the annuities in
collaboration with the college retirement equity fund. The insurance
companies could not follow this method to extend the benefit to the

9
general public due to legal obstacles and funding problems till 1964. In
1959 the US supreme court ruled that such insures will be subject to the
regulation of securities and exchange commission (SEC) only in 1964
the SEC permitted insurance companies to introduce such annuities.

Each groundwork for successfully operating unit-linked life insurance

policies was first made in Holland, Netherlands, Canada and UK.

However, life insurance contracts linking to the performance of units

came only in 1976 in USA. The SEC ruled that life insurance contracts
with an equity base would be subject to the securities act of 1933-34
and investment company act 1940. The agents selling such policies
were also to take special licenses.

While it is called “Unit- linked life insurance policy” inUK it is called

“Variable insurance contracts” in USA. It is rightly called “variable”
because both the premiums and the benefits under the policy are
‘variable’ according to eh choice of the policyholder. What is paid
under the policies is the returns on the performance of the chosen
equities and not a fixed sum as in an ordinary policies. The majority of
them are whole life plans.

10
Basically, in USA, it offers the life insurance coverage combined with a
tax- differed investment feature. Your premium payment are spent on
three things:

1) The cost of the life insurance;

2) Various insurance company fees-including sales charges which are
deducted from each premium payment and
3) Your tax –deferred investment account, whatever amount is left after
the first two goes into the third. And the amount is probably a lot less
than you would hope. There are stringent regulations on selling these
policies in other countries.

For example, in USA, since the variable life insurance products

switches the investment risk from the insurance company to the policy
owner, these types of policies are considered both insurance contracts
and securities and are regulated by both the securities &exchange
commission and the state insurance commissioner. An agent authorized
to sell variable life insurance must be licensed by the state as well as by
the National Association of Securities Dealers (NASD) to work as a
registered representative.

As a security, variable insurance products are regulated by the

securities &exchange commission, which brings out a new set of agent
requirements dealing, primarily with full and fair disclosure laws. For

11
example, any sales presentation or illustration must be preceded by or
accompanied by a prospectus approved by the SEC. all materials used
in selling and the SEC must also approve promoting these product prior
to use.

In our country, however, only the IRDA regulates this policy and the
investment of the premiums collected under the policies. Also it is
enough if the selling agent has passed the basic IRDA insurance license
examination. No special qualifications are need by the agent and SEBI
does not have any control over the designing of or illustration prepared
by the insurance companies in selling such policies.

1.2 BRIEF HISTORY OF BIRLA SUN LIFE INSURANCE

COMPANY LTD.:

A joint venture between the Aditya Birla Group and Sun life Financial,
Birla sun life insurance forayed into the life insurance and retirement
planning business by pioneering the unique unit-linked solutions in
India. In just over 2 years of its launch, the company has catapulted to
second position in new business premium in the highly competitive
private life insurance industry based on its strategy of unit-linked plans.

12
1.2.1 THE ADITYA BIRLA GROUP: “Aditya Birla”, a name that evokes
all that is positive in business and life. It typifies integrity, quality,
performance, innovation, perfection and above all, character.

In operation for over 50 years now, the Aditya Birla Group is one of
India’s largest business houses. A highly respected and admired group,
rooted in performance ethics based on value creation for its multiple
stakeholders. The Aditya Birla Group’s operations span over 40 units
across 18 countries, anchored by a 72,000 strong committed workforce,
a group turnover exceeding Rs.27, 000 crore, an asset base which
exceeds Rs.20, 000 crore and a market capitalization of over Rs.13, 000
crore spread over 7 lac shareholders. Known for its rack solid
fundamentals it nurtures a culture where success does not come in the
way of the need to keep learning afresh to continue innovating and to
carry on experimenting.

Being one of the largest corporate houses in India, and Aditya Birla
Group enjoys a dominant position in all the sectors in which it operates.
It is the world’s largest producer of viscose staple fibre, largest single
location aluminum plant and the largest single location refiner of palm
oil. What’s more, it is the second largest producer of insulators and the
fifth largest producer of carbon black in the world.

13
In India, the group is the single largest producer of viscose filament
yarn, aluminum, white cement and the third largest in grey cement. Not
to mention, the recognition of being the market leader in the ready to
wear branded apparel segment with brands like Allen solly, Louis
Phillip, van heusen and peter England.

The flagship companies of the Aditya Birla Group include some of the
largest and most respected companies in India such as grasim industries
limited, Hindalco industries limited, Indian Aluminum Company
limited, Indian Rayan Industries Limited, Indo Gulf Corporation
Limited. The Group has larged power relationship with large
corporations like Hindustan Petroleum, Tata, Powergen Plc and AT&T.

The group fosters a culture that promotes excellence and rewards

entrepreneurship. It endeavors to make the workplace a source of
creativity, innovation and self-fulfillment for its employees. Nurturing a
corporate culture imbedded with a high level of commitment and a
sense of shared destiny.

The mission of the Aditya Birla Group is creation of value for its
customers, shareholders, employees and the society at large.

14
1.2.2. SUN LIFE FINANCIAL: Sun life financial is a leading international
financial services organization. With a history that dates back to 1871,
Sun life financial has evolved from a single mutual life insurance to one
of the most highly rated insurance and wealth management institution
in the world. Sun life financial knows its value lies in more than assets
and history. It also lies in the culture of the integrity and the pursuit of
excellence that have marked all of the organization endeavors. Today
the sun life financial group of comp anise and the partners are
represented globally in Canada, the United States, the Philippines,
Japan, Indonesia, India and Bermuda.

In March of 2000, Sun life financial services of Canada, inc, Sun life
financier’s parent company, listed its shares on stock markets in
Toronto, New York, London, and Philippines. This new access to
shareholders equity provides Sun life financial with even greater
opportunities to grow around the world.

The Sun life financial group of companies around the world, offer
innovative and practical financial solutions to individuals and
corporations:
 Life, Health and Disability
 Pension Funds and Plans
 Investment Management
 Annuities and Savings

15
  Trust, Brokerage and Banking

Sun life assurance Company of Canada, sun life financier’s primary

insurance business, has excellent ratings with the world’s top ratings
agencies. With assets under management as on September 30, 2000
totaling more than CDN$345 billion, it ranks amongst the largest
international financial services organizations in the world. Sun life
financial enjoys independent rating that place us at the top of the
financial sector in North America.

1.2.3 VISION: To be a world-class of financial security to individuals and

corporate and to be amongst the top three private sector life insurance
companies in India.

1.2.4 MISSION: To be the first preference of our customers by providing

innovative need based life insurance and retirement solutions to
individual as well as corporate. Well –trained professionals through a
multi channel distribution network and superior technology will make
these solutions available.

Our endeavor will be to provide constant value addition to customers

throughout their relationship with us, within the regulatory framework.

16
 We will provide career development opportunities to our employees
and the highest possible returns to our shareholders.

1.2.5. OUR VALUES:

• INTEGRITY
• TRANSPERENCY
• CUSTOMER FOCUS
• EXCELLENCE
• INNOVATION
• MERITOCRACY
• RESPECT FOR THE INDIVIDUAL

1.2.6. OUR FEATURES: Our unit-linked flexi products are based on

universal life platform, catering to the customer’s twin needs of
insurance and investment. Our customers have appreciated these
products, which have the beneficial features of life insurance, mutual
funds and banks. Some of these features are described below:

1. PROSPECTS FOR GROWTH WITH UNDERLYING GURANTEES:

According to their risk appetite, the customers can choose out of three
investment options, viz, protector (Representing a low risk portfolio),

17
 Builder (Medium risk portfolio) or Enhancer (High risk portfolio) with
guaranteed returns fund, at present ranging from 3%-6%. The flexibility
of changing the investment option initially availed by them is also
available.

2. GUARANTEES PROVIDE SAFETY NET: The policyholders enjoy the

upside returns provided by the portfolios in all the investment options.
As on 31st December 2002, the annualized returns since inception under
protector, builder and enhancer options were 9.75%, 11.12% and
14.74% respectively, which is above the minimum level guaranteed.

3. CONVENIENCE IN PAYMENT OF PREMIUMS: The customer has the

option of paying any amount of premium, any number of times (within
a policy year) irrespective of the mode. Traditional products available
in the market do not offer such a facility.

4. BUILT-IN GUARD AGAINST UNITENDED LAPSATION: These products

provide continuity of risk coverage for a long time even if the
premiums remain unpaid. The continuity of risk is ensured with the
help of monthly recovery of cost of insurance and automatic premium
advance facility. A policy can lapse if and only if the policy fund
pertaining to the individual policy becomes negative.

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5. RISK COVER DOES NOT DECRESE DURING THE TERM OF THE POLICY:
Unlike traditional life insurance policies, where the sum at risk (Sum
assured –paid up value) actually goes on decreasing, in our flexi
policies, death benefit is sacrosanct and and remains uniform
throughout the tenure of the policy. In case of death, the face amount as
well as the policy fund representing the saving portion in the premium
is payable.

6. ACCELERATED PAYMENT OF PREMIUM POSSIBLE: Depending on

one’s financial situation a shorter premium-paying period can be
selected, with the advantage of greater accumulation resulting into
higher death/surrender/withdrawals/ maturity benefits.

7. LIQUIDITY ON TAP: Traditionally, insurance products have been know

to be illiquid. Policy loans are at a cost and surrenders defeat the very
purpose of insurance. In such an environment, the facility of
withdrawals without affecting the risk cover is one of our unique
features.

8. NO PENALTY FOR SURRENDER: Unlike in traditional type of life

insurance policies where the policy holders have to suffer a financial
loss on surrender of their policies, our products do not provide any
surrender charge after the first four years.

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 9. CUSTOMERS CAN SEE THEIR MONEY PERFORM: Our policyholders
are provided with an access code to know the policy values online.
Besides, the investment performance of the various options is published
every quarter and the policyholders receive a yearly statement
reflecting the status of the policy fund.

10. OTHER BENEFITS:

a. Lower premium for female customers
b. ‘Age last birthday’ gives the customers advantage of lower age
c. A policy can be customized to the policyholder’s requirements.
For instance our ‘Flexi life line’ with the facility of limited
premium payments and withdrawals thereafter, becomes a
veritable pension plan with attendant tax benefits.
d. Detailed illustration at the point of sale

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21
1.3 ORGANISATION STRUCTURE: two guides Biral sun life
insurance business operations if its core values, namely integrity and
transparency. BSLI complies with a all regulations governing the life
insurance business. A high degree of transparency is followed in al the
business practiced and procedures and all employees are governed by an
internal code of conduct.

BSLI abides by the corporate governance framework in accordance with

the Kumar Managalam Birla committee as applicable to the life insurance
business, as well as the provisions of the insurance act, 1938, the
companies act, 1956 and the IRDA regulations.

The various committees overseeing the business are:

BOARD OF DIRECTORS
• Mr. Donald Stewart- chairman
• Mr. Kumar Mangalam Birla
• Mr. Gary M. Come ford
• Mr. Douglas C. Hence
• Mr. S.K. Mitra
• Mr. B.N.Purankmalka
• Hish Highless Maharaja G.Singh
• Mr. S.N. Talwar
• Mr. G.P. Gupta

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AUDIT COMMITEE

• Mr. B.N. Puranmalka

• Mr. S.K. Mitra
• Mr. D.C. Henck
• Mr. G.M. Cmerford

INVESTMENT COMMITEE

• Mr. S.k. mitra

• Mr. B.N. Puranmalka
• Mr. P.J. Akers
• Mrs.K.Gupta
• Mr. A. Fenn
• Mr. N.B. Javeri
• Mr. S.Shah

EXECUTIVE COMMITTEE

• Mr. G.M. Comeford

• Mr. D.C. Heck
• Mr. S.K.Mitra
• Mr. B.N. Puranmalka

23
Apart from the above committees overseeing the business operation, the
CEO and CGO certify the audited accounts of the company and company
secretary submits a compliance certificate.

24
 THE BSLI MANAGEMENT TEAM

Mr. Nani Javeri

(CEO)

Mr. Peter Akers

(CFO and appointed actuary)

Mr. E.N.Goveia Mr.

P.Nandagopal
(Senior vice president –direct sales force) (Senior vice president-alternative
Channel and group life)

Anjana Grewal Jaskirat Kaur Snehal

Shah K.S.Gopalkirshnan
(marketing &comm.) (group life &personal) (control & admin.) (actuary)

Mr. K.H. Venkatachalam (chief manager-human

resource)

25
 Mr. Mayank Braganaza (chief manager- finance and

planning) Mr. Sanjay Parikh (chief manager- product

development)

1.4 BRIEF PROFILE OF SEVICES OF ORGANISATION:

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 Pioneered by Birla sun life insurance, Unit- linked solutions bring
together the best of life insurance and investment, together. A unique
combination of security from life insurance and returns from
investment. Introduced in line with the latest global trends, the unit-
linked plans put you in total control of your money. They are simple
transparent and flexible. What’s more, they offer 3% minimum
guaranteed overall returns on the premium.

Birla sun life insurance provides individual as well as group life

insurance solutions aimed at the corporate sector.

1.4.1 INDIVIDUAL LIFE PLANS: Birla sun life insurance offers number
of individual life plans, which can be given below-

1.4.1. FLEXI SECURELIFE RETIREMENT PLAN: This is a unit-linked

retirement plan to give you efficient returns in the long term so as to
build a sufficiently large corpus of savings on retirement. The planes
built in tow phases: the accumulation phases and annuity phase. During
the accumulation phase the plan gives you a choice of three investment
options to invest your money with an option to switch between these
funds to match your risk appetite. What’s more it offers a guaranteed
minimum return of 3% on your premium (deposit) amount net of all
charges and deductions in this phase. In the annuity phase the plan
gives 2 options to choose from.

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1.4.1.FLEXI LIFE LINE PLAN: This plan offers a life insurance cover till
the age of 100 years thus providing you with a lifetime of security. It is
an investment for your future in which you accumulate large savings
through the benefits of compounding. The plan gives you the flexibility
of making tax-free withdrawals and can be customized as tax efficient
pension during your working years while the plan continues for a
lifetime.

1.4.1 FLEXI SAVE PLUS ENDOWMENT P LAN: It is a flexible life

insurance plan, which offers the dual benefit of a life insurance cover as
well as large tax-free savings in the long term. The plan is taken for a
specified period and the benefits are payable in the events of death
during the tenure of the plan or at maturity. The unit-linked nature of
the plan coupled with the benefits of compounding can lead to very
efficient returns in the long term.

1.4.1 FLEXI CAH FLOW MONEY BACK PLAN: It is a flexible life

insurance plan, which offers a life insurance cover and gives lump sum
payment at periodic intervals. These periodic payments intervals. These
periodic payments help you meet your various financial obligations at
crucial junctures such as education or marriage of your child. The unit-
linked plan also offers you the option of not withdrawing the lump sum

28
 amounts and continuing it in the plan to take advantage of the benefits
of compounding.

1.4.1 BIRLA SUN LIFE TERM PLAN: The plan offers large life insurance
cover for very low costs for a specified term. It is a low premium, pure
risk coverage plan, which takes care of one’s financial commitments
toward his/her depending should anything unfortunate happen to line
policyholder.

1.4.1 BIRLA SUN LIFE PREMIUM BACK TERM PLAN: The plan
offers you a life insurance cover for a specified term. Unlike other term
plans this plan refunds the entire amount of premium that you pay over
a period of time. There are two options of maturity benefits to choose
from and what is m ore it is a low cost life insurance plan.

1.4.2 GROUP PLANS: Birla sun life insurance Company offers number of
group plans, which can be, described below-

1.4.2 GROUP GRATUITY SOLUTIONS: It works for your future group

gratuity addresses the need of prudent financial management for a
progressive corporate house. The unique benefit being it provides
market-linked returns that present an opportunity for capital
appreciation in the long term. Besides when the fund yields better
returns, it decreases the contribution to the fund in the years.

29
1.4.3 GROUP SUPERANNUATION PLAN: Retire in comfort- Birla sun
life insurance offers group superannuating plan as a retirement solution
for employees. The plan has benefits that empower both the employer
and employee. The contribution is invested in unit-linked funds
yielding market-linked returns to meet your future needs efficiently.
Additionally original / principal contribution is guaranteed against
market fluctuation.

1.4.4 GROUP PROTECTION PLAN: Birla sun life insurance provides

group protection plan for a homogenous group. Under this plan, life
insurance cover is provided at an affordable cost. Renewed every year,
it helps fulfill the insurance needs of employees as well as provide
financial security to their families. In the event of death of the member,
the beneficiary (family) of the member gets the benefit. The plan has 6
additional riders and two options.

30
 PLANS AT A GLANCE

FLEXI SAVE PLUS FLEXI CASH FLOW FLEXI LIFE LINE

ENDOWMENT PLAN MONEY BACK PLAN PLAN
ELIGIBILITY 30days –65 years 30days –65 years 30days –65 years

MINIUM FACE AMOUNT Rs.50, 000 for minors Rs.50, 000 for minors and Rs.50, 000 for
and Rs75, 000 for adults Rs75, 000 for adults minors and Rs75,
000 for adults
DURATION OF THE As per policy term-5, As per policy term-5, As per policy term-
PLAN 10,15,20,25,or 30 years 10,15,20,25,or 30 years or 5, 10,15,20,25,or
or as per maturity age-15, as per maturity age-15, 30 years or as per
20,25,30,35 years for 20,25,30,35 years for maturity age-15,
minors and 60,65,70,80 minors and 60,65,70,80 20,25,30,35 years
years for adults years for adults for minors and
60,65,70,80 years
for adults
PREMIUM PAYING Single pay 5,10,15,20 Single pay 5,10,15,20 Single pay
PERIOD years or over the duration years or over the duration 5,10,15,20 years or
of the plan of the plan over the duration of
the plan
MATURITY BENEFITS Policy fund Policy fund Policy fund
AMOUNT DUE TO Face amount+policy fund Face amount+policy fund Face
NOMINEE IN EVENT OF amount+policy
DEATH OF THE LIFE fund
INSURED
FREELOOK PERIOD 15 days from the date on 15 days from the date on 15 days from the
which you receive the which you receive the date on which you
policy document policy document receive the policy
document
TAX BENEFITS** Under sec 88 and sec Under sec 88 and sec Under sec 88 and
10(10D) of the income 10(10D) of the income tax sec 10(10D) of the
tax act 1961 act 1961 income tax act
1961
RIDERS • Accidental death and • Accidental death and • Accidental death
dismemberment dismemberment benefit and
benefit rider Rider dismemberment

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 • Term rider • Term rider benefit rider
• Critical illness rider • Critical illness rider • Term rider
• Critical illness plus • Critical illness plus • Critical illness
rider Rider rider
• Waiver of premium • Waiver of premium • Critical illness
rider rider plus
Rider
• Waiver of
premium
Rider

UNIQUE FEATURES • Minimum guaranteed returns of 3% p.a. on your premium net of all
policy fees of all policy fees and charges. The entire upside in the
performance of the fund is passed on to you.
• Three investment fund options: protector, builder and enhancer with
option to switch between funds any time after the first policy year.
• Options to make tax-free withdrawals you have additional savings.
• Vary the face amount of policy depending on your changing needs for
life insurance during your lifetime.
• Surrender your policy without penalty anytime after 4 policy years.

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1.5 AREAS OF EXCELLENCE: Drawing from the strength of the joint
venture partners. The aditya Birla group and sun life financial inc. the
team of Birla sun life insurance has crossed several milestones of
excellence.
 Leadership in unit-linked plans- 95% of sales come through unit-
linked plans. The company is one of the largest sellers of unit-linked
plans in one of the fastest growing life insurance markets in the
world.
 The company is a p pioneer in introducing unique product features
like a ‘free look period’ and best sales practices such as the use of
“sales illustrations”. The regulator has now introduced the ‘free look
period’ as an industry norm. The mandatory use of a sales
illustration within BSLI set up a standard of transparency in the
industry.
 A high persistency ratio of 95.46% by premium.
 BSLI has consistently recorded the highest average sum assured of
Rs.3, 26,000 and average premium of Rs.19,500 per policy in the
industry with a unit-linked product range.
 A very efficient utilization of capital.
 Low claims ratio of 0.06% of total policies.
 The first advisor to qualify to the “top of the table” (TOT) amongst
all private life insurance companies.

33
1.6 GROWTH OF BIRALA SUN LIFE IN UNIT-LINKED LIFE
INSURANCE: Another successful financial year came to an end. The
company reported an annualized new business income of Rs.478 crore
during the year 2003-04 an increase of 222% over the premium income
lat year. The company of the year-end had an agency force of around
10,250 agents, and 89 ban assurance & corporate partners. All three sales
channels came out with flying colors. During the year 2003-04 the
company has launched two new groups and one individual fund.

During the year 2003-04, the BSE sensex has gone up by 81% but the
first quarter of year 2004 was not very exciting for the market except for
a huge supply of PSU IPOs. In March 2004, the markets have been
choppy and combined with the upcoming elections. This has caused
some amount of investor uncertainty. After a continuous rise between
may 2003 and January 2004, the quarter saw a correction in the market.
The BSE sensex went up to an all time high in January 2004 and the
quarter closed at 5590.60 down almost 4% from December 2003 level.
There was a large supply of IPOs by PSUs, which met with a good
response. The fundamentals remained good and foreign institutional
investors (FIIS) continued buying even though the markets declined. The
GDP growth numbers has also been encouraging at 10.4% in October –
December 2003 quarter.

34
 The interest rates remained range bound in the quarter with some amount
of volatility. The 10- year benchmark G-sec closed at 5.15% at the end of
the quarter.

The rupee strengthened further to close the quarter at 43.60/ US $ against

Rs.45.61 at the end of December quarter and Rs.47.50 a year ago. Forex
reserves have crossed $ 110 bn in March 2004 on the back of strong
growth in FDI and FII inflows.

We will continue to invest in diversified and quality portfolio with a

long-term view.

Returns on unit-linked individual life funds.

(Based on unit price growth, net of charges) as on 31st march 2004

PARTICULARS RETURN ON ANNUALISED LAST I YEAR

INVESTMENT RETURN (%)
(SINCE INCEPTION) % (SINCE INCEPTION)%
PROCTER 39.20 12.95 20.62
BUILDER 51.11 16.88 28.33
ENHANCER 70.98 23.45 38.56

35
 Returns on unit –linked pension funds:

PARTICULARS RETURN ON INVESTMENT ANNUALISED RETURN LAST I YEAR

(SINCE INCEPTION)% (SINCE INCEPTION)% (%)
NOURISH 13.94 13.21 13.30
GROWTH 15.54 14.97 14.90
ENCRICH 18.78 17.80 18.10

36
37
1.7 PROBLEMS IN ORGANISATION:
Problems in the organization, which are assigned by officer, are not so
big problem. It is clear that BIRLA SUN LIFE INSURANCE
COMPANY is a unit- linked insurance, which are basically involved in
the life insurance solutions. There are number of problem which are as
follows-
1) The main problem of the organization is that the it is not
government organization like a life insurance solutions.
2) The second main problem is that lack of believes on the
organization by the people.
3) The third problem assigned by the organization that there are the
few branches of the BRILA SUN LIFE INSURANCE
SOLUTION.
4) Another problem is that the lack of good quality, good skill
insurance advisors.

38
39
2.0 DISTRIBUTION NETWORK

BIRLA SUN LIFE INSURANCE COMPANY LTD, distribution

strategy is aimed at creating a national presence through a scaleable
model, which would achieve convenience, accessibility and quality
service for the customers.

2.1 DIRECT SALES FORCE: Through this channel, the company sets up
brick and mortar branches on a standardizes template, across the country
selling life insurance though trained career agents called ‘insurance
advisor’. The team of agency managers and advisors are geared for
productivity enhancement national presence in 44branches and
9development centers.

2.2 LTERNATE CHANNELS: The experience in various countries for

selling life insurance through banks, corporate agents, brokers, call
center, Internet and these distribution alternatives will be pursed by the
organization from the inception stage. While in India there was no
precedent for selling life insurance though these alternate modes, a
philosophy of piloting and stabilizing the model was adopted.

The successful business models for banassurance, corporate agency,

brokerage, affinity group and direct marketing are being consolidated.

40
 use of the call center and the internet will continue to be part of the
direct marketing initiatives .with a winning multi-channel distribution
system in place ,BSLI alternate channels are frontrunners in
bancassurance business, in partnership with Citibank ,Deutsche
bank,Bankof Rajasthan,BankMuscat,Catholic Syrian Bank, Development
credit bank and IDBI Bank.

2.3 OUP INSURANCE: The selling of insurance to corporate and affinity

groups is developed though dedicated relationship managers. The
business focus is on the Aditya birla group companies and the top
corporate in India.

Through this channel, the company has established relationships with

more than 100 blue chips corporate across the country by providing
group protection and group retirement solution. The company has
achieved leadership position in-group business in private life insurance
position in providing fund management services for the group retirement
plans.

2.4 DISTRIBUTION IN TUNE WITH TECHNOLOGY: Technology

plays the crucial role, when distribution spans across more than 50
locations .the IT strategy revolves around selecting and implementing
critical business applications to support contemporary products like
universal life and aligning process to provide world-class customer

41
 services. The systems are web enabled and equipped to provide
consistent information across all touch points (branches, callcenters
website etc.). A high quality wide area network (WAN) was set up to
interconnect all branches and the headquarters at mumbai.

2.5 TRANNING TO SUPPORT DISTRIBUTION: In keeping with

support throughout the country. Birla sun life insurance’s mission of
providing life insurance solutions though “well trained” professionals,
our tanning team has geared up to meet the challenge. We have a team of
qualified professionals to provide the crucial support throughout the
country.

42
43
6.0 PRICING POLICY OF THE COMPANY:

6.1 KEEP TRACK OF YOUR POLICY FUND: Birla sun life insurance
sends you an annual policy statement on every policy anniversary to
keep you completely informed on the performance of our various funds
based on the unit price will be available on our website.

6.2 ELECTRONIC CLEARING SERVICE (ECS): The ECS is a convenient and

hassle- free method of paying premiums through an electronic debit to

your bank account.

INVESTMENT FUND PORTFOLIO:

UPPER LIMIT OF %ASSETS PROTECTOR BUILDER ENHANCER

IN:

Government and 85% 70% 55%

government approved
securities
Rated corporate bonds (AA 30% 30% 30%
and above)
Money market and other 20% 20% 20%
liquid assets

Infrastructure sectors as 25% 25% 25%

defined by the IRDA

Listed equities 10% 44 20% 35%

6.3 FEES AND CHARGES: The policy loading fee* is an up-front charge

and varies as per the premium payment mode and the policy year as
given under:

PAY PERIOD
POLICY YEAR SINGLE 5-PAY 10-PAY 15-PAY OR GREATER
1 3% 29.9% 54.6% 65%
2 N/A 5.0% 7.5% 7.5%
3 N/A 5.0% 7.5% 7.5%
4+ N/A 5.0% 5.0% 5.0%

As a percentage of premium. The policy-loading fee for top up wills 2.0 percent.

6.5 CHARGES:

6.5.1. Charges towards the cost of insurance will be

deducted by cancellation of units at the prevailing unit price on a
monthly basis. The annual insurance charges per thousand-face amount
for sample ages for healthy lives are as follows:

Sex/age (yrs) 20 30 40 50 60

Female 0.90 1.16 1.66 4.03 10.66

Male 1.02 1.17 2.15 5.53 13.73

45
 6.5.2. An investment management free not exceeding
1.5% p.a. of the fund will be charged by adjustment of daily unit prices.
Currently this fee is 1% p.a.

6.5.3 The following administration fees will be deducted by canceling units

on a monthly basis.
(a) Rs. 22 per month
(b) An annual charge of Rs. 2.88 per thousand face amount will be
deducted in the first 10 years of the policy expect in the second year
where it will be Rs. 15.24 per thousand face amount. From the 11th
year onwards this annual charge will increase subject to a maximum
of 3.75%per year.

6.5.4 A monthly rider deduction will apply by cancellation of units on a

monthly basis based on the equivalent monthly rider premium payable
over the entire coverage benefit period. If rider deductions are not
guaranteed, then the minimum policy values of your policy might be
affected due to any change in the rates of the rider coverage.

6.6 FUND SWITICHING CHARGES:

6.6.1 In a year, one switch between investment fund
options is free.
6.6.2 For every additional switch, a charge of Rs.100 will
be levied.

46
6.7 SURRENDER CHARGES: The surrender charges is levied in the
first four years and varies based on the year in which the policy is
surrender. During the first 24 months of the policy, the charge will be
an amount equal to the annulled premium payable for this policy .for
the purpose of surrender charge only, annualilsed premium is defined
as the amount that is payable if the coverage paying period is equal to
the coverage benefit period. In the 25th month, the surrender charge is
24 percent of the annualized premium. The surrender charge percent
reduces by one for e very month thereafter. If the policy is
surrendered at any time after the 49th month, the surrender charge is
zero.

6.8 WITHDRAWAL CHARGES:

• In a year tow withdrawals are free of charge
• For every additional withdrawal, a charge of Rs.100 will be levied.

47
AN ILLUSTRATION, WHICH IS SHOWING THE PRICING POLICY OF
THE COMPANY:

THIS PRESENTATION IS PREPARED FOR: Mrs.Nisha Singh

Name of life insured: Mrs.Nisha Singh

Date of birth 01/07/1964/ female

Coverage type Face amount coverage annual

(Rs.) benefit
coverage
period premium
(years) (Rs.)
Flexi save plus (age) 90,000 30 4,563.60
Accidental Death &
Dismemberment rider 90,000 25 151.20

Policy premium 4,714.80

Due and payable Quarterly

The premium and associated benefits are described in the product

brochures and the following illustration. The details provided in the
following illustration would enable you to see how your p premium
is being used. If you need help to interpret please contact your

48
insurance advisor or call Birla sun life insurance Company’s toll
free number, which is 1600227000.

Some benefits are guaranteed and some benefits are variable with
returns based on the future performance of your insure carrying on
life insurance business. If your policy offers variable returns then
the policy fund values table will show two different rates of assumed
future investment returns. These rates return are not guaranteed
and they are not upper or lower limits of what you might get back,
as the value of your policy is dependent on a number of factors
including future investment performance. The guaranteed amounts
are the minimum amount that you can expect if all the conditions
mentioned later are fulfilled.

This illustration ignores the impact of the provisions of the income

tax act, 1961. The provisions of section 88 of the income tax act,
1961 govern a tax rebate for premiums paid towards an insurance
policy. The tax exemption for the benefits paid under a life
insurance policy is governed be section 10(10D) of the I income tax
act, 1961. Both these sections may be applicable to this policy .you
may consult a qualified tax advisor for specific tax advice related to
you. If required by the act, we will withhold taxes from the benefits
payable under this policy. We also reserve to you. If required by the
act, we will withhold taxes from the benefits payable under this

49
policy. We also reserve the right to recover from you levies such as
service tax levied by the authorities on insurance transactions.

Please note that in the following pages that illustrate the policy fund
values:

The premium and all values shown are for the life insurance
coverage and do not include riders. The rider benefit amount will be
payable, wherever applicable in case of happening of the events as
mentioned in the rider brochure in consideration of the payment of
additional premium/charges.

Policy fund values shown as at the end of the year and assume:
(1) Premiums are paid in full when due,
(2) No withdrawals are made,
(3) No outstanding policy loans exit,
(4) The investment fund options is not changed throughout the
lifetime of the policy,
(5) Increase in premiums or charges for riders having non-
guaranteed premiums or charges are not recovered from the
policy fund,
(6) No change is made in the face amount of the life insurance
coverage and

50
(7) Policy fees and charges are at current levels as explained in
the section “policy fees and charges”. The premium
mentioned in this illustration does not include top-up
premium or any underwriting extras.

Upon surrender or maturity of the policy, the amount payable to the

policy owner is the sum of:
(1) Guaranteed policy fund surrender /maturity value, and
(2) Non-guaranteed policy fund
Less any amounts owed to the company.
The sum of 1 and 2 above constitutes the policy fund.

With drawls can be made from the holding account, which

comprised the non-guaranteed policy fund.

Upon the death of the life insured, the death benefit is sum of
(1) Life insurance coverage face amount, and
(2) Policy fund
Less any amounts owed to the company
Provided that where the death of the life insured takes place before
the commencement of the policy anniversary, on or immediately
following the age when the life insured reaches one year, only the
policy fund shall be payable.

51
 The non-guaranteed policy fund may or may not arise depending on
the performance of the investment fund supporting the policy .an
investment by you in any of the investment funds I s subject to
market and other risks, the value of the investment fund can go up
or down depending on the factors and forces affecting financial
markets. Other than explicit guarantees provided by the company,
there can be no assurance that the objectives of any investment fund
will be achieved.

FEES AND CHARGES: The policy loading fee* is an up-front

charge and varies as per the premium payment mode and the policy
year as given under:

PAY PERIOD
POLICY SINGLE 5-PAY 10- 15-PAY OR
YEAR PAY GREATER
1 3% 29.9 54.6 65%
% %
2 N/A 5.0% 7.5% 7.5%
3 N/A 5.0% 7.5% 7.5%
4+ N/A 5.0% 5.0% 5.0%

In addition to the above policy-loading fee, the following policy fees

and charges will be recovered from the policy fund.

1) The cost of insurance of the life insurance coverage will be deducted

by cancellation of units at the prevailing unit price on a monthly

52
 basis. The annual insurance charges per thousand of the life
insurance coverage face amount for sample ages for healthy lives
are as follows:

Sex/age 20 30 40 50 60
(yrs)
Female 0.9 1.1 1.6 4.0 10.66
0 6 6 3
Male 1.0 1.1 2.1 5.5 13.73
2 7 5 3

2) An investment management fee not exceeding 1.5 percent per

annum of the investment fund will be charged by adjustment of the
daily unit prices. Currently this fee is 1 percent per annum.

3) Policy administration fees for the life insurance coverage will be

reeducated by canceling units on a monthly basis, as follows:

a) Rs. 22 per month; and

b) Annual charge of Rs. 2.88 per thousand of the life insurance
coverage face amount will be deducted in the first 10 years of the
policy expect in the second policy year when it will be Rs. 15.24 per
thousand of the life insurance coverage face amount. From the 11th
year onwards this annual charge (Rs. 2.88 per thousand of the life
insurance coverage face amount) increases at an annualized rate of
a maximum of 3.75%, every year.

53
4) The surrender charges to be levied vary based on the duration of the
policy. During the first 24 months of the policy, the charges will be
an amount equal to the annaslised premium payable for this p
policy. For the purpose of surrender charges only, annualized
premium is defined, as the amount that is payable if the coverage
playing period is equal to the coverage benefit period. In the 25th
month, the surrender charge is 24 percent of the annuallised
premium. The surrender charge percent reduces by one for every
month thereafter. If the policy is surrendered at any time after the
49th, the surrender charge is zero
.
The premium net of all charges and fees will earn a minimum life
insurance net return of 3 percent per annum, which constitutes the
guaranteed fund. Any returns earned by the policy fund in excess of
the guarantied fund constitute non-guaranteed fund.
For a detailed description of the features of the product, please refer
to the product broacher.
Acronyms used:
TPD- Total And Permanent Disability,
TPD/CI- Total And permanent Disability or Critical illness,
Death/TPD –Death or And Permanent Disability,
Death/TPD/CI- Death or Total Permanent Disability or Critical
illness.

54
 5.

5.0 OBJECTIVE OF THE STUDY:

The main objective of this study is found out the view of different
people about the unit-linked life insurance. And find out what they
take insurance advisors advise for their investment or not. If not
indicate the people for their life insurance and tells them why life

55
 insurance is necessary for every persons. There are some reason
which indicates why life insurance is necessary for every person given
below-

5.1 MARKETING OBJECTIVE:

The main marketing objective of this project report for the company
is find out marketing position of the life insurance and makes the
present and future market strategy of the company.

5.2 RESEARCH OBJECTIVE:

1. Identifying the sources of money or funds a p person has and what

happens to that money (where is goes) than
2. Determining the person short and long term priorities
3. Analyzing this information or ones can advice changes to the
person financial habits or enable him to achieve his goals.

56
57
 6. RESEARCH METHODOLOGY: For defining research
methodology there are three basic types of methods for marketing
research. They are as follows:

a) The observation method.

b) The experimental method.
c) The survey method inclusive of panel method.

In observation method data are collected on the direct observation. No

talks place by observing the person the analysis makes the inventory as
to product used by him at his hoe or kept as retailers stocks.

In experimental method it is based on the concept that small-scale

experiment is useful to indicate the expectation of large-scale
experiment.

The survey method information is gathered directly from individuals in

three ways;
1) Telephone
2) Mail
3) Personal interview
This survey method is also suffered to as the questionnaire technique.
There is also organized by-
1) In factual survey

58
2) Interpretative survey
3) Opinion survey

In my project point of view I have taken mainly the method of personal

interview by questionnaire technique in the personal interview by
questionnaire.

Technique I usually gathered information by face to face interviewing.

In this survey method I saw that the respondent was shown the exhibit
and advertisement to give his personal opinion and attitude.

In this method the direct interaction on occurred with the retailers and I
could collect the reliable information from them.

59
 RESEARCH PROCESS

DEFINING RESEARCH
PROBLEM

INTENSIVE LITREATURE
SURVEY FEED BACK

RESEARCH DESIGN

COLLECTION OF DATA

ANALYSIS OF DATA

RECOMMENDATION AND
REPORT WRITING

60
6.1 SAMPLING PLAN: Sampling plan of this project report
basically related to the number of points which are given below-
The universe studied prospectors in the areas of N.C.R. mainly
Delhi, Ghaziabad, Noida & Gurgoan.
The sampling unit is a single prospector outlet, which may be any
types.
Elements: potential prospector.
The geographical limit is the area of N.C.R.
Keeply the number of prospector in mind the sample size arrived
at was 200.
The sampling method followed was judgmental sampling.

61
6.2 TIME SCHEDULE:

TOTAL DURATION 17 JULY TO 20 AUGUST

PREPATION FOR DATA COLLECTION 17 JULY TO 12 AUGUST
DATA COLLECTION 21 JULY TO 15 AUGUST
DATA CALIFFICATION AND PREPARATION 16 JULY TO 21 AUGUST
OF REPORT

62
7.0 DATA COLLECTION METHOD:
In my project report, which has entitled “a research repot on market
potential in life insurance solution in NCR region”, has been collected
data from the two method-
(A) PRIMARY SOURCE
(B) SECONDARY SOURCE

63
Under the primary source data collected by me through the observation,
survey and personal interview.

QUESTIONNAIRE METHOD: Through the questionnaire method

number of question asked by the different people from the different
region mainly DELHI, GHAZIABAD, NOIDA, GURGON by me. My
questionnaire method is a open ended method in which questions asked
by me has a limited number. The main purpose of this questionnaire is
find out the view of the people that they take insurance advisor’s advice
or not. In which they like to investment their savings. The format of
questionnaire of this company is given next page-

64
Survey method: This project report is also suffered by the survey
method for collecting the relevant information, so that marketing
executive will be success for making marketing strategy according to
that survey.
The main purpose of this survey which help the insurance advisors to
identify the type of market in which insurance advisors may be
prospecting and selling should he enter the life insurance business.
It will also aid management in estimating their sales potential and in
determining the type of training that would be most beneficial to him.
The names you enter represent people you know today. Should you
enter the business of selling life insurance, you will learn proven ways
to meet new people and expand these markets.
While many of those you list are presently prospect for life insurance
and others are not, do not make the need for life insurance a
requirement for adding their names. Do not list names by any
predetermined selection rating. Simply list the first 100 names of those
who come to your mind most readily.

65
 (Sampling page)
Sources Of Names Source Letter
A. School / college friends
Persistency source
B. Family friends
C. Neighbours

NAMES SUBMITTED
D. Through Spouse
E. Through children
F. Through Hobbies / Spot
G. Previous employment
> 1 Lakh
> 1 Lakh but < 2.5 Lakhs
YEARLY INCOME > 2.5 Lakhs but < 5 Lakhs
> 5 Lakhs
(In Rupees)
18 – 25 YEARS
26 – 35 YEARS
AGE 35 – 44 YEARS
OVER 45 YEARS
OCCUPATION Professional / proprietor
Manager / Executive
MARITAL STATUS Single
Married
ABILLITY TO Good
PROVIDE REFERALS Fair
INTERVIEW: This project report is also affected by the interview
method. The data is also collected through the interview. Under this method
we go through the –

66
 Telephone interview
 Mail interview
 Personal interview

Under the telephone interview is used when the information to be collected

limited. This method is suitable for inquiry about information just released or
telecast by radio or television.

Under the mail interview data is collected when the data is more important.
Because there is no interviewer in mail surveys to ask questions and record
answers. It cannot be used to conduct an unstructured study.

Under the personal interview data is collected through the door to door. This
method is very relevant and it is also very difficult task to collect the
information. And takes much time.

OBSERVATION METHOD: This project report is also suffered by the

observation method. Because some time it is also happened when the number
of people was not ready to give the relevant information used this techniques
to collect the information.
This observation is used when the research problem has been
formulated precisely and the researcher is told to observe the area of
sturdy. The researchers are asked to record their observations.

67
(B) SECONDARY DATA: under this project report data is also collected
through the secondary data. Under this source data is collected through
the magazine, through the web site, through the newspaper, through the
other insurance organization.

68
69
8.0 TABULATION & ANALYSIS:
From the above questionnaire, we found number of findings and
according to them we can do analysis that which type of strategy should
be adopted for improving the earnings of the company given below-

QUESTION NO 1- How many people plan for their savings and

investment?

YES NO
PEOPLE (IN %) 64% 36%

70
70%
60%
50% PEOPLE (IN % )

40%
30%
20%
10%
0%
YES NO

71
QUESTION NO.2- How many people take help of professional advisor for

their investment?

YES NO
PEOPLE (IN %) 35% 65%

70%
60%
50%
40% YES
30% NO

20%
10%
0%
YES NO

72
QUESTION NO. 3- Number of people save regularly for-

SAVING ALTERNATIVS PEOPLE IN %

RETIREMENT 15%
CHILDREN’S EDUCATION 25%
CHILDREN’S MARRIGE 40%
TAXATION 15%
OTHERS 5%

40%
35% RETIREMENT
30%
CHILDREN’S
25%
EDUCATION
20% CHILDREN’S
MARRIGE
15%
TAXATION
10%
5% OTHERS

0%
PEOPLE IN %

73
QUESTION NO. 4 – How many people save through insurance?

YES NO
PEOPLE (IN %) 35% 65%

74
100%

80%

60%
PEOPLE (IN %)
40%

20%

0%
YES NO

75
76
7.0 SWOT ANALYSIS:
SWOT analysis of this company is given below-

7.1 STRENGTHS: Strength of this company is given below-

7.1.1 There is transparency in the scheme. The performance of the fund can
be monitored on daily or bi-weekly basis through the daily- declared
NAV/ Unit prices and also through the website of the company. At
any given time you will k now the accumulations under your policy
due to the investment accruals.
7.1.2 Normally any time after one to three years time depending upon the
scheme, you can chose to withdraw your money by partial or
complete surrender of units. The death benefit will be proportionately
reduced.
7.1.3 You can surrender the policy and get a guaranteed surrender value.
7.1.4 You can also take a loan on a policy after three years duration.
7.1.5 You can switch from one stream of investment to the other every year
by paying a small fee according to your changing needs.
7.1.6 You can top up your premium anytime during the term to increase your
benefits.
7.1.7 The plans are available as endowment whole life money back or as
pension plans.
7.1.8 In fact some companies allow you to have the contract as long as you
want without a fixed term, even up to death.

77
7.1.9 The option of with or without profits is also available in some plans.
Actually some companies give a guaranteed bonus as a percentage of
the sum assured as bonus
7.1.10The normal riders such as accident benefit, disability benefit critical
illness or major surgical assistance covers are also available.
7.1.11The policies are issued with the usual “free-look” provision.
7.1.12One company has floated a unit-linked policy for women with a critical
rider benefit specifically covering some gynecological illnesses.
7.1.13You can buy the policy with a single premium like a bond or pay
premium by the usual yearly, half-yearly or quarterly mode.
7.1.14Some companies offer even “premium holiday option”. If after paying
premiums for three years you are not able to pay the premium, the
policy will be continued adjusting the overdue premiums from your
unit fund.

7.2WEAKNESS: Weakness of this company is given below-

7.2.1 The expenses deducted from the premiums especially in the first two
years considerably shrink the amount that goes towards your
investment corpus.
7.2.2 The heavy frontloading of the effectively acts as a disincentive for early
withdrawals.
7.2.3 The unit-linked plans completely pass on the investment risk to the
policyholder and he has to be ever vigilant.

78
 7.3OPPORTUNITIES: Opportunities of this company is given below-

7.3.1 If unit-linked policies can be given section 88 benefits there is a valid

reason that investment in an ordinary mutual fund should also be
given the same benefit, as they are basically same except for the
addition of insurance element in the unit-linked policy.
7.3.2 The rear end tax-free benefit is a very attractive tax break for the unit-
linked policy as per the current tax laws.
7.3.3 The return by way of capital appreciation in mutual fund as well as
from the sale of stocks are taxed as capital gains with the indexation
benefit, according to the current tax laws. Only the dividends are tax-
free.

7.4THREATS: Threats of this company is given below-

7.4.1 This is company is also suffered by the great market competition. There
are number of competitors of this company.
7.4.2 Another threat of this company is that the changing environment.
Changing environment means change in government, change in
government policy, change is competitor’s policy.

79
80
8.0 CONCLUSION:

Unit – linked policies are a very valuable addition to the existing array
of insurance producers. But, when sold to a wrong prospect or brought
a wrong agent it will become useless. IRDA and the companies should
take care that well- trained and professional agents market these
product.

In view of what was discussed above, the buyer if they need such plans
according to their risk appetite should select a known, well- informed
agent who is reliable. Agents who are already dealing with investment
or saving instrument or mutual funds, if they sell life insurance also
would be a good choice. In case they hence doubts about the
availability of such agents, it would be more advisable to go to
corporate agent with a background in financial instruments or still
better, to a good broker who are likely to be better equipped than an
ordinary agent. Continued advice and guidance will be available with
the corporate agent and the broker as they are corporate entities.

81
82
9.0 SUGGESTION:
By this project report there are the number of suggestion which can be
given to the company are given below-
9.1Company should recruit well-informed, well-qualified, well-financial
knowledge. So that he will success to satisfy the potential customer for
their investment or savings.
9.2In fact, the contract to buy the product in my opinion is not the usual
insurance contract governed by the principle of unerimma fides but one
of caveat emptor. Under the principle of utmost good faith, the
company expects the proposes to give all the material facts so that it can
charge the “correct premium” based on the factors of risk presented.
9.3How to deal with the situation? The companies or IDRA cannot educate
the policyholder. They should educate the agent.
9.4Prospective unit-linked policy buyers should understand the structure of
the plans , the factors that determine how good their returns will be and
the risks involved and then figure out if they have the risk appetite,
whether they can get better returns on their investment elsewhere and
whether their investment horizon matches the long lock-ins over which
these plans offer the best rewards.
9.5Insurance companies will generally give you a picture on the basis of the
past performance of the fund but the past performance of the fund is
never an indicator of how the fund might perform in the future.

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9.6Insurance companies allow you to shift from one fund to the other at any
point of time. This can be useful if you want to plan your investment
based on your life needs.

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ANNEXURE:

Under the annexure we include-

Questionnaire

Survey form

An illustration of the company policy ( All the documents which are received by
the client at the time of policy)

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 QUESTIONNAIRE:

Birla Sun Life Insurance Co. Ltd.

Life insurance coverage survey

Name: -----------------------------------------------------------------------------------------
Address: ---------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
Occupation: -----------------------------------------------------------------------------------
Tel.: Residence ---------------------------- Office ------------------------------------------
Date of Birth: ------------------------------ Annual Income -------------------------------
Family Particulars:
Name of spouse ------------------------------------------------------- Age ------------------
No. Of Children --------------------------------------------------------------------------------

1. Do you plan your savings and investments?

Yes No
2. Do you take help of professional advisor for your investment?
Yes No
3. Do you save regularly for
Retirement Children’s marriage

Children’s education Taxation Others

4. Do you save through insurance?

Yes No
5. Would you like to get professional advice in insurance solution?
Yes No

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 SURVEY

(Sampling page)
Sources Of Names Source Letter
A. School / college friends
Persistency source
B. Family friends
C. Neighbours

NAMES SUBMITTED
D. Through Spouse
E. Through children
F. Through Hobbies / Spot
G. Previous employment
> 1 Lakh
> 1 Lakh but < 2.5 Lakhs
YEARLY INCOME > 2.5 Lakhs but < 5 Lakhs
> 5 Lakhs
(In Rupees)
18 – 25 YEARS
26 – 35 YEARS
AGE 35 – 44 YEARS
OVER 45 YEARS
OCCUPATION Professional / proprietor
Manager / Executive
MARITAL STATUS Single
Married
ABILLITY TO Good
PROVIDE REFERALS Fair

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 BIBLIOGRAPHY

B00KS- C.R.KOTHARI, PHILIP KOTLER.

MAGAZINE- INSURANCE WATCH, INDIA TODAY, BUSINESS

TODAY, BUSINESS WORLD.

NEWS PAPER- THE TIMES OF NEW INDIA, HINDUSTAN

TIMES, ECONOMICS TIMES, BUSINESS --
STANDARD.

WEB-SITE- www.birlasunlife.com , www.google.com

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