PROJECT REPORT

On
Comparative study of HDFC
Standard Life Insurance Company
product with the market player in
the same domain.

At
HDFC standard life insurance company limited

A REPORT SUBMITTED IN FULFILLMENT OF THE REQUIREMENTS

OF PGDM (MARKETIG) PROGRAM OF I N J BUSINESS
SCHOOL GREATER NOIDA

Submitted to: Submitted by:

ARUN
KUMAR
INJ BUSINESS SCHOOL Roll No.
09BM07
Greater Noida Batch: -
2009-2011

I N J BUSINESS SCHOOL,
Greater Noida
 CERTIFICATE

This is to certify that the project work done on “Comparative study of

HDFC Standard Life Insurance Company product with market player
in the same domain” Submitted to I N J Business school, Greater Noida is
in partial fulfillment of the requirement for the award of Post Graduate
Diploma in Management is a bona fide work carried out by me at HDFC
Insurance Company Limited Greater Noida.

DATE: ARUN KUMAR GUPTA

PLACE: ROLL NO. 09BM07

PGDM 2009-2011

I N J BUSINESS SCHOOL,
Greater Noida
 PREFACE

“The Companies that best satisfy their customer will be the winners. It is the special

responsibility of marketers to understand the need and wants of the market place and to

help their companies not merely looking for sales they are investing in long term,

mutually satisfying customer relationships based on delivery quality, service and value.”

Philip Kotlar

Summer Training is a necessary part for fulfillment of PGDM course. The

Summer Training has given a chance to try and apply the academic
knowledge into the Business Environment and gain insight of Corporate
Culture.

1
INJ BUSINESS SCHOOL
Greater Noida
 ACKNOWLEDGEMENT

I would like to convey my heartiest gratitude to several

people, for their support and guidance which helped me complete my
Summer Internship.
First and foremost I would like to thank HDFC Standard Life Insurance
Co. Ltd., Greater Noida Branch for giving me an opportunity to do my
internship in their esteemed organization.
My special appreciation extends to Mr. Rahul Mishra (Branch Sales
Manager), Mr. Vivek choudhary (Sales Development Manager) and
Mr. Sanjeev Kalra (F.C.Trainer) of HDFC SLIC Greater Noida for their
constant encouragement through out this period.
I would also like to thank our Campus placement coordinator,
Prof .Vaibhav Gupta. And Project guide Prof. Meenu Dutt for their
guidance and unflinching support through out the phases of my internship.
My special thanks to my classmates and dear friends, Mr. Shashi
Mahto, Mr. Rahul singh, Miss.Preeti Kaushik and Mr.Sakur Ansari for
their support through out my internship. With their help I could complete my
work efficiently and effectively. Last but not the least, my endless
appreciation goes to my family who has stood by my side and given me
moral support whenever I was low and boosted my will power.

Thank You.

ARUN KUMAR GUPTA

PGDM
BATCH-2009-2011
GREATER NOIDA

CONTENTS
2
INJ BUSINESS SCHOOL
Greater Noida
Chapter page no.

1. INTRODUCTION 4

2. EXECUTIVE SUMMARY 5

3. OBJECTIVE OF THE STUDY 6

4. INTRODUCTION OF INSURANCE 7-8

5. FUNCTIONS OF INSURANCE 9-11

6. INDUSTRY PROFILE 11

7. COMPANY PROFILE 12-20

8. DEPARTMENT OVERVIEW 21-22

9. SOME TERMS ABOUT ULIP PLANS 23-24

10. PRODUCT PROFILE 24-42

11. TAXATION BENEFIT 43

12. MARKET SHARE 44

13. COMPARATIVE STUDY OF DIFFERENT FIRMS 45-57

14. RESEARCH METHODOLOGY 58

15. CONCLUSION & SUGGESTION 59-60

16. BIBILOGRAPHY 61

INTRODUCTION

3
INJ BUSINESS SCHOOL
Greater Noida
The project started with class room sessions involving lectures and
interactions with the mentors Mr. Parvej Aalam (SDM) and Mr. Rahul
Mishra (B.M.). They explained all the plans available with HDFC SLIC in
detail and plans of other company’s (BIRLA SUN LIFE, BAJAJ ALLIANZ
& LIC).
The classroom also involved role plays and games. The role plays and games
involved students being asked to play the roles of customers or clients and
that of a person trying to persuade the customer to go in for a plan with
HDFCSLIC.
These class room lectures and role-plays helped me to gain a substantial
understanding of the plans. This in turn helped me to effectively explain
these plans to people whom I meet or took appointment to meet. The connect
of life insurance has undergone several changes over the years and what has
myriad array of attractive options apart from the basic of life cover. Life
insurance schemes also offer tax benefits. In today’s scenario life Insurance
solves the three objectives.

1. Security

2. Saving

3. Tax Benefit.

EXECUTIVE SUMMARY

4
INJ BUSINESS SCHOOL
Greater Noida
This project is based upon the fact & figure gathered from the websites about
the plans of the firm. In the first part of the report there are some plans which
are frequently sold by HDFC SLIC in the market, and then comparative
study of pension plan of different firm namely BIRLA SUN LIFE, BAJAJ
ALLIANZ and LIC and Comparison of Children’s plans .
There In the last part of the project I have given some of the findings and
conclusion about the life insurance market and what is the potential of the
market. In the end I have give all the sources from which I have collected all
the information.

5
INJ BUSINESS SCHOOL
Greater Noida
 OBJECTIVE OF STUDY

1. Comparative study of HDFC Standard Life Insurance Company

product with the market player in the same domain.

2. To analyze the insurance plans on the basis of features offered.

3. To observe working of various departments of the organization

4. To know the position of the hdfc slic product in the market.

INTRODUCTION OF INSURANCE

6
INJ BUSINESS SCHOOL
Greater Noida
WHAT IS INSURANCE?
The business of insurance is related to the protection of the economic values
of assets. Every asset has a value. The asset would have been created through
the efforts of the owner. The asset is valuable to the owner, because he
expects to get some benefit may be an income or in some other form. It is a
benefit because it meets some of his needs. The benefit may be an income or
in some other form. In the case of a factory or a cow, the product generated
by it is sold and income is generated. In the case of a motor car, it provides
comfort and convenience in transportation. There is no direct income. Both
are assets and provide benefits. Every asset is expected to last for a certain
period of time during which it will period of time during which it will
provide the benefits. After that, the benefit may not be available. There is a
life-time for a machine in a factory or a cow or a motor car. None of them
will last forever. The owner is aware of this and he can so manage his affairs
that by the end of that period or lifetime, a substitute is made available. Thus,
he makes sure that the benefit is not lost. However, the asset may get lost
earlier. An accident or some other unfortunate event may destroy it or make
it incapable of giving the benefits. We can classify insurance in these terms:-
It is a system by which the losses suffered by a few are spread over many,
exposed to similar risks. Insurance is a protection against financial loss
arising on the happening of an unexpected event. It is essential that: The
calamity is either natural or unexpected The insured person does not gain out
of this arrangement..

SCOPE OF INSURANCE

We all know that assets are insured, because they are likely to be destroyed
or made nonfunctional before the expected life time, through accident
occurrences. Such possible occurrences are called perils. Perils are the
events. Risks are the consequential losses or damages. The risk to an owner
of a building may be a few lakhs or a few crores of rupees, depending on the
cost of building, the contents in it and the extent of damage. The risk only
means that there is a possibility of loss or damage. Insurance is done against
the possibility that the damage may happen. There has to be an uncertainty
about the risk. The word “possibility” implies uncertainty. Insurance is
relevant only if there are uncertainties. Insurance does not protect the asset.

7
INJ BUSINESS SCHOOL
Greater Noida
It does not prevent its loss due to the peril. The peril cannot be avoided
through insurance.The risk can sometimes be avoided, through better safety
and damage control measures. It only tries to reduce the impact of the risk on
the owner of the asset and those who depend on that asset. They are the ones
who benefit from the asset and therefore, would lose, when the asset is
damaged. Insurance compensates for the losses- and that too, not fully. In
conclusion we can say that the scope of insurance is very broad and specific
because it reduces the losses and risk of owner of the assets due to perils. It
also gives supports to the person in the period of adverse situation. It insured
economic consequences. When a person saves, the amount of funds available
at any time is equal to the amount of money set aside in past, plus interest.
Insurance has no substitute and one more thing about the insurance is that
this is not similar to a hire purchase scheme. In the event of death, the
balance installments are not excused. They have to be paid by the surviving
family. There is a tax benefits, both in income tax and in capital gains.
Marketability and liquidity are better. Life insurance is not only the best
possible way for family protection there is no other way. The term of life is
hard but the terms of insurance are easy.

Objective of the insurance

When we talk about objective of the insurance sector we can divide it into
three categories which are thus. Broad Increased coverage of the population
Customer has a wider choice & range of products Service standards to
customer Economic Savings mobilization in this objective part the first part
deals with its market share because it deals with all people who live in India
and it has a broad market potential. So the main motto is to increase and
entice more and more people for insurance. In the second part it deals with
innovative plans and schemes for the wider choice of people and different
range of products of its competitors. It tries to serve its customer with
significant way.

Functions of Insurance

8
INJ BUSINESS SCHOOL
Greater Noida
The functions of Insurance can be bifurcated into three parts:

1. Primary Functions

2. Secondary Functions

3. Other Functions

The primary functions of insurance include the following:

1) Provide Protection - The primary function of insurance is to

provide protection against future risk, accidents and uncertainty.
Insurance cannot check the happening of the risk, but can
certainly provide for the losses of risk. Insurance is actually a
protection against economic loss, by sharing the risk with
others.

2) Collective bearing of risk - Insurance is a device to share the

financial loss of few among many others. Insurance is a mean
by which few losses are shared among larger number of people.
All the insured contribute the premiums towards a fund and out
of which the persons exposed to a particular risk is paid.

3) Assessment of risk - Insurance determines the probable volume

of risk by evaluating various factors that give rise to risk. Risk
is the basis fo determining the premium rate also
4) Provide Certainty - Insurance is a device, which helps to change
from uncertainty to certainty. Insurance is device whereby the
uncertain risks may be made more certain.

The secondary functions of insurance include the following:

1) Prevention of Losses - Insurance cautions individuals and businessmen

to adopt suitable device to prevent unfortunate consequences of risk by
observing safety instructions; installation of automatic sparkler or
9
INJ BUSINESS SCHOOL
Greater Noida
 alarm systems, etc. Prevention of losses causes lesser payment to the
assured by the insurer and this will encourage for more savings by way
of premium. Reduced rate of premiums stimulate for more business
and better protection to the insured.

2) Small capital to cover larger risks - Insurance relieves the businessmen

from security investments, by paying small amount of premium
against larger risks and uncertainty.

3) Contributes towards the development of larger industries Insurance

provides development opportunity to those larger industries having
more risks in their setting up. Even the financial institutions may be
prepared to give credit to sick industrial units which have insured their
assets including plant and machinery.

The other functions of insurance include the following:

1) Means of savings and investment - Insurance serves as savings and

investment, insurance is a compulsory way of savings and it restricts
the unnecessary expenses by the insured's For the purpose of availing
income-tax exemptions also, people invest in insurance.
2) Source of earning foreign exchange - Insurance is an international
business. The country can earn foreign exchange by way of issue of
marine insurance policies and various other ways.
3) Risk Free trade - Insurance promotes exports insurance, which makes
the foreign trade risk free with the help of different types of policies
under marine insurance cover

10
INJ BUSINESS SCHOOL
Greater Noida
 INDUSTRY PROFILE

INSURANCE:
Insurance can be defined as assurance for uncertainty. Insurance is about
something going wrong. Its’ often about things going right.; One of the
Wonders of human nature is that we never believe anything can actually go
wrong. The insurance sector in India has come a full circle from being an
open competitive market to nationalization and back to liberalized market
again. Tracking the development in Indian insurance sector reveals the 360
degree turn witnessed over a period of almost two centuries. The business of
life insurance in Indian in its existing form started in India in the year 1818
with the establishment of Oriental Life. Insurance Company in Calcutta.
Some of the important milestones in life insurance business in India are.
1912: The Indian Life insurance Companies Act enacted as first statue to
regulate the life insurance business.
1928: The Indian Insurance Compan9es Act enacted to enable the
government to collect statistical information about life and non-life insurance
businesses.
1938: Earlier legislation consolidated and amended to by the insurance Act
with the objective of protecting the interests of the insuring public.
1965: 245 Indian and foreign insurers and provident societies take over by
the central government and nationalized. LIC formed by an act of parliament
viz. LIC. Act. 1956, with a capital contribution of Rs. 5 Crore from the
government of India.

INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY

Reforms in the Insurance sector were initiated with the passes of the IRDA
Bill in Parliament in December 1999. The IRDA since its incorporation as a
statutory body in April 2000 has fastidiously such to its schedule of framing
regulations and registering the private sector insurance companies. The other
d4ecisoin taken simultaneously to provide the supporting systems to the
insurance sector and in particular the life insurance companies was the
launch of the IRDA online service for issue and renewal of licenses to
agents.
COMPANY PROFILE
11
INJ BUSINESS SCHOOL
Greater Noida
HDFC Standard Life Insurance Company Ltd
HDFC Standard Life Insurance Co. Ltd was incorporated on 14th august
2000. It is a joint venture between Housing Development Finance
Corporation Limited (HDFC Ltd.) India And UK based Standard Life
Company. Both the joint venture partners being one of the leaders in their
respective areas came together in this 81.4:18.6 joint venture to form HDFC
Standard Life Insurance Company Limited. Mr. Deepak Satwalekar is the
MD and CEO of the venture .HDFC Standard Life brings to you a whole
range of insurance Solutions is it group or individual or NAV services for
Corporations, they can be easily customized as per specific needs. HDFC
Standard Life Insurance India boasts of covering around 8.7 lakh lives by
March'2007. The gross incomes standing at a whopping Rs. 2, 856 crores,
HDFC Standard Life Insurance Corporation is sure to become one of the
leaders and the first preference for any life insurance customer.

HDFC LIMITED

HDFC was incorporated in 1977 with the primary objective of meeting a

social need – that of promoting home ownership by providing long-term
finance to households for their housing needs. HDFC was promoted with an
initial share capital of Rs. 100 million.
Business Objectives:-
The primary objective of HDFC is to enhance residential housing stock in the
country through the provision of housing finance in a systematic and
professional manner, and to promote home ownership. Another objective is
to increase the flow of resources to the housing sector by integrating the
housing finance sector with the overall domestic financial markets.

12
INJ BUSINESS SCHOOL
Greater Noida
STANDARD LIFE
Standard Life is Europe’s largest mutual life assurance company. Standard
Life, which has been in the life insurance business for the past 175 years is a
modern company surviving quite a few changes since selling its first policy
in 1825. The company expanded in the 19th century from kits original
Edinburgh premises, opening offices in other towns and acquitting other
similar businesses. Standard Life Currently has assets exceeding over £ 70
billion under its management and has the distinction of being accorded
“AAA” rating consequently for the six years by Standard and Poor.

SNAPSHOT
· Founded in 1875, company supporting generation for last 179 years.
· Currently over 5 million Policy holders benefiting from the services
offered.
· Europe’s largest mutual life insurer.

JOINT VENTURE

HDFC STANDARD LIFE

MISSION:-

HDFC Standard Life aims to be the top new life insurance company in the
market. This does not just mean being the largest or the most productive
company in the market, rather it is a combination of several things like:
 Customer service of the highest order,
 Value for money for customers,
 Professionalism in carrying out business,
 Innovative products to cater to different needs of different customers,

13
INJ BUSINESS SCHOOL
Greater Noida
 Use of technology to improve service standard,
 Increase the market share.

VALUES:-

1.SECURITY: Providing long term financial security to its policy holders

will be the company’s constant endeavor. It will do this by offering life
insurance and pension products.

2.TRUST: HDFC Standard Life appreciates the trust placed by its policy
holders in it. Hence, it will aim to manage their investments very carefully
and live up to this trust.

3. INNOVATION: Recognizing the different needs of its customers, it will

be offering a range of innovative products to meet these needs. The
company’s mission is to be the best new life insurance company in India
these are the value that will guide it in this.

Values:-
1. Security: Providing long term financial security to its policy
holders will be the company’s constant endeavor. It will do
this by offering life insurance and pension products.
2. Trust: HDFC Standard Life appreciates the trust placed by its
policy holder in it. Hence, it will aim to manage their
investments very carefully and live up to this trust.
3. Innovation: Recognizing the different needs of its customers,
it will be offering a range of innovative products to meet
these needs. The company’s mission is to be the best new life
insurance company in India and these are the values that will
guide it in this.

FINANCE DEPARTMENT AT HDFC STANDARD LIFE

14
INJ BUSINESS SCHOOL
Greater Noida
The finance department of HDFC Standard Life Insurance is headed by the
General Manager (Finance), who reports to the MD and CEO. There are four
other departments under the Finance Departments. These are:
1. Accounts Department
2. Actuary Department
3. Investment Department
4. Underwriting Department
The Accounts Department:

The Accounts Department functions like any other Accounts department. It

is concerned with the disbursement of salaries, reimbursements, incentives,
commissions to agents. It also handles the payments due to other agencies
with which the Company interacts, viz. event management companies etc.
The work of an Accounts department assumes much importance in an
insurance company because it has to be able to pay the claims arising time to
time.
The Actuary Department:

The Actuary Department is the “Pricing Department” of an insurance

company. It must be understood that the basic premise on which the
insurance companies work is “use the corpus of policy holders for
disbursement for any claim”. Based on this principle, this department decides
the amount of premium to be charged from a client for a particular policy.
This is normally done with the help of Mortality Tables, which can either be
prepared by the company itself, or the company can use the existing tables
available for its use. The IRDA (Insurance Regulation Development
Authority) has prescribed the use of the mortality tables used by LIC for all
other companies.
The Actuary Department is also responsible for Asset-Liability Management
of the insurance company. It must ensure that the Solvency margin (Assets-
Liabilities) must be at least Rs 50 crores, as prescribed by IRDA. 95% of the
surplus above this has to be distributed to the investors a bonus. HDFC
Standard Life has till now declared three bonuses to its policyholders

The Investment Department:

The Investment Department is responsible for the investment of the money
of the investors. Since the basic reason for the investors investing their
15
INJ BUSINESS SCHOOL
Greater Noida
money in Life Insurance is security, IRDA has put certain regulations on
such companies for investments so that the money of investors is safe.

These guidelines are:

1. Not less than 50% of the corpus will be invested in Government Securities
(G-Sec)
2. Up to15% of the corpus will be invested in infrastructure, social and rural
sectors.
3. Not less than 20% can be invested in government and other equities.
4. Remaining 15% can be invested in “unapproved” equities. Till recent time,
HDFC has not been investing in equities. But now it has decided to follow
the footsteps of its Joint-Venture partner Standard Life, which invests around
75% of its corpus in equities. The Investment Department is also responsible
for calculating the returns of the investment to the investors. Here also the
insurance companies are bound by regulations and guidelines. According to
IRDA, the returns have to be in the range of 6 %-9 %.

The Underwriting Department

This department is responsible for taking the decision on whether to insure a
person or not. For this it must take into account the risk premium associated,
the reinsurance opportunities etc. normally, there are charts available with
the people of this department on the basis of which they can come to a viable
decision.
Underwriting is done on the basis of two grounds:

1. Financial Grounds: here the underwriters decide on the worth of the

person by taking into account his tax returns of the last three years. On
this basis they are able to assess the premium paying ability of that
person and accordingly take a decision.

2. Medical Grounds: each new customer is required to undergo

comprehensive medical test, which determines the person’s general
health. On the basis of this report, the underwriters decide upon the
premium to be charged from customer.

16
INJ BUSINESS SCHOOL
Greater Noida
 SOME TERMS ABOUT ULIP PLANS

Fund Management
The crux of the entire product is the returns that this product can generate
and this is dictated by the management of the fund. There is no great value in
doing well in all other aspects of the product delivery if the fund does not
perform well. The insurance company has two options with regards to the
management of the fund i.e. external and internal. External funds usually be
having an in-house investment team and this could be extended to
management of the funds too. The expenses and hence the cost should be
kept in mind as by nature the unit linked insurance product is a very
transparent product and hence this would become a significant selling point
in the long run.

Charges and Expenses

There are different charges that can be levied by the insurance companies,
some of the more common ones are:
1) Initial charges
2) Annual charges
3) Investment charges
4) Morality charges
5) Surrender charges

Initial charges
Initial charges are applied at the time of setting up the policy; this could be in
the form of a bind offer spread and also in the form of allocation of units
known as the allocation factor. It is also possible to be levying a per member
level charge.

Annual charges
The annual charges can either be fixed or can be linked to the size of the
fund. It could also be linked to the number of members in the scheme. This
charge is usually taken to cover the maintenance expenses of the insurer.

Investment charges

17
INJ BUSINESS SCHOOL
Greater Noida
A fund management charge is levied to take care of the fund management
expenses depending upon whether the fund is managed internally or
externally.

Mortality charges
It is possible to have an insurance element built into the super annotations
contract and in case of a gratuity there would be an element of insurance the
degree and the form could differ from company to company. The insurance
premium can be taken as a part of the gratuity contract of it can be
administered outside this but packaged to look as if it is a whole some
product offering gratuity and insurance to the employees of the organization.

Surrender Charges
The surrender charges can be used in multiple ways. It could be used as a
way of recouping the initial outlay of the insurer in case the company decides
to withdraw in the early years of the contract or it could be used as a
deterrent for the company to shift the service provider at any point of the
contract. Usually the surrender charges/ penalty would decrease over a
period of time and would be expressed as a percentage of the fund.

Administration
The unit –linked policies are significantly complex to administer and also
would need a very highly technically trained customer service department to
handle enquiries. Much of the administer the policy, As the allocation of
units would be time dependent it is extremely important to have a very robust
system that can take care of allocation, de allocation and reallocation of
units. It is essential to have a system that would be able to talk/ interact with
other systems to capture the unit price details, to give outputs to accounting
packages, report generators etc.

INDIVIDUAL PRODUCTS:

18
INJ BUSINESS SCHOOL
Greater Noida
Each of us leads a unique life and so has unique needs. HDFC Standard
Life offers a range of products and invites you to choose the one that suits
you best.

PLAN
Savings Plans
Endowment Assurance Plan
Unit Linked Endowment Plan
Children’s plan
Money Back Plan
Unit Linked Young Star Plan
Investment Plans
Single Premium Whole of Life Investment with Life Insurance
Plan
Protection Plans
Term Assurance Plan
Loan cover term Assurance Plan Life Insurance at an affordable
Retirement Plans
Personal Pension Plan
Unit Linked Pension Plan
BENEFIT
Life Insurance with Savings
Life Insurance & Savings with
choice of investments funds
Financial Security for your child
Financial Security for your child
with choice of investment funds
Life Insurance with Savings
Life Insurance Customized for
home loans
price
Savings for retirement
Retirement Savings with a
choice of investment funds

Endowment Assurance Plan

19
INJ BUSINESS SCHOOL
Greater Noida
Endowment assurance plan is a participating (with profits) insurance plan
that offers the following features: Provides financial support to the family by
way of a lump sum payment in case of the unfortunate death of the life
assured within the term of the policy. Provides a lump sum payment to the
life assured on survival up to maturity this plan is with profits saving plan
and is well suited for saving money for your long term financial goals. This
plan also helps provide for the needs of your family in your absence by
paying out a lump sum in the event of your unfortunate death during the term
of the policy.
Optional benefits
You can add the following optional benefits to customize your policy to suit
your needs:
Critical
 Illness (CI) Benefit provides an amount, equal to the sum assured
chosen under this optional benefit, on diagnosis of any one of the 6 common
critical illnesses(1). The sum assured is payable if you survive for 30 days
after the date of the claim. Once such a claim has been met, no further
Critical Illness Benefit is payable. However, your basic policy continues
even after we pay a claim on this benefit.

Additional
 Term Benefit (ATB) provides an additional amount equal to
the sum assured chosen under this optional benefit, in case of your
unfortunate death.

Accidental
 Death Benefit (ADB) provides an additional amount, equal to
the sum assured chosen under this optional benefit, in case of your
unfortunate death : - due to an accident and within 60 days of an accident.

Waiver
 Of Premium (WOP) Benefit waives the premium for you in case
you become totally disabled. The waiver is applicable during the period of
total disability. This plan can be taken on a single life basis or a joint life
(first claim) basis.

Eligibility
This plan can be taken as a single life basis or a joint life (first claim) basis.
The eligibility ages are as follows:

20
INJ BUSINESS SCHOOL
Greater Noida
 Basic Basic Policy with optional benefits
Policy CI ATB ADB WOP
Min age of entry 12 18 18 18 18
Max age of entry 60 55 60 55 50
Max age of 75 70 75 65 60
expiry
Minimum term: 10 years Maximum term: 30 years

Tax Benefits
Tax benefits described in Section 88, Section 80D and Section 10 (10D) of
the income Tax Act are applicable. Applicable to premium paid for CI and
WOP
Payment options
You have the choice of paying your premium either in yearly, half yearly or
quarterly modes, depending on your convenience.

21
INJ BUSINESS SCHOOL
Greater Noida
Unit Linked Endowment Plan:

The unit linked endowment plan is an insurance policy that is designed to

pay a lump sum on maturity or on earlier death. The Unit Linked Endowment
Plan also gives the option of additional protection against the six common
critical illnesses, as well as additional protection if death is as the result of an
accident. Your premiums are invested in units of the investment fund of your
choice, based on the prevailing unit price. On maturity you receive the value
of your units. On death (or critical illness, if chosen) you receive the greater
of the value of your units and your selected basic sum assured.

Premiums
Premiums can be paid either quarterly, half-yearly or annually, throughout
the term of the policy. The minimum premium amount is Rs. 10,000 each
year. Premiums can be paid by cash, cheque or demand draft.

Benefits
There are 4 different options available to choose from:

1. Life Option
On death within the policy term, the greater of the Sum Assured and the
value of the unit-linked fund will be paid to your nominee. On survival to the
end of the policy term the value of the unit linked fund will be paid to you.

2. Life and Health Option

On death or earlier diagnosis of any one of six common critical illnesses
within the policy term, the greater of the Sum Assured and the value of the
unit-linked fund will be paid to your nominee. On survival to the end of the
policy term the value of the unit-linked fund will be paid to you.
“The illnesses covered under this option are cancer, coronary artery by
pass graft surgery, heart attack, kidney failure, major organ transplant
(as recipient) and stroke”.

3. Extra Life Option

22
INJ BUSINESS SCHOOL
Greater Noida
This option pays the same benefits as the Life Option but, should death occur
within the policy term as the result of an accident, an extra benefit equal to
the Sum Assured will be paid.

4. Extra Life and Health Option

This option pays the same benefits as the Life and Health Option but, should
death occur within the policy term as the result of an accident, an extra
benefit equal to the Sum Assured will be paid.

Levels of protection
Depending on your age at entry, you may choose between 3 levels of cover –
Low, Medium or High. For each level the Sum Assured is based on the
amount of premium you pay each year. The Sum Assured can not be changed
during the term of the contract.

Age at entry Levels of cover

Low Medium High
18 to 40 5Xpremium 10XPremium 20Xpremium
41 to 50 5Xpremium 10XPremium
Over 51 5Xpremium

Eligibility
The age and term limits for taking out a Unit Linked Endowment
Plan are: (Years)
23
INJ BUSINESS SCHOOL
Greater Noida
 Minimum Maximum Maximum
Minimum Maximum
age at age at age at
term term
entry entry expiry
Life 10 10 30 18 60 75
Life and
10 30 18 55 65
health
Extra life 10 30 18 55 70
Extra life
and 10 30 18 55 65
health

The alteration of premium, surrendering of the policy, conditions on stopping

of payment of premiums and charges are the same as that of the unit linked
pensions plan.

Tax Benefits
Tax benefits under section 88 and section 10 (10D) of the income tax act are
applicable.

Surrendering the policy

The policyholder can surrender the policy at any point of time during the
contract term. The amount payable will be the unitized fund value after
applying additional surrender charges mentioned below.

Accessing money?
You can make lump sum withdrawals from you funds provided the fund
balance after withdrawal and charges does not fall below the Sum Assured.
The minimum withdrawal amount is Rs. 10,000.

24
INJ BUSINESS SCHOOL
Greater Noida
Children's Plan

Children’s Plan is designed to provide a lump sum to the child at maturity. It

also provides financial security to the child in the future even in case of the
insured parent’s unfortunate death during the policy term. Children’s Plan
receives simple reversionary bonuses which are usually added annually. This
is a flexible plan with three options for you to choose from, depending on
your requirements. The details of these options are explained in the next
section.
Options
You will have the choice of 3 options at the start of the policy.

Option On the death of the On maturity

insured parent
during the policy
term
Maturity Benefit Future premium
Plan waived and the
policy continues till
maturity.
Accelerated Benefit Sum assured+ On the survival of
Plan bonuses paid and the the insured parent to
policy stops. the maturity date,
sum assured+
bonuses paid.
Double Benefit Plan Sum assured paid, Sum assured+
future premiums Bonuses paid.
waived, and the
policy continues till
maturity.

25
INJ BUSINESS SCHOOL
Greater Noida
Tax Benefits

The premiums you pay will be eligible for tax relief under Section 88 of the
Income Tax Act, 1961. The benefits received under the policy are eligible for
tax relief under Section 100 (10D) of the income tax act, 1961.

Eligibility
The eligibility ages for the life assured under the plan are as follows:

Minimum age of entry 18 years

Maximum age of entry 60 years
Maximum age of maturity 75 years

Term of policy

Min. Term: 10 years Max. Term: 25 years

Payment options
You have the choice of paying the premium either in yearly, half yearly or
quarterly modes, depending on your convenience.

26
INJ BUSINESS SCHOOL
Greater Noida
Unit Linked Young Star Plan

HDFC Unit Linked Young Star Plan is designed to provide a lump sum to
the child at maturity. It also provides financial security to the child in the
future, even in case of the insured parent's unfortunate death during the
policy term. The Unit Linked Young Star Plan also gives the option of
additional protection against the six common critical illnesses. Your
premiums are invested in units of the investment funds of your choice, based
on the prevailing unit prices. On maturity the value of the units will be paid.
On death (or critical illness, if chosen) the selected basic sum assured is paid,
and the policy continues until maturity. Following a valid death or critical
illness claim, we will pay the future premiums (at the level originally chosen
at inception) into your policy, as and when they would have fallen due.
Premiums
You agree to pay a level premium regularly, either quarterly, half yearly or
annually, throughout the term of the policy. The minimum premium amount
is Rs. 10,000 each year. Premiums can be paid by cash, cheque or demand
draft.

Benefits
There are 2 different options available:

1. Life Option
This option consists of a Maturity Benefit and a Death Benefit. The Maturity
Benefit will pay the value of the unit-linked fund at the end of the policy
term.

The Death Benefit will pay the basic Sum Assured on death of the life
assured during the policy term. Following payment of this benefit, no further
premiums are due from the policyholder. Following a valid death claim, we
will pay future premiums on your behalf, as and when they become due. The
level of premium will be that chosen by you at inception of the policy.

2. Life and Health Option:-

27
INJ BUSINESS SCHOOL
Greater Noida
This option consists of a Maturity Benefit, a Death Benefit and an Extra
Health Benefit. The Maturity Benefit will pay the value of the unit-linked
fund at the end of the policy term. The Death Benefit will pay the basic Sum
Assured on death of the life assured during the policy term. Following
payment of this benefit, no further premiums are due from the policyholder
and the Extra Health Benefit will lapse without value. The Extra Health
Benefit will pay the basic sum assured on diagnosis of any one of six critical
illnesses during the policy term. Following payment of this benefit, no
further premiums are due from the policyholder and the Death Benefit will
lapse without value. The illnesses covered under this benefit are cancer,
coronary artery by pass graft surgery, heart attack, kidney failure, major
organ transplant (as recipient) and stroke. Following a valid death or critical
illness claim, we will pay future premiums on your behalf, as and when they
become due. The level of premium will be that chosen by you at inception of
the policy.

Eligibility
The age and term limits for taking out a Unit Linked Young Star Plan are:

Minimum Maximum Minimum Maximum Maximum

term term age at age at age at
entry entry expiry
Life 10 25 18 60 75
Option

Life 10 25 18 55 65
and
Health
Option

Surrendering the policy

28
INJ BUSINESS SCHOOL
Greater Noida
The policyholder can surrender the policy at any point of time during the
contract term. The amount payable will be the unitized fund value after
applying additional surrender charges mentioned below.

Accessing money
You can make lump sum withdrawals from you funds provided the fund
balance after withdrawal and charges does not fall below Rs. 15,000. The
minimum withdrawal amount is Rs. 10,000.

Children's Plan

Children’s Plan is designed to provide a lump sum to the child at maturity. It

also provides financial security to the child in the future, even in case of the
insured parent’s unfortunate death during the policy term. Children’s Plan
receives simple reversionary bonuses, which are usually added annually.
This is a flexible plan with three options for you to choose from, depending
on your requirements. The details of these options are explained in the next
section.
Options
You will have the choice of 3 options at the start of the policy.
Option On the death of the On maturity
insured parent
during the policy
term
Maturity Benefit Future premium
Plan waived and the
policy continues till
maturity.
Accelerated Benefit Sum assured+
On the survival of
Plan bonuses paid and the
the insured parent to
policy stops. the maturity date,
sum assured +
bonuses paid.
Double Benefit Plan Sum assured paid, Sum assured+
future premiums Bonuses paid.
waived, and the
29
INJ BUSINESS SCHOOL
Greater Noida
 policy continues till
maturity.

Tax Benefits
The premiums you pay will be eligible for tax relief under Section 88 of the
Income Tax Act, 1961. The benefits received under the policy are eligible for
tax relief under Section 100 (10D) of the income tax act, 1961.
Eligibility
The eligibility ages for the life assured under the plan are as follows:

Minimum age of entry 18 years

Maximum age of entry 60 years
Maximum age of maturity 75 years

Term of policy
Min. Term: 10 years Max. Term:
25 years

Payment options
You have the choice of paying the premium either in yearly,
half yearly or quarterly modes, depending on your
convenience.

30
INJ BUSINESS SCHOOL
Greater Noida
Money Back Plan

It is a participating (with profits) insurance plan that offers the following

features:
Payment of cash lump sum, each of which is a proportion of the basic sum
assured, at 5-year intervals during the term of the policy. (Please refer to the
table given below.)
on survival up to maturity, a payment equal to the basic sum assured plus
any bonus additions less the cash lump sums paid earlier is provided.
In case of the unfortunate death of the life assured within the term of the
policy, the basic sum assured plus any bonus additions is provided. This is
over and above the earlier payouts. This plan helps you plan for future
anticipated expenses by paying periodic cash lump sum to you at regular
intervals. This plan also helps provide for the needs of your family in your
absence by paying them the basic sum assured plus any bonus additions in
the event of your unfortunate death during the term of the policy.
Benefits
You can add the following optional benefits to customize your policy to suit
your needs:

Critical Illness (CI) Benefit provides an amount, equal to the sum assured
chosen under this optional benefit, on diagnosis of any one of the 6 common
critical illnesses. The sum assured is payable if you survive for 30 days after
the date of the claim. Once such a claim has been met, no further Critical
Illness Benefit is payable. However, your basic policy continues even after
we pay a claim on this benefit.
Additional Term Benefit (ATB) provides an additional amount, equal to
the sum assured chosen under this optional benefit, in case of your
unfortunate death.
Accidental Death Benefit (ADB) provides an additional amount equal to
the basic sum assured in case you die:
- Due to an accident, and
- Within 90 days of the accident.
Waiver Of Premium (WOP) Benefit waives the premium for you in case
you become totally disabled. The waiver is applicable during the period of
total disability. All optional benefits must be selected at the outset of your
plan.
31
INJ BUSINESS SCHOOL
Greater Noida
Eligibility
This plan can be taken on a single life basis or a joint life (first claim) basis.
The eligibility ages are as follows:

Basic Basic Policy with optional benefits

Policy
CI ATB ADB WOP
Min age of entry 12 18 18 18 18
Max age of entry 60 55 60 55 50
Max age of expiry 75 70 75 65 60

PAYMENT OPTIONS
You have the choice of paying your premium either in yearly, half yearly or
quarterly modes, depending on your convenience.

SINGLE PREMIUM WHOLE LIFE INSURANCE

Single Premium Whole of Life Insurance Plan is well suited to meet your
long term investment needs. This participating (with profits) plan offers you
the following
Benefits:
A sound investment:
Your money will be invested in our With Profits fund. The fund aims to
provide secure and stable long term growth. Normally, we will declare a
compound reversionary bonus for your policy every year and add it to your
policy on its anniversary. In addition, on death, surrender or on the
guaranteed dates, a terminal bonus might be payable. You pay a single
premium and the policy will pay you a lump sum.

Flexibility of term:
Even after choosing your policy, you can decide on the policy term. For 4
weeks after any one of the 10th, 15th, 20th and subsequent five-year
32
INJ BUSINESS SCHOOL
Greater Noida
anniversaries, you can choose to receive the sum assured plus any attaching
bonuses, in full. Once the money has been received, your policy will cease.

Surrender value:
You can terminate the policy any time, after it has been in force for at least 6
months, and receive a surrender value.
In case of unfortunate death:
Your nominee gets the sum assured secured by your premium, plus any
attaching bonuses.
No medical requirements:
We do not require you to undergo any medical test for this plan.
Eligibility
You can buy the product on a single life basis.
Tax benefits
Tax benefits under Section 88 of the income Tax Act are applicable on
premiums up to 20% of the sum assured.

Payment options
A single premium can be paid by cash, cheque or demand draft.
Minimum age at entry: 18 years maximum age: 75 years

PENSION PLAN
• The policy is basically a saving contract, which is designed to
provide an income for life from retirement, with an option to
33
INJ BUSINESS SCHOOL
Greater Noida
 take the lump sum elsewhere to buy the annuity, provide it is
permitted by the prevailing regulations.
• Your commitment You agree to pay a single premium or level
premiums with installments due every quarter half-year or year
throughout the deferment period of the policy, after which you
will start receiving your pension.
• Plan is basically a savings contract, which is designed to provide
an income for life from retirement. It does this by accumulating
a national lump sum on retirement, comprising of sum assured
plus any attaching bonus. Can I take the national lump sum as
cash on retirement? Subject to the prevailing legislation and
regulations, part of this can be taken as a lump sum and the rest
used to buy an immediate annuity.
Mode of premium
You can pay either a single premium or pay premiums is quarterly half
yearly or annual form by cheque, in cash or by bank drafts.

Eligibility
The age and term limits for looking out a personal pension plan area:

Minimum Maximum Maximum Maximum Minimum Maximum

term term age age of age of age of
entry retirement retirement
RP SP RP SP RP SP
10 5 40 15 18 35 60 50 70

What if I need money (Loan)?

There is no facility for loans against this contract.
Tax benefits
Tax benefits described in Section 80 CC of the income tax act are applicable
(up to Rs. 10,000)
Unit Linked Pension Plan
The unit linked pension plan is basically an insurance contract, which is
designed to provide a retirement income for life. Your premiums are invested
in units of the investment fund of your choice, based on the prevailing unit
34
INJ BUSINESS SCHOOL
Greater Noida
price. On vesting the value of your units will be used to buy your retirement
benefits. On earlier death, the beneficiary receives the value of your units
plus a cash lump sum of Rs 1000.
Premiums
You agree to pay level premiums regularly, either quarterly, half yearly or
annually, throughout the term of the policy or a single premium at the start of
the policy. The minimum premium amount for regular premium mode is Rs.
10,000 each year and for single premium, it is Rs. 25,000. To facilitate
increased investment, we allow additional single premium top-ups at any
time. The minimum single premium top-up is Rs. 5,000. Premiums can be
paid by cash, cheque or demand draft.
Benefits
At the chosen vesting date, the unitized fund value will be available to secure
pension benefits. Subject to the prevailing regulations, part of this value can
be taken in the form of a cash lump sum and the rest converted to an annuity
at the rate then offered by HDFC Standard Life. Alternatively, if it is
permitted by the prevailing regulations, the proceeds net of any cash lump
sum can be used to buy an annuity with any other insurance company who
will accept such business. The current maximum limit for any cash lump sum
is one-third of the unitized fund value on vesting. On death the unitized fund
value will be paid along with a cash lump sum of Rs. 1,000. The beneficiary
may use the proceeds to purchase pension benefits for the surviving spouse.
Your basic benefits will be paid by cheque.
Eligibility
The age and term limits for taking out a Unit Linked Pension Plan are:
(Years)
Mini Maxi Minimu Maximu Minimu Maximu
mum mum m age m age m age m age
term term of entry of entry of of
investin investin
g g
Regular 10 40 18 60 50 70
premium
version
Single 5 40 18 65 50 70
premium
35
INJ BUSINESS SCHOOL
Greater Noida
version

TAXATION

36
INJ BUSINESS SCHOOL
Greater Noida
TAX BENEFITS OF INSURANCE AND PENSION PLAN.
Life insurance and retirement plans are effective ways of saving taxes. The
tax breaks that are available under various insurance and pension policies are
described below:

1. Life insurance plans are eligible for deduction under Sec. 80C.

2. Pension plans are eligible for a deduction under Sec. 80CCC.

3. Health riders are eligible for deduction under Sec. 80D.

4. The proceeds or withdrawals of life insurance policies are exempt

under Sec 10(10D), subject to norms prescribed in that section.

Tax Rates for Individuals

The rates of income tax for FY 2005-06 are as follows:

MARKET SHARE & ITS COMPETITORS

In India there are total 22 insurance companies are existing and the
name of few companies and its market shares are listed below:
NAME OF INSURANCE MARKET SHARE IN %
COMPANIES
LIC 72.15
HDFC SLIC 3.88
37
INJ BUSINESS SCHOOL
Greater Noida
ICICI Prudential 5.91
Birla Sun Life 2.6
Bajaj Allianz 1.62
Tata AIG 1.5
SBI Life 1.19
Aviva 1.8
Max New York Life 2.4
Kotak Mahindra 1.9
ING vysya 1.2
AMP SANWAR 1
Met Life 1.4
Others 1.45

Competitors
There are total 22 insurance companies in India out of which LIC is
the only public Ltd. Company & is also very good competitor to all
the insurance company.
The top ten companies are LIC, ICICI Prudential, HDFC SLIC,
Bajaj Allianz, SBI Life, Reliance Life insurance, Birla Sun Life,
MAX New York Life, Kotak Mahindra and Aviva Life Insurance.
HDFC SLIC faces a very stiff competition with its other players
like LIC, ICICI, etc.
38
INJ BUSINESS SCHOOL
Greater Noida
Some of the competitive features are as follows:
 Large amount of competition (22 players in the market)

 Other brands are well advertised and have higher recall value

 LIC is considered a safer option

 Face competition from banks and mutual funds

 High premium policies are difficult to market

 Incorrect perception about private insurance company

 Short term plans available only at large premium

 Lack of awareness about the unit linked funds in the market

The market share of HDFC is 3.88% & LIC is 72.08% as LIC is a

public company it is the major competitor for all the other 21
insurance company in India. Most of the market concentration is
occupied by LIC.

LIFE INSURANCE CORPORATION OF INDIA

(LIC)
LIC offers 66 different plans; plans are formulated for specific
occasions – whole life plans, term assurance plans, money back
plan for women, child plans, plans for the handicapped individuals,
endowment assurance plans, plans for high worth individuals,
pension plans, unit linked plans, special plans, social security
schemes – diversified portfolio of products. HDFC SLIC has total
39
INJ BUSINESS SCHOOL
Greater Noida
25 plans, and it could diversify its product portfolio. It could add
more plans for high worth individuals and women.

ICICI PRUDENTIAL
ICICI Prudential is a stiff competitor for HDFC SLIC. The
company is a merger between ICICI Bank which is the biggest
private bank in India and Prudential Plc which is a global life
insurance company.
The company has an investment plan which is market related –
Invest Shield Life. In this plan even if the market falls, the
premium will be returned to investors. It is a guaranteed plan which
ensures the company carefully invests your money. The stock
market performance of ICICI Prudential is much better than HDFC
SLIC. The returns on the growth fund were 46.28% compared to
the 42.70% offered by HDFC SLIC. Customers are attracted by
higher returns and this is a plus point for prudential. The company
is very well advertised. The advertisements are showcased in
movies, television, newspapers, magazines, bill boards, radio etc.
The company has an excellent brand ambassador – Mr. Amitabh
Bacchan. His promotion of the company builds trust and faith in
the minds of our people. However the charges are very high in the
plans offered by ICICI Prudential. It is 35% during the first year,
15% in the next year and 3% from the third year onwards. Also a
higher minimum premium of Rs. 8,000 is charged. Hence the
policies are not accessible to the lower strata of the society.

BIRLA SUN LIFE

Birla Sun Life Insurance Company Limited is a joint venture
between The Aditya Birla Group, one of the largest business houses
in India and Sun Life Financial Inc., a leading international
financial services organization. The local knowledge of the Aditya
Birla Group combined with the expertise of Sun Life Financial Inc.,
offers a formidable protection for your future.
40
INJ BUSINESS SCHOOL
Greater Noida
The Aditya Birla Group has a turn over close to Rs. 33,000 crores
with a market capitalization of Rs. 53,400 crores (as on 31st March
2007). It has over 72,000 employees across all its units worldwide.
It is led by its Chairman – Mr. Kumar Mangalam Birla. Some of
the key organizations within the group are Hindalco and Grasim.
Sun Life Financial Inc. and its partners today have operations in
key markets worldwide, including Canada, the United States, the
United Kingdom, Hong Kong, the Philippines, Japan, Indonesia,
India, China and Bermuda. It had assets under management of over
US$343 billion, as on 31st March 2007. The company is a leading
player in the life insurance market in Canada.
Being a customer centric company, BSLI has covered more than a
million lives since inception and its customer base is spread across
more than 1000 towns and cities in India. All this has assisted the
company in cementing its place amongst the leaders in the industry
in terms of new business premium income. The company has a
capital base of 520 crores as on 31st July, 2007.
Its Flexi Life Line Plan offers life long insurance cover till the
policy holder is 100years of age. There are guaranteed returns of
3% p.a. net of policy charges after every 5 years from the eleventh
policy year onwards. However the charges are very high. The
initial charges for the first year are 65%. Hence the fund value is
greatly reduced.

BAJAJ ALLIANZ
Bajaj Allianz is a joint venture between Allianz AG with over 110
years of experience in over 70 countries and Bajaj Auto, a trusted
automobile manufacturer for over 55years in the Indian market.
Together they are committed to offering you financial solutions that
provide all the security you need for your family and yourself.
Bajaj Allianz is the number one private life insurer for the year 05 –
06. It is leading by 78 crores. It has experienced a whopping
growth of 216% in the last financial year. The company has sold
41
INJ BUSINESS SCHOOL
Greater Noida
13, 00,000 policies and is backed by 550 offices across India. It
offers travel insurance, motor insurance, home insurance, health
and corporate insurance. The mortality charges are lower than
HDFC SLIC. The entry age could be zero years which allow even
new born babies to be insured.

42
INJ BUSINESS SCHOOL
Greater Noida
TATA AIG
Tata AIG is a joint venture between the Tata group and American
International Group Inc. In one of the plans the company offers
hospital cash benefit wherein it will pay Rs. 2500 per day in case of
hospitalization and Rs. 12.5 lakhs in case the person suffers from
any critical illness. Annual premium is much less (about Rs. 6712)
to avail such a good benefit. Charges are relatively low compared
to HDFC SLIC for some policies.
The company offers high coverage plans at low cost. There is a
plan even for a policy term of 1 year. Your family can continue to
enjoy their current lifestyle even in the case of something
happening to you. These plans are very flexible and HDFC SLIC
could adopt this idea of insuring individuals for short periods of
time. For example; there is a family of four. The only earning
member is the father.
He has just taken a loan from a bank of 20 lakhs to purchase a new
home. He is able to repay the loan with his current salary in 15
years. The problem arises if something were to happen to him
within these fifteen years. Not only will the family face the
emotional and financial loss of their father but they will also have
to repay the home loan or risk being homeless.

43
INJ BUSINESS SCHOOL
Greater Noida
 COMPETITIVE ANALYSIS
HDFC Pension plan Vs BIRLA Flexi Secure Life
Retirement Vs Bajaj Allianz Unit Gain Vs LIC Bima
Plus

Features HDFC BIRLA Bajaj LIC Bima

Pension Flexi Allianz Plus
Plan Secure Life Unit Gain
Retirement
Age 18-60 years 18-60 years 0-60 years 12-55 years
Term 10-30 years Minimum Choice 10 years
Term of 10 rests with
years the
consumer
with a mini
mum
premium
payment
term of
3years
Sum Only 5, 10, Minimum Minimum Maximum
Assured 20(age Sum Sum limit up to
based) Assured is Assured is Rs. 2 lakhs.
multiples Rs. 50,000. 5 times the
are allowed Zero Death premium
as Sum Benefit is paid.
Assured. also
available.

44
INJ BUSINESS SCHOOL
Greater Noida
Survival Value of Unit Value Value of Bid Value
Benefit units partly is used to fund at Bid of the fund
in cash purchase an Price. units.
partly annuity.
converted to
annuity.
Death Value of Value of
Higher of Death
Benefit units, no units in this
sum during the
sum assured case the
assured or first 6
is given. sum assured
value of months-
is zero.units. 30% of SA
+ value of
units, next
6 months-
60% of SA
+ value of
units.
Death after
1st year- SA
+ value of
units.
Death
during the
10th year-
105% of
SA + value
of units.
Withdrawal No partial No partial Partial or Premature
Benefit withdrawals withdrawals complete withdrawal
are are withdrawal allowed
available. available. at bid price after one
rd
after 3 year (after
45
INJ BUSINESS SCHOOL
Greater Noida
 year. applying
bid-offer
spread).
Contd…..
Contributio Minimum Minimum Minimum: Minimum: Rs.
n/ Premium : Rs. : Rs. Rs. 10,000 10,000 p.a.
10,000 5,000 p.a. p.a.
p.a.
Flexible Available Not Only an Not available
Contributio available increase in
n contributio
n is
allowed.
Investment 7 fund Nourish, Equity Balanced,
Options options- Growth fund, Debt Secured & Risk
Liquid and fund,
fund, Enrich Balanced
Stable fund &
fund, Cash fund
Secure
managed
fund,
Defensiv
e
managed
fund,
Balanced
fund,
Equity &
Growth
fund.
Surrender The Surrender A selling/ Partial
value surrender is purchase surrender up to
46
INJ BUSINESS SCHOOL
Greater Noida
 is 25% of available price 50% of bid
3 years offrom the spread of 5 value of units
regular first year % will be allowed after 3
premium. itself. In applicable years from the
No the 1st from the date of
charges year 3rd year commencement
after 3 surrender onwards. s.
years. charges
are 75%,
in the 2nd
year the
charges
are 50%,
in the 3rd
year the
charges
are 25%
Top-up Available Available Available Available
with a , with a (charges: 1.5%
minimum minimum of the top-up)
top-up of top-up of
Rs. 5,000 Rs.
and 10000
maximu
m of 20%
of sum
assured.
Switch 24 2 free Three free No free
switches switches switches switches. Cost
are free. every every of switching is
year. policy 2% of the fund
Every year. value.
additional Subsequen
47
INJ BUSINESS SCHOOL
Greater Noida
 switch t switches
will be would be
charged charged
at 0.5% @1% of
of the switch
switch amount or
amount. Rs. 100,
whichever
is higher.

Initial Charges: Charges: Charges: Not

charge 1st year- 20% of the st
1 year- disclosed
27%, 2nd initial 70%, 2 nd

year- 27%, premium in year- 2%,

3rd year the first 3rd year 1%,
onwards- year and no charges
1% 2% of the from the 4th
premium year
from the onwards.
2nd year
onwards.
Admin Admin Policy Annual Not
charge charges of admin fee admin applicable
Rs. 180 of Rs. 20/ charges of
fixed month 1.25% p.a.
charge p.a. of net assets
Fund Least in the A fund Annual 1% of the
management industry based fee investment fund per
charges 0.8% of the of 2.25% charge of annum
fund p.a. p.a. of the 1% p.a. of
policy fund fund
Bonus units Available Not Not Available
available available
48
INJ BUSINESS SCHOOL
Greater Noida
 Comparison of Children’s plans

Min- Fund Minimum

Partial Surrender
Minimum Death Premium
Company Max Allocation Maturity Benefit
Payment
Withdrawal Value
Premium Benefit (year) (year)
Age Charges Term

49
INJ BUSINESS SCHOOL
Greater Noida
 100% of
sum
assured.
Company
will pay
all future
premiums
Life
at one
Insured: 1st yr:
time. 100%
21-50 26%-30% Accumulated After
Family value
Smart Step yrs, Rs. 20000 2nd yr
income
amount till 3 yrs completion
after 10th
maturity date. of 5 yr
plus child: onwards:
benefit yr
3 mnths- 2%
rider
15 yrs
ensures a
regular
income
every year
(5% of
sum
assured).
1st yr: Accumulated
amount till
15%
100% of maturity date.
Life 2nd yr: After
sum
Insured: 10%
assured. completion of After
100%
20-60 3rd yr: 8% 10yrs, every 3 or 5 value
Smart Kid yrs, Rs. 12000 Company 6th yr yours yrs
completion
after 5th
4th yr to 5 of 5 yr
Maxima child: will pay Accumulated yr
th yr: 6%
all future value will be
0-15 yrs 6th yr
premiums. added with
onwards: 60% of total
4% premium paid.
Life Rs. 15000 1st yr: 100% of Accumulated 3 or 5 After 100%
Headstart Insured: 18%-30% sum amount till yrs completion value
Future 18-60 2nd yr: assured. maturity of 5 yr after
Protect yrs, 6%-14% Company date. 5th yr
child: 3rd yr: will pay
0-17 yrs 4%-7% all future
4th yr premiums
onwards: at one
50
INJ BUSINESS SCHOOL
Greater Noida
 0% time.
100% of
sum
assured.
Life Company
1st yr to Accumulated
Insured: will pay
3rd yr: amount till 100%
18-50 all future After
Saral yrs, 17% maturity date value
Rs. 10000 premiums 10 yrs completion
Children child: 4th yr with after
at one of 3 yr
Plan 30 days- onwards: guaranteed 3rd yr
time.
4% benefits.
13 yrs Riders are
also
available
with this.
100% of
sum
1st yr: assured.
29% Company
Life 2nd yr to will pay Accumulated
Insured: 3rd yr: 5% all future amount till 100%
After
Children 18-55 Rs. 10000
4th yr premiums maturity date
3 yrs completion
value
Fortune yrs, onwards: as a lump with
of 3 yr
after
Plus child: 2.5% sum in guaranteed 3rd yr
0-17 yrs 8th yr one benefits
onwards: stroke.
1% Riders are
also
available.

51
INJ BUSINESS SCHOOL
Greater Noida
 RESEARCH METHODOLOGY

Study
The present investigation is a descriptive type of study undertaken to
estimate the comparative study of pension plan of HDFC SLIC, BIRLA SUN
LIFE, BAJAJ ALLIANZ, LIC.

Sample size
For the purpose of analysis a sample size of different companies were
selected. The sample size taken was from some leader companies of the
market.

Sampling method
The sampling method used for the project was ‘Random Sampling’. This
type of sampling is also known as probability sampling where each and every
item in the population has an equal chance of inclusion in the sample and
each one of the possible samples. This procedure gives each item an equal
probability of being selected.

CONCLUSION

HDFC standard life insurance is first life insurance Company in India. It has
businesses spread out across the globe. It was registered on 23rd December
2000. It currently ranks number 4 amongst the insurers in India (Source:
annual premium provided by the company) The company faces a large
amount of competition. To sustain itself it must promote its products through
52
INJ BUSINESS SCHOOL
Greater Noida
advertising and improve its selling techniques. Consumers must be aware of
the new plans available at HDFC SLIC. The medium of advertising used
could be television since most of its competitors use this tool to promote
their products. The company must be promoted as an Indian company since
consumers seem to have more trust in investing in Indian firms. The unit
linked concept must be specifically promoted. The general perception of life
insurance has to change in India before progress is made in this field. People
should not be afraid to invest money in insurance and must use it as an
effective tool for tax planning and long term savings. HDFC SLIC could tap
the rural markets with cheaper products and smaller policy terms. There are
individuals who are willing to pay small amounts as premium but the plans
do not accept premiums below a certain amount. It was usually found that a
large number of males were insured compared to females. Individuals below
the age of 30 (mostly male) were interested in investment plans. This was a
general conclusion drawn during prospecting clients.

SUGGESTIONS

• Premium allocation charge (initial charge) should be reduced

to provide customer with better return.

• Policy administration charge should be reduced to gain more

advantage in the market.

53
INJ BUSINESS SCHOOL
Greater Noida
• Surrender charges should be reduced.

• Create a positive perception about insurance.

• Try to sell the product/plan which the consumer requires and

not the plan where the advisors benefit is higher.

BIBLIOGRAPHY

• www.hdfcinsurancei.com
• www.irda.com
• www.LICindia.com
54
INJ BUSINESS SCHOOL
Greater Noida
• www.birlasunlife.com
• www.bima deals.com
• www.google.com

55
INJ BUSINESS SCHOOL
Greater Noida