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cresit risk

  1. 1. 2010Summer Internship Project
  2. 2. “PERCEPTION STUDY ON MONEY BACK POLICY” &“COMPARISON STUDY ON PRODUCT OF RELIANCE LIFE INSURANCE WITH OTHER PRIVATE INSURANCE COMPANY” A PROJECT REPORT Submitted by Mr. Anubhav Bhushan Reg. No. – S0906 in partial fulfillment for the award of the degree of POST GRADUATE DIPLOMA IN MANAGEMENT IN MARKETING Centurion School of Rural Enterprise Management, Paralakahemundi, Odisha May – June 2010
  3. 3. “PERCEPTION STUDY ON MONEY BACK POLICY” &“COMPARISON STUDY ON PRODUCT OF RELIANCE LIFE INSURANCE WITH OTHER PRIVATE INSURANCE COMPANY” A PROJECT REPORT Submitted to: PROFESSOR K. V. RAMANA Submitted by Mr. Anubhav Bhushan Reg. No. – S0906 Centurion School of Rural Enterprise Management, Paralakahemundi, Odisha APRIL – JUNE 2010
  4. 4. BONAFIDE CERTIFICATE Certified that this project report “PROJECT REPORT ON COMPARATIVE ANALYSIS OF INSURANCE PRODUCT WITH DIFFERENT LIFE INSURANCE COMPANIES.” is the bonafide work of “ANUBHAV BHUSHAN” who carried out the project work under my supervision.SIGNATURE K. V. RAMANA Assistant Professor Centurion School of Rural Enterprise Management, Paralakhemundi, Odisha
  5. 5. DECLARATIONI hereby declare that this project work entitled “Perception study on Money Backpolicy” & “Comparison study on product of Reliance Life Insurancewith other private insurance company” is my work, carried out under theguidance of my faculty guides PROF. K.V. RAMNA and company guide Mr.VIKASH KUMAR, Branch Manager, Reliance Life insurance Company Limited,Ranchi. This report neither full nor in part has ever been submitted for award ofany other degree of either this management college or any other managementcollege.SIGNATUREMr. ANUBHAV BHUSHANREGD. NO. S0906P.G.D.M.C.S.R.E.M. , PARALAKHEMUNDI
  6. 6. ACKNOWLEDGEMENTFirst of all I would like to acknowledge our indebted to our Director Dr. (Prof.)G.C.Patro, for his valuable guidance and consistent supervision throughout thecourse.I am also thankful to Mr. VIKASH KUMAR, Company Guide of Reliance LifeInsurance company LTD, Ranchi, for his valuable guidance for preparing the FinalReport and also for providing the necessary facilities.I am extremely thankful to PROF. K.V. RAMANA , Faculty Guide of CSREM,Paralakhemundi for their timely guidance and support throughout the projectwork.Finally I am indebted to our other faculty members, my friends and my parentswho gave their full-fledged co-operation for successful completion of my project.It was an indeed learning experience for me.ANUBHAV BHUSHANRegd. No. - S0906
  7. 7. Content Page No.Project BA : Perception Study on Money Back policyChapter No. 1 1.1. Abstract …………………………...01 1.2. Introduction …………………………...02 1.3. Detail Study about Money back policy …………………………...02 1.3.1 Salient Feature …………………………..03 1.3.2 Benefit …………………………...04 1.4 Research Problem …………………………...05 1.5 Purpose of the Study …………………………..05Chapter No. 2 2.1. Research Methodology …………………………...06 2.1.1. Research Strategy …………………………...06 2.1.1.1. Primary source …………………………...06 2.1.1.1.1. Sampling Design …………………………...06 2.1.1.1.1.1 Population….…………………….06 2.1.1.1.1.2 Sample Frame……………………06 2.1.1.1.2. Sampling Element ………………………...06 2.1.1.1.3. Sample Technique ………………………..07 2.1.1.1.4. Sample Size ………………………...07 2.1.1.2. Secondary Sources …………………………07
  8. 8. Chapter No. 3 3.1. Analysis and Data Interpretation ………………………08Chapter No. 4 4.1. Results ……………………….21 4.2. Conclusion ………………………..23 4.3. Suggestion ………………………..24PROJECT - BB. Comparison study on product on Reliance Life Insurance With other private insurance companiesChapter No. 5 5.1. Objective ………………………...27 5.2. Introduction ………………………..27 5.2.1. ULIP Plan of Reliance Life Insurance ……………………….27Chapter No. 6 6.2. Compare ULIP product of Reliance Life with Mutual Fund ………………………28 6.2.1. Mode of Investment ………………………28 6.2.2. Expenses ………………………29 6.2.3. Portfolio Disclosure ………………………30 6.2.4. Flexibility in altering the assets allocation ………………………31 6.2.5. Tax Benefit ………………………32
  9. 9. SuggestionBibliographyAnnexureList of Table and FigureList of Table Particular Page No. 1. Table No. 1……….Money Back Policy plan feature…………………..04 2. Table No. 2………....Awareness of Life Insurance……….…………....08 3. Table No. 3……………….Decision Influence…………………...…….09 4. Table No. 4……………..Attraction of Insurance………………………10 5. Table No. 5…………….Purpose of buy Insurance……………………..11 6. Table No. 6………..........Investment for Insurance……………………..12 7. Table No. 7…………………Premium payment………………………...13 8. Table No. 8………………....Mode of Premium………………………...14 9. Table No. 9……………….Believable Company………………………..15 10. Table No.10………..........Types of Insurance plan…...…………………16 11. Table No.11……………Aware with Money Back………………………17 12. Table No.12………..…………No. of Policy…………………………….18 13. Table No.13…...........Interest to take Money Back policy……………….19 14. Table No.14………………….Satisfaction………………………………20
  10. 10. List of Figure Particular Page No. 1. Figure No. 1………....Awareness of Life Insurance……….…………....08 2. Figure No. 2……………….Decision Influence…………………...…….09 3. Figure No. 3……………..Attraction of Insurance………………………10 4. Figure No. 4…………….Purpose of buy Insurance……………………..11 5. Figure No. 5………..........Investment for Insurance……………………..12 6. Figure No. 6…………………Premium payment………………………...13 7. Figure No. 7………………....Mode of Premium………………………...14 8. Figure No. 8……………….Believable Company………………………..15 9. Figure No. 9………..........Types of Insurance plan…...…………………16 10. Figure No. 10……………Aware with Money Back………………………17 11. Figure No. 12………..…………No. of Policy…………………………….18 12. Figure No. 13…...........Interest to take Money Back policy……………….19 13. Figure No. 14………………….Satisfaction………………………………20
  11. 11. Chapter No. 11.1. AbstractIndia is a country where the average selling of life insurance policies is still lowerthan many western and asian countries, with the second largest population in worldthe Indian insurance market is looking very prospective to many multinational andIndian insurance companies for expanding their business and market share. Beforethe opening of indian market for Multinational Insurance Companies, LifeInsurance Corporation (LIC) was the only company which dealt in Life Insuranceand after opening of this sector to other private companies, all the world leaders oflife insurance have started their operation in India. With their world marketexperience and network, these companies have offered many good schemes to lureall type of Indian consumers but unfortunately failed to get the major share ofmarket. Still the LIC is the biggest player in the life insurance market with approx65% market share. But why Indian consumers do not trust on many companies andwhy the major population of India does not have any life insurance policy or whatare the factors plays major role in buying behavior of consumers towards lifeinsurance policies.
  12. 12. 1.2. IntroductionLife is full of risk and uncertainties. Since we are the social human being we havecertain responsibilities too. Indian consumers have big influence of emotions andrationality on their buying decisions. They believe in future rather than the presentand desire to have a better and secured future, in this direction life insuranceservices have its own value in terms of minimizing risk and uncertainties. Indianeconomy is developing and having huge middle class societal status and salariedpersons. Their money value for current needs and future desires here the pendulummoves to another side which generate the reasons behind holding a policy. Herethe attempt has been made in this research paper to study the buying behavior ofconsumers towards life insurance services.Life insurance is one of the best known insurance products today. People buy theseproducts as investment tools and also as protection for themselves and theirfamilies. All the insurance companies the world over are looking at attracting theeye balls of customer and positioning their solutions innovatively to cater to nicheand specific markets. One of the most critical aspects both from the view point ofthe customer and the insurer is getting important and relevant leads that can bebeneficial for both.
  13. 13. 1.3. Detail study about Money back Policy –MONEY BACK plan is an excellent plan with good return on reinvestment, bestsuited for businessmen and professionals. Money is available at regular intervals infuture to meet the specific expenses such as childrens education or marriage. Atthe same time, the provides insurance protection for the family as well as old ageprovision. 1.3.1 .Salient Features • where lump sum amounts are paid to the life assured at periodic intervals on survival. • In case of death of the life assured within the term, the total sum insured is paid to the nominee, irrespective of earlier survival benefits. • Bonus is payable under this scheme. • Premiums are to be paid regularly to get survival benefits. • Premiums cease at death or on expiry of term whichever is earlier. • This plan can be availed of for terms 20 or 25 years.
  14. 14. 1.3.2 . Benefits• On Death: o Full sum assured is payable at death of the life assured within the term, without any deduction of earlier survival benefits. (e.g. for example, suppose a person takes a Rs.1,00,000/- for 20 years. At the end of the 5th and 10th year he receives Rs.20,000/- each as survival benefit. If he happens to die in the 12h year, the nominee of the life assured will receive full Rs.1,00,000/-, irrespective of the earlier benefits of Rs.40,000/-)• On Survival: For Example, on a Rs. Term At the end of Amount of money back 1,00,000 5thyear 20% of sum assured Rs.20,000/- 20 10thyear 20% of sum assured Rs.20,000/- years 15thyear 20% of sum assured Rs.20,000/- 20thyear 40% of sum assured Rs.40,000/- 25 5thyear 15% of sum assured Rs.15,000/- years 10thyear 15% of sum assured Rs.15,000/-
  15. 15. 15thyear 15% of sum assured Rs.15,000/- 20thyear 15% of sum assured Rs.15,000/- 25thyear 40% of sum assured Rs.40,000/- Table No. 11.4. Research ProblemThe problem of the my research is to know perception of the customer aboutMonet Back policy in Varanasi, U.P.1.5. Purpose of the studyThe purpose of the study is know that 1. To evaluate the factors underlying consumer perception towards investment in life insurance policies. 2. To develop and standardize a measure to evaluate investment pattern in life insurance services.Research QuestionPerception study about Money back policy
  16. 16. Chapter No. 2 2.1. RESEARCH METHODOLOGY 2.1.1. .Research Strategy For my research study first of all this is very important that I have to know what is money back policy and how it works. I’ll visit Reliance Life Insurance Company in Varanasi to know more about Money Back policy.Collection of data 2.1.1.1. Primary Source – 2.1.1.1.1. Sampling Design a) Population: Population included investors in Varanasi region. b) Sample frame: Since the data was collected through personal contacts, thesample frame was the individuals who are investing in life insurance policies.
  17. 17. 2.1.1.1.2. Sampling elements:Individual respondents were the sampling elements. 2.1.1.1.4 Sampling Techniques:Purposive sampling technique was used to select the samples.2.1.1.1.5 Sample Size:Sample size was 104 respondents2.1.1.2 .Secondary SourceThe common source for secondary data includes different websites & books andReliance life insurance office in Varanasi.
  18. 18. Chapter 33.1. Analysis and data interpretation 3.1. Awareness of life insurance in consumer. Fig. 1 No. of respondants Percentage of respondents Yes 104 100% No 0 0% Table No.2According to the data Maximum people are aware with Life insurance policy; here100% people are aware with life insurance. This time in india most of the peopleaware with this investment because now a day’s people are not interested to investtheir money in bank and post office etc. but if we see in rural area , where most ofthe people is not aware with life insurance.
  19. 19. 3.2. In buying insurance policy, your decision is influenced by Figure No. 2 No. of % of respondents Respondents Family 38 37% Friends 31 30% Professional and trade union group 16 15% Brand and Advertisement 19 18% Table No. 3Insurance is now basic investment for consumers. But this is tradition of india thatwe are not believe in unknown people So when any one buy insurance policy thenhis or her decision is depend on family friends etc. here if we see 37% respondentsbelieve his family to buy insurance policy but only 18% respondent’s decisiondepend on brand and advertisement of company. so here we see that family andfriends play a big role to buy insurance policy. 3.3. What will you more attract in insurance?
  20. 20. Figure No. 3 No. of % of respondents respondents Bonus 69 66% Generated Income 31 30% Return Depend on Market 13 4% Table No. 4Mostly people invest money in insurance for his life security but now they alsothink about profit. Today people are only asking about profit that after 3 or 4 yearhow much Money Company give me. Most of the people buy insurance for Bonus,here 66% people attract by bonus and only 4% people attract by return depend onmarket.
  21. 21. 3.4.What is your purpose for buying insurance policy? Figure No. 4 No of % of Respondents respondents For old age saving 53 51% Family saving 14 14% Time to time needs 22 21% Opposite circumstances 15 14% Table No. 5Most of the people buy insurance policy for his old days saving because they wantto save money for old age and only 21% people buy insurance for time to timeneeds.
  22. 22. 3.5.How much money you want to invest in insurance? Figure No. 5 Premium No. of Amount respondents 10000 to 15000 15 15001 to 20000 29 20001 to 25000 31 25001 to 30000 21 30001 to 35000 5 Table No. 6Mostly people invest in insurance his saving amount and according to theirsaving they purchase life insurance policy. Here most of the people invest20001 Rs. To 25000 Rs. And very less number of people invest huge amount ininsurance.
  23. 23. 3.6.How do you want to pay your premium? Figure No.6 No. Of Mode Respondents Cash 36 Cheque 41 Demand Draft 27 Table No. 7Most of the respondent pay their premium through cheque there 41 respondent paytheir premium through cheque and 36 respondent pay their premium through cashand 27 respondent pay their premium through demand draft..
  24. 24. 3.7In what mode you want to give premium? Figure No. 7 No. of % of Mode Respondents respondent Monthly 27 26% Half- Yearly 41 39% Yearly 36 35% Table No. 8Insurance company give a lots of facility to his loyal costumer for pay hispremium. Coustmer also pay the premium in three mode monthly, halfyearly and yearly. Here 39 % respondent pay in half yearly mode and35% respondent pay yearly mode premium.
  25. 25. 3.8.In which company you believe most ? Figure No.8 No. of Company respondent Private Company 38 Public Company 62 Table No. 9Most of the people want to invest his money in public insurance company and inprivate insurance company only 38 respondent want to invest their money. Most ofthe people buy insurance from LIC and there are 24 private insurance company inIndia.
  26. 26. 3.9.Do you want which type of insurance plan? Figure No. 9 No. of % of PLAN Respondents respondents ULIP Plan 22 21% Traditinol Plan 41 40% Health Plan 24 23% Term plan 17 16% Table no. 10In insurance plan respondent want mostly traditional plan. 40% respondent usetraditional plan and 21% respondent want to buy ULIP Plan.
  27. 27. 3. 10. Do you aware with Money Back Policy of any life insurance company? Figure No.10 No. of % of Respondents respondents Yes 87 84% No 17 16% Table No. 11There are 84% respondents who aware about money back policy and 16%respondent have no idea about money back policy.
  28. 28. 3.11.How much Money Back policy you have? Figure No.11 No. of % of No. of policy Respondents respondents 0 17 16% 1 37 36% 2 27 26% 3 20 19% 4 and above 3 3% Table No.12There are 84% aware with Money back policy in this 84% respondent 37people have 1 money back policy and 27 people have 2 money back policy.There are 16% respondent they haven’t any money back policy.
  29. 29. 3.12.Do you interested to take Money Back policy? Figure No.12 No. of % of Respondents respondents Yes 57 71% No 28 13% Cant say 19 16% Table No. 13There are 55% respondent interested to take money back policy again but 27%respondent have no interest to take this policy again and 18% respondent don’tknow what to do.
  30. 30. 3.13.Are you satisfied with the return on investment, which you are gettingfrom your policy? Figure No. 13 No. of % of Respondents respondents Very satisfied 22 21% Satisfied 62 60% Cant say 4 4% Not Much satisfies 4 4% dissatisfied 12 11% Table No.14Here we see very positive result of my respondent about money back policyproduct. In that 84% respondent 60 % respondent satisfied with return on thismoney back policy and 21% respondent very satisfied with money backpolicy.and 11% respondent not satisfied with return on this money back policy.
  31. 31. Chapter No. 44.1. ResultsIn present Indian market, the investment habits of Indian consumers are changingvery frequently. The individuals have their own perception towards various typesof investment plans. The study of this research work was focused over consumer’sperception on investment towards money back policy of Life Insurance Services.The objectives of the study were to evaluate the factors underlying consumerperception towards investment in life insurance policies; and to compare thedifferences in consumer perception of male and female consumers.In india LIC have a 25 years monopoly and costumers were bound to buyinsurance from LIC but in 2000 maximum private insurance companies enterin the Indian insurance market and that time very less number of people wantto buy insurance from this private companies and today also if see this surveythen according to survey 62% people believe in LIC and remaining 38%people go with private companies like Reliance Life Insurance, ICICIPrudential. But today the face of insurance market is totally changed nowpeople move to private sector insurance companies. because this privatecompanies gives more bonus and return to his costumer .and costumer alsobuy that policy where he got more bonus and return. Now a day’s controversy
  32. 32. is going on between SEBI and IRDA about ULIP policies. In ULIP policiescompanies charged a huge money in first premium of his policy and thatpolicy return also depend on market if market is on peak then costumer havegood profit with good return. and insurance market is affected by thiscontroversy now people are scared to buy ULIP policy only 22% peopleinterested to buy this plan but people more attracted in traditional planbecause in this costumer have a certain return guarantee and charges also lessin comparison than ULIP policy and Money Back policy is a traditional planwhere more number of people attracted.According to survey 71% peopleinterested to buy this Money Back policy and they are satisfied with thispolicy. In 61 respondent out of 104 respondent are satisfied with Money Backpolicy.4.2. ConclusionThe perception of the Money back plan of reliance life insurance is goodtowards the costumer. In RLI Reliance Cash Flow Plan is the cash back plan.Necessarily customer need that type of plan where they get any benefit andsafety for his money and this plan is safe as well as benefitted also becausethere is a lots of benefit with this plan so this is the reason this plan is morepopular in Indian market. Savings and Investment Plan gives the double
  33. 33. benefit of easy liquidity through lump sum cash along with life insurance.During the time of need this policy provides the money at times. This policygives the freedom to the insured to live to the full at present and at the sametime assures the safety of the future by giving the flexibility of being paid aspecific percentage of the Sum Assured at particular intervals. But Indiancustomer perception basically this – 1. Easy liquidity of periodic cash flow at the end of the 4th year and thereafter at the end of every 3 years. 2. Savings with Investment Plan 3. Safety for the moneyThe consumer’s perception towards Life Insurance Policies is positive. Itdeveloped a positive mind sets for their investment pattern, in insurance policies.Still some actions are needed for developing insurance market. The major factorsplaying the role in developing consumer’s perception towards Life InsurancePolicies are Consumer Loyalty, Service Quality, Ease of Procedures, SatisfactionLevel, Company Image, and Company-Client Relationship. Insurance industry hasto go ahead. A lot of opportunities are still waiting. This research will help indeveloping the market share, loyalty and further development in insurance sector.
  34. 34. 4.3. Suggestions 1. Insurance companies should try to adopt different strategies to market their products or plan. Companies should not primarily focus on the agents for their business. 2. Insurance company should try to decrease its charge. 3. Agents should not be cheat with his client .they should be give clear information about insurance product.
  35. 35. Project B – 2“Comparison study on Reliance LifeInsurance with other private insurancecompany”
  36. 36. Chapter No. 55.1. AbstractToday total Investment scenario is changing, in past people were not interested ininvestment because there were no good options available for investment. Nowthere are many options available for investment like life Insurance, Mutual fund,Equity market, Real estate, etc. Today people want more services and more returnon their investment. So, most of the insurance companies are providing more value– added services with the basic insurance operation. Another option for investmentavailable is Mutual Fund. Mutual Funds are providing good returns. So whileinvesting people tend more to words mutual fund as they are providing morereturns than Insurance also, with a good investment portfolio. Mutual fundcompanies are providing more liquidity. The project topic was taken to knowabout, compare study of Reliance life Insurance product with other privateinsurance company’s product.
  37. 37. 5.2. Objective • To compare investment option of costumer in ULIPs and Mutual Fund • To understand the reason for which costumer prefer ULIP as one of the best insurance investment rather than mutual fund.5.3. Introduction5.3.1. ULIP Plan of Reliance Life InsuranceULIPs have been the darling of insurance companies, intermediaries andthe insured population alike over the last five years. The main reason for thispopularity is the twin advantage of a pure life cover (insurance component) and arange of investment funds or options (savings component) to match your riskprofile. While the pure life cover provides the much needed financial security toyour dependents in the event of your untimely death, the savings component allowsyou to participate in the capital markets and build wealth over the long-term tenure
  38. 38. of the policy. Unit Linked Insurance Policies (ULIPs) as an investment avenue areclosest to mutual funds in terms of their structure and functioning. As is the caseswith mutual funds, investors in ULIPs are allotted units by the insurance companyand a net asset value (NAV) is declared for the same on a daily basis. SimilarlyULIP investors have the option of investing across various schemes similar to theones found in the mutual funds domain, i.e. diversified equity funds, balancedfunds and debt funds to name a few. Generally speaking, ULIPs can be termed asmutual fund schemes with an insurance component. However it should not beconstrued that barring the insurance element there is nothingChapter No. 066.1. Differentiating mutual funds from ULIPs6.1.2. Mode of investment/ investment amountsMutual fund investors have the option of either making lump sum investments orinvesting usingthe systematic investment plan (SIP) route which entailscommitments over longer timehorizons. The minimum investment amounts arelaid out by the fund house. ULIP investors also have the choice of investing in alump sum (single premium) or using the Conventional route, i.e. making premiumpayments on an annual, half-yearly, quarterly or monthly basis. In ULIPs,determining the premium paid is often the starting point for the investment activity.
  39. 39. This is in stark contrast to conventional insurance plans where the sum assured isthe starting point and premiums to be paid are determined there after ULIPinvestors also have the flexibility to alter the premium amounts during the policystenure. For example an individual with access to surplus funds can enhance thecontribution there by ensuring that his surplus funds are gainfully invested;conversely an individual faced with a liquidity crunch has the option of paying alower amount (the difference being adjusted in the accumulated value of hisULIP). The freedom to modify premium payments at ones Convenience clearlygives ULIP investors an edge over their mutual fund counterparts.6.1.2. ExpensesIn mutual fund investments, expenses charged for various activities like fundmanagement, sales and marketing, administration among others are subject to pre-determined upper limits as prescribed by the Securities and Exchange Board ofIndia. For example equity-oriented funds can charge their investors a maximum of2.5% per annum on a recurring basis for all their expenses; any expense above theprescribed limit is borne by the fund house and not the investors. Similarly fundsalso charge their investors entry and exit loads (in most cases, either is applicable).Entry loads are charged at the timing of making an investment while the exit loadis charged at the time of sale.
  40. 40. Insurance companies have a free hand in levying expenses on their ULIP productswith no upper limits being prescribed by the regulator, i.e. the InsuranceRegulatory and Development Authority. This explains the complex and at timesunwieldy expense structures on ULIP offerings. The only restraint placed is thatinsurers are required to notify the regulator of all the expenses that will be chargedon their ULIP offerings. Expenses can have far-reaching consequences oninvestors since higher expenses translate into lower amounts being invested and asmaller corpus being accumulated.6.1.3. Portfolio disclosureMutual fund houses are required to statutorily declare their portfolios on aquarterly basis, albe it most fund houses do so on a monthly basis. Investors get theopportunity to see where their monies are being invested and how they have beenmanaged by studying the portfolio. There is lack of consensus on whether ULIPsare required to disclose their portfolios. During our interactions with leadinginsurers we came across divergent views on this issue. While one school of thoughtbelieves that disclosing portfolios on a quarterly basis is mandatory, the otherbelieves that there is no legal obligation to do so and that insurers are required todisclose their portfolios only on demand. Some insurance companies do declaretheir portfolios on a monthly/quarterly basis. However the lack of transparency in
  41. 41. ULIP investments could be a cause for concern considering that the amountinvested in insurance policies is essentially meant to provide for contingencies andfor long-term needs like retirement; regular portfolio disclosures on the other handcan enable investors to make timely investment decisions.6.1.4. Flexibility in altering the asset allocationAs was stated earlier, offerings in both the mutual funds segment and ULIPssegment are largely comparable. For example plans that invest their entire corpusin equities (diversified equity funds), a 60:40 allotment in equity and debtinstruments (balanced funds) and those investing only in debt instruments (debtfunds) can be found in both ULIPs and mutual funds. If a mutual fund investor in adiversified equity fund wishes to shift his corpus into a debt from the same fundhouse, he could have to bear an exit load and/or entry load. On the other hand mostinsurance companies permit their ULIP inventors to shift investment across variousplans/asset classes either at a nominal or no cost (usually, a couple of switchesareallowed free of charge every year and a cost has to be borne for additionalswitches) Effectively the ULIP investor is given the option to invest across assetclasses as per his convenience in a cost-effective manner. This can prove to be veryuseful for investors, for example in a bull market when the ULIP investors equity
  42. 42. component has appreciated, he can book profits by simply transferring therequested amount to a debt-oriented plan.6.1.5. Tax benefitsULIP investments qualify for deductions under Section 80C of the Income TaxAct. This holds good, irrespective of the nature of the plan chosen by the investor.On the other hand in the mutual funds domain, only investments in tax-savingfunds (also referred to as equity-linked savings schemes) are eligible for Section80C benefits. Maturity proceeds from ULIPs are tax free. In case of equity-oriented funds (for example diversified equity funds, balanced funds), if theinvestments are held for a period over 12months, the gains are tax free; converselyinvestments sold within a 12-month period attract short-term capital gains tax @10%. Similarly, debt-oriented funds attract a long-term capital gains tax @ 10%,while a short-term capital gain is taxed at the investors marginal tax rate. Despitethe seemingly similar structures evidently both mutual funds and ULIPs have theirunique set of advantages to offer. As always, it is vital for investors to be aware ofthe nuances in both offerings and make informed decisions
  43. 43. Suggestion✔ As insurance sector is growing rapidly so most of the life insurance playersare selling ULIP plans. And the awareness about ULIP is growing most of thepeople knows the ULIP of life insurance. Since last 4-5 years the returns providedby ULIP were very good so people tend more towards ULIP✔ Middle class people who are interested in investment but they are not awareof such options so more awareness should be there, as main target customer are themiddle class peoples.✔ While investing any insurance company customer prefers for good brandedcompany is India’s one of the most famous and richest family. And secondpreference is given to SBI life as many people perceive that SBI Life is a govt.owned company so people want security for their investment.✔ As now till date people in India don’t wanted to invest in share marketbecause then were thinking that it is a bad thing but as the awareness about Mutualfund is increasing as more and more private players are entering in the market. Soawareness about MF is not very good and it can be improved.✔ While survey I found that many all customers had already invested in ULIPand Mutual Fund some people had invested in both options. 12% of people had
  44. 44. invested in Mutual Fund and 26% people had invested in ULIP and 4% people hadinvested in both the options.✔ While investing in mutual fund 44% of the customers looks their return,42%customers observe the scheme’s performance in past years.✔ First reason or preference that why an investor is interested in ULIP isInvestment Purpose, and second is to its returns and after that they investingbecause they are getting the tax benefit. Then again there are some people who areinvesting for pension planning and security.✔ In future people will be more preferring to the security of their money meansthey want a secured option which should provide good returns. As ULIP are theoption in which you can have the security also and good returns. The secondchoice of the investors is return of their money.✔ 54% of people given Best rating to the Reliance Life Insurance ULIP, sofrom this we can analyze that Reliance Life Insurance is doing good but it ishaving good potential in Market. To improve its market share they should improvethe awareness level of the common people.✔ Innovative Products and good brand name are the main success factor forReliance Life Insurance. 6% customers are attracted due to the high reputation of
  45. 45. the company. So if BALIC wants to penetrate its market share they should improvethe marketing strategy, improving the distribution channel etc.Conclusion✔ Awareness of ULIP is increasing as more number of private players isentering in life insurance industry.✔ Mutual Fund is also getting more and more famous in Indian market as manyprivate companies innovating new funds as the investors demand ULIPdifferentiate from Mutual fund in respect of Insurance cover.✔ Investors in Reliance Life ULIP will be getting the advantage of lifeinsurance cover.✔ People are turning towards the ULIP as a good investment option but asULIP is in its starting phase so customers are preferring only big brands.✔ Mutual fund is having good growth but many customers from rural areasdon’t have any knowledge about Mutual fund. They think it is very risky.
  46. 46. ✔ Even investors from cities like Varanasi don’t have that much of Knowledgeabout fund selection they all are depend on Brokers.✔ People in Varanasi are investing in only good branded companies as theydon’t believe on other financial companies for taking ULIP.✔ There is a need for insurers to undertake a demand audit in order tounderstand what the policy holder wants and needs.✔ Deriving the right feedback from customers and bringing out innovativeproducts which cater to customer demands will go a long way in tapping themarket potential of the insurance and Mutual fund sector.✔ For Reliance Life Insurance They should go for creating more awarenessabout its ULIP as now also people are just investing because Reliance is India’smost Known and Favorite brand in past.✔ Reliance life should go for innovating more and more products andimproving the distribution channels as per the area of sales
  47. 47. BibliographyBook- 1. India Today Magazine ( May,2010; Page No. 24 ) 2. Dainik Jagran News paper ( 20th june,2010; Page No.04)Websites 1. www.reliancelife.com 2. www.wikipedia.com 3. www.comparelifeinsurence.co.in 4. www.apnainsurance.com 5. www.moneycontrol.com 6. www.irdaindia.gov 7. www.bajajallianzlife.com 8. www.yahooanswer.com
  48. 48. Annexure –1. QUESTIONNAIRES2. Data Sheet of data collection In Varanasi
  49. 49. QUESTIONNAIRES Declaration: It is purely for academic purposes and the data given will not be passed to anyone. I request you to kindly fill up the form. Thank you.NAME: _____________________________SURNAME____________________DATE OF BIRTH: ___________________PRESENTADDRESS_________________________________________________________________________________________________________________________________________LANDMARK: ______________________PIN ______________PHONE NO _____________ MOBILE____________________PERMANENT ADDRESS:____________________________________________________________________________________________________________________________________EDUCATION: ________________________OCCUPATION: _______________________MONTHLY INCOME:a) <Rs—15,000 b) Rs15000-Rs-30,000 c)> Rs30, 0001. Do you aware with life Insurance? a) Yes b) No2. Are you interested in investing your money?i) Yes ii) No iii) Not now3. Where you want to invest your money? i) Shares ii) Mutual funds iii) Insurance iv) Fixed deposits4. What is your purpose for buying insurance policy?
  50. 50. a) For old age saving b) Family needs c) Time to time needs d) Opposite circumstances 5. In buying insurance policy, your decision is influenced by a) Family b) Friends c) Professional and trade union group d) Brand and Advertisement6. What is your savings as a percentage of annual income? a).15 to 20 b) 20 to 40 c) 40 to 50 d) 50 to 607. How much money you want to invest in insurance? a) 10,000 to 15,000 b) 15,001 to 20,000 c) 20,001 to 25,000 d) 25,001 to 30,000 e) 30,001 to 35,0007. In which company you believe most ? a) Private insurance company b) Public insurance company8. Do you know how many insurance companies prevailing in India? a) 1 b) 8 c) 16 d) More than 20 d) No idea
  51. 51. 9. What will you more attract in insurance?a) Bonusb) Generated Bonusc) Return depend on market10. How do you want to give your premium?a) Cashb) Chequec) Demand Draft11. Do you think that insurance is necessary in today’s life? a) Yes b) No12. In what mode you want to give premium? a. Monthly b. Half-yearly c. Yearly13. Do you want which type of insurance plan? a) ULIP b) Traditional c) Health d) Term Plan
  52. 52. 14. Do you aware with Money Back Policy of any life insurance company ? a) Yes b) No15. How much Money Back policy you have ? a) 0 b) 1 c) 2 d) 3 e) 4 and above16. Do you interested to take Money Back policy ? a) Yes b) No c) Can’t say17. Do you interested to take Money Back policy? a. Yes b. No c. Can’t say18. Are you satisfied with the return on investment, which you are getting from yourpolicy? a. Very satisfied b. Satisfied c. Can’t say d. Not much satisfied e. Dissatisfied
  53. 53. Any Suggestion………………………………………………………………………….Signature: Date: Thank you for Your Cooperation
  54. 54. S. insurance aware with moneyNo. Name Awareness Company plan back Satisfaction Public Insurance Health Not much1 ashsih seth Yes Company Plan Yes satisfied Private Insurance2 sandeep verma Yes Company Traditinol Yes Very satisfied Public Insurance3 shiren saher Yes Company ULIP No Satisfied Public Insurance4 piya rastogi Yes Company Traditinol No Very satisfied Public Insurance5 Aanand tiwari Yes Company Traditinol Yes Satisfied Dr. jitendra Private Insurance Health6 Gupta Yes Company Plan Yes Satisfied Private Insurance7 satish Jiasawal Yes Company Term Plan Yes Cant say ramakant Private Insurance8 jaisawal Yes Company Traditinol Yes Satisfied Private Insurance Health9 sachin dewadi Yes Company Plan Yes Satisfied Private Insurance10 anil gupta Yes Company ULIP Yes Very satisfied Private Insurance11 rehmaan khan Yes Company ULIP Yes Satisfied ramapati Private Insurance12 pradhan Yes Company Traditinol Yes Satisfied Public Insurance13 sanjay gupta Yes Company Traditinol Yes Satisfied Public Insurance14 satish sarma Yes Company Traditinol Yes Satisfied Public Insurance15 rakesh dubey Yes Company Traditinol Yes Satisfied Public Insurance16 deepak kumar Yes Comp Traditinol Yes Satisfied Public Insurance17 wakil ahmed Yes Company Traditinol No Very satisfied Public Insurance18 kanhaiya lal Yes Company Traditinol Yes Satisfied Public Insurance Health19 santosh kumar Yes Company Plan Yes Satisfied gajendra prasad Public Insurance Health20 gupta Yes Company Plan No Satisfied Public Insurance21 rahul sharma Yes Company Traditinol Yes Very satisfied
  55. 55. Public Insurance22 mukta gupta Yes Company Traditinol Yes Satisfied Public Insurance23 dhirendra gupta Yes Company Term Plan Yes Satisfied Public Insurance Health24 ramesh jaisawal Yes Company Plan No Satisfied Private Insurance Health25 Jyotish Prasad Yes Company Plan Yes Satisfied Private Insurance26 Rakesh Prasad Yes Company ULIP Yes Very satisfied Private Insurance27 Gurpreet singh Yes Company ULIP Yes Satisfied Jagdish Private Insurance28 Baranwal Yes Company Traditinol Yes Satisfied Narsinghdas Public Insurance29 gupta Yes Company Traditinol Yes Satisfied Ramakant Public Insurance30 Jaiswal Yes Company Traditinol Yes Satisfied Santosh Kr. Public Insurance31 Jaiswal Yes Company Traditinol Yes Satisfied Public Insurance32 pradeep Jaiswal Yes Company Traditinol Yes SatisfiedS. insurance aware with moneyNo. Name Awarness Company plan back Satisfaction Public Insurance33 Shireen Saher Yes Company Traditinol No Very satisfied Public Insurance34 Amit Jaiswal Yes Company Traditinol Yes Satisfied Public Insurance Health35 Navin gupta Yes Company Plan Yes Satisfied Public Insurance Health36 Pramod Gupta Yes Company Plan No Satisfied Public Insurance37 Naresh Sharma Yes Company Traditinol Yes Very satisfied Public Insurance38 Sunjay singh Yes Company Traditinol Yes Satisfied Koushal Public Insurance39 baranwal Yes Company Term Plan Yes Satisfied Public Insurance Health40 Ravi bhushan Yes Company Plan No Satisfied Public Insurance Health Not much41 aalisha Yes Company Plan Yes satisfied Private Insurance42 Manish Gupta Yes Company Traditinol Yes Very satisfied Public Insurance43 ashish seth Yes Company ULIP No Satisfied
  56. 56. priyesh Public Insurance44 chourasia Yes Company Traditinol No Very satisfied Public Insurance45 pintu shrma Yes Company Traditinol Yes Satisfied Private Insurance Health46 Kailash Gupta Yes Company Plan Yes Satisfied Private Insurance47 Priya rastgi Yes Company Term Plan Yes Cant say Private Insurance Health48 abhishek Gupta Yes Company Plan Yes Satisfied Private Insurance49 prahlad yadav Yes Company ULIP Yes Very satisfied Private Insurance50 Anupam seth Yes Company ULIP Yes Satisfied Ved prakash Private Insurance Health51 gupta Yes Company Plan No Satisfied Private Insurance52 Raju gupta Yes Company Traditinol Yes Very satisfied Public Insurance53 Puttul Gupta Yes Company Traditinol Yes Satisfied Public Insurance54 sunil pandey Yes Company Term Plan Yes Satisfied Public Insurance Health55 lakhan prasad Yes Company Plan No Satisfied Public Insurance Health56 Chanderiwal Yes Company Plan Yes Satisfied Public Insurance57 gita seth Yes Company ULIP Yes Very satisfied Public Insurance58 niki jaiswal Yes Company ULIP Yes Satisfied Public Insurance59 madan galgotia Yes Company Traditinol Yes Satisfied Public Insurance60 aanchal kumari Yes Company Traditinol Yes Satisfied Public Insurance61 Ravi kishan Yes Company Traditinol Yes Satisfied Public Insurance62 lalu yaday Yes Company Traditinol Yes Satisfied Public Insurance63 vivek chourasia Yes Company Traditinol Yes Satisfied Public Insurance64 munna jaiswal Yes Company Traditinol No Very satisfied Private Insurance65 sanjay gupta Yes Company Traditinol Yes Satisfied Private Insurance Health66 deepak jaisal Yes Company Plan Yes Satisfied
  57. 57. Private Insurance Health67 sneha keshari Yes Company Plan No Satisfied Private Insurance68 PK Srivastawa Yes Company Traditinol Yes Very satisfied Public Insurance69 RK Singh Yes Company Traditinol Yes Satisfied Public Insurance70 Ashok Singh Yes Company Term Plan Yes Satisfied Public Insurance Health71 AK tripathi Yes Company Plan No Satisfied Public Insurance72 LC Rai Yes Company Traditinol Yes Satisfied Public Insurance Health73 DK singh Yes Company Plan Yes Satisfied Public Insurance74 JP gaur Yes Company Term Plan Yes Cant say Madholika Public Insurance Health75 Agrawal Yes Company Plan Yes Satisfied Public Insurance76 Hema Singh Yes Company ULIP Yes Very satisfied Public Insurance77 Bharat Rai Yes Company ULIP Yes Satisfied Ram Lakhan Private Insurance78 Gupta Yes Company Traditinol Yes Very satisfied Private Insurance79 S k Sen Gupta Yes Company Traditinol No Satisfied Raj bhushan Private Insurance80 Gupta Yes Company Traditinol Yes Satisfied Private Insurance81 TN Rao Yes Company Traditinol Yes Very satisfied Private Insurance Health82 Baccha Singh Yes Company Plan No Satisfied Mushtaq Private Insurance Health83 Ahamed Yes Company Plan Yes Satisfied Private Insurance84 S D Khatri Yes Company Traditinol Yes Satisfied Private Insurance85 BB Prasad Yes Company Traditinol Yes Satisfied Private Insurance86 R Venketesh Yes Company Term Plan No Very satisfied Ranjanna S Private Insurance Health87 Khanna Yes Company Plan Yes Satisfied Private Insurance Health88 Rajesh Kumar Yes Company Plan Yes Satisfied Ashish Kr. Private Insurance89 Tiwari Yes Company ULIP No Satisfied
  58. 58. Vinod Kr. Private Insurance90 Agrwal Yes Company ULIP No Satisfied Private Insurance91 P K Srivastawa Yes Company Traditinol Yes Satisfied Private Insurance92 S P Mishra Yes Company Traditinol Yes Satisfied Private Insurance93 Ram Bilas Yes Company Traditinol Yes Very satisfied Ravi shanker Private Insurance94 Mishra Yes Company Traditinol Yes Satisfied Public Insurance95 AP Mishra Yes Company Traditinol Yes Satisfied Public Insurance96 HB Srivastava Yes Company Traditinol Yes Satisfied Bandana Public Insurance97 Samant Yes Company Traditinol No Very satisfied Amiya Shanker Public Insurance Health98 Nayak Yes Company Plan Yes Satisfied Public Insurance Health99 Nandlal Jaiswal Yes Company Plan Yes Very satisfied Public Insurance100 Manas Benerjee Yes Company Traditinol Yes Satisfied Public Insurance101 K K gupta Yes Company Traditinol No Satisfied Public Insurance102 Awadh Sharama Yes Company Term Plan Yes Satisfied Public Insurance Health103 SN pandey Yes Company Plan Yes Satisfied Private Insurance104 Neha jaiswal Yes Company Traditinol Yes Satisfied

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