A PROJECT REPORT ON “Organization study & study of problem related to Recruitment, Training & Motivation level of Emloyees” In the partial fulfillment

of the Master of Business Administration Program 2010-2011

Undertaken at

HDFC Standard Life Insurance

ADVENT INSTITUTE OF MANAGEMENT STUDIES UDAIPUR
(Affiliated to Rajasthan Technical University, Kota)

SUPERVISED TO:

SUBMITTED BY:

Dr. Dipin Mathur
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Bharti Tank

MBA lIIrd Semester

CERTIFICATE

TO WHOM SOEVER IT MAY CONCERN

This is to certify that Miss Bharti Tank student of MBA III-sem , Advent institute of management studies , Udaipur has successfully undergone the training on “Organization study & study of problem related to recruitment, training &motivation level of employees” in our organization for the period from 25thJune to 9th Aug,2010. During the tenure of training, we found him sincere and hardworking. We wish him every success for his bright future career.

Manoj Tailor Branch Manager HDFC SLIC Udaipur

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PREFACE
Man has found out himself many things to make himself and his near dear ones happy. Insurance is one such invention of man. Insurance is many splendid things. It is not just the reluctant entry and the periodical reminders for paying the premium and the last receipt of the claim money which may look large or a mere pittance depending upon whether the policy was in force earning handsome bonus or had been languishing in a state of suspended animation. insurance is a wonderful world of mortality rates, utmost good faith, medical examinations with ECG and treadmill exercises, bonuses and no claim discounts and a host of other science and arts which the insurance people learn in order to provide what they call financial security and peace of mind which no other invention of man can match. In this project I try to show the performance of the various funds of the HDFC standard life insurance company limited. In the first chapter of this project I have focus on the introduction, history, needs, importance of the insurance and along with this I also focus on the insurance industry in the India. In the second chapter I have focus on the insurance players in India and types of the plans. In the third chapter of this project I have discuss on the various research methodologies and objectives of this study and the limitation of the study. In the fourth chapter of the project give introduction about the HDFC standard life insurance company limited and it’s vision, mission and value. It focuses on various ULIP plans. In the fifth chapter I have focused that how to design a Unit linked plan and types of the unit linked plans. The sixth chapter is very important because this chapter is the main part of my study in this chapter I have show the performance of the various funds of the HDFC standard life insurance company. what is the current position of the fund in market and what is the current rate of return of the fund all this shows by the various charts and data and the last chapter is related to the conclusion of this project. The following research work takes a look on such persuasion of the insurance companies and the way they deal with people regarding the support of life in old age3

Praveen jha for his insight. me during this and provid ing me an oppo rtunity to lea rn outside the cl ass room It was a truly wonderful . Mr. I wo uld like to dedicate and constant support this project to my pa rents.S Rao and I would also like to thank the supporting staff of ADVENT INSTITUTE OF MANAGEMENT STUDIES. Vinimay commercial complex udaiapole.The Pension Plans. tim and effort e I wish to extend my sincere manager of HDFC SLIC. Dipin Mathur for supporting lea rning exper ience. Panda. His encou ragem ent. all my friends for their help in completion this project opi nions and sug gestions by m in U d a i pur. Vinimay commercial complex udaiapole. e Lastly I would like to thank and the respondents through the survey who off ered their that was conducted Thanking You Bharti tank 4 . I wo uld like to thank my project g uide M r. Without their help this project would not have been possible.Ravi Khabya Head of the department for providing me this opportunity to work on this project. ACKNOWLEDGEMENTS I wo uld like to thank project Dr. I extend my sincere thanks to Director Prof. I would like to thank Mr. Sa les De velopm ent Manager HDFC Standa rd Life Insu rance.K. Udaipur for guiding m through my sum er e m gratitude to the branch resea rch p roject. N. for their help and co-operation throughout my project. B.Udaipur inte rns hip and are greatly app reciated.

Place: Udaipur Date: Signature Bharti Tank 5 . I also declare that this project is originally prepared by me and not been submitted to any University for the award of any degree. Training & Motivation level of Employees” has been carried out by me in partial fulfillment of “Master of Business administration”(MBA) is an own record carried out by me under the supervision of Mr. Project Head. Dipin Mathur.DECLARATION I hereby declare that this project work “Organization study & study of problem related to Recruitment.

EXECUTIVE SUMMARY HDFC Standard Life Insurance is the oldest life insurance company in the world. The company faces competition from all private players in insurance industry but its major competitor is ICICI Prudential Life Insurance Company Limited. With an improvement in the sales techniques used. It is the largest insurer of U. the company is dealing in the marketing of life insurance products and unit linked investment plans. HDFC SLIC has now being started to advertise on different media as its competitors do. But the drawback which I feel is that they are focusing on few of their popular products only.K. To compete with its rival HDFC SLIC have to come up with products at cheaper prices with the same kind of services which they are providing to their esteem customers. Every new recruit is provided with extensive training on unit linked funds and product of HDFC SLIC. On the whole HDFC SLIC is a good place to work at. a fair bit of advertising and modifications to the existing product portfolio. They can try to increase their market share by coming up with the products which are of short term period and with small premium. 6 . Till date Indian customer has a false perception about the insurance – they feel that it would benefit them if they do not live through the policy term. Family responsibilities and high returns are the two main reasons for the people to invest in insurance. Optimum return of 15-20% must be provided to consumers to keep them interested in purchasing insurance. HDFC is set to capture the insurance market in India as it has around the globe. and is 28 th largest company of the world. In India.

CHAPTER 1 :Introduction of insurance Role of insurance Classification of insurance History of life insurance business Needs of life insurance Benefits of life insurance Role of life insurance Law and regulations Insurance industry in India What is human life value What is contract of insurance 8 10 11 12 12 13 15 17 21 25 26 CHAPTER 2 :The insurance player Types of plan 7 28 31 .Content Acknowledgement Declaration Certificate Preface Executive summary Chapter Page No.

CHAPTER 3 :Research methodology Objectives of research Data collection Techniques used in this study Sources of data Objectives of the study Limitation of the study 33 34 34 37 37 38 38 CHAPTER 4 :Organizational profile Why HDFC standard life Vision. mission. values 40 46 47 CHPTER 5 :Product portfolio Introduction to unit linked product Benefits of unit linked plan Design of a unit linked plan Types of unit linked plan 51 54 56 60 63 CHAPTER 6 :Introduction of fund Performance Statistics Individual pension portfolio 80 87 CHAPTER 7 :Conclusion Recommendation Appendix Bibliography 8 .

The losses to assets resulting from natural calamities like fire. It is very important that the trained marketing professionals who are able to communicate specific features of the policy should sell the policy. earthquake. Presently LIC enjoys a monopoly in Life Insurance business while GIC enjoys it in general insurance business. Insurance is rupees 400 billion business in India and yet its spread in the country is relatively thin. Unlike physical assets.INTRODUCTION OF INSURANCE WHAT IS INSURANCE Insurance is basically risk management device. flood. which is dependent on his income in the event of his pre-mature death. However the basic principle is that loss should occur as a result of natural calamities or unexpected events. A successful passage of the IRA bill has clear the way of private sector operators in collaboration with their overseas partners. More over the foreign players would bring sophisticated actuarial techniques with them. The individual also himself also needs financial security for the old age or on his becoming permanently disabled when his income will stop. In the next millennium all these activities would play a crucial role in the overall development 9 . This contribution of many is used to pay the looses suffered by unfortunate few. There has been very little option before the customer to decide the insurer. are met out of the common pool contributed by large number of persons who are exposed to similar risks. This raises his earning capacity and the purpose of life insurance is to protect the income to individual and provide financial security to his family. which would facilitate the insurer to effectively price the product. In that scene human life is a unique income generating assets. the individual become more experienced and mature as he advances in age. accident etc. Insurance as a concept has not being able to make headway in India. It is likely to bring in a more professional and focused approach. which are beyond the human control. Insurance also has an element of saving in certain cases. It is natural to think of insurance of physical assets such as motor car insurance or fire insurance but often be forget that creator all these assets is the human being whose effort have gone along way in building up to assets. which decrease with the passage of time. Secondly insured person should not make any gains out of insurance.

” of misfortune. CHARACTERISTICS OF INSURANCE Sharing of risk Co-operative device Evaluation of risk Payment on happening of special event 10 . GENERAL DEFINITION: In the words of John Magee. the payments being made from the accumulated contributions of all participating in the CONTRACTUAL DEFINITION: In the words of justice Tindall “Insurance is a contract in which a sum of money is paid to the assured as consideration of insurer’s incurring the risk of paying a large sum upon a given contingency. “Insurance may be defined as a social device providing financial compensation for the effects scheme. “Insurance is a plan by which large numbers of people associate themselves and transfers to the shoulders Of all risks that attach to individuals” FUNDAMENTAL DEFINITION: In the words of D S Hansell.and maturity of the insurance industry.

000 corers were directly in government related securities. floods. 000 corers. these vast amounts represent pooling of risks. of which more than rs. therefore. Investment is made out of savings. All good life insurance companies have huge funds. trade and commerce will find it difficult to face the impact of major perils like fire. • As on 31. In effect. accumulated through the payment of small amount of premium of individual.12000crores in hosing loan and Rs. etc.130.2002. more than rs. 11 . These savings are channeled into investment for economic growth. earthquake.4000 corers in water supply and sewerage systems. • A life insurance company will have large funds.the total investment of LIC exceed rs. investment is necessary.3. • The LIC is not an exception.The amount of payment depends on the nature of losses incurred Role of Insurance in Economic Development • For economies development. Every premium represents a risk that is covered by that premium. • Without insurance. These amounts are collected by way of premiums. A life insurance company is a major instrument for the mobilization of savings of people.245. These fund are collected and held in trust for the benefit of the policyholders. These funds are invested in ways that contributed substantially for the economic development of the countries in which they do business. particularly from the middle and lower income groups.

Insurance of property 3. Insurance of interest 4. The granting of super-annuation allowance and annuities payable out of any fund applicable solely to the relief and maintenance of the person engaged or who have been engaged in any particular profession. Life insurance business: It is the business of effecting contracts of insurances upon human life including any contract whereby the payment of money is assured on death or on the happening of any Contingency to the dependent on human life and any contract which is subject to the payment of premiums for a term and shall be deemed to include: The granting disability and double and triple indemnity accident benefits. trade or employment or of the dependents of such persons.Classification of insurance business: The insurance is broadly classified as: 1 . The granting of annuties of human life. Fire insurance 2. Insurance of person 2. Non life business : insurance Conventional classification of insurance business: 1.Life insurance business 2. if so provided in the contract of insurance. Insurance of liability 12 . Non-life insurance business/General Insurance business. Miscellaneous insurance (accident) Modern classification of general insurance 1. Marine insurance 3.

basic intention of life insurance is to provide for one’s family and perhaps others in the event of death. To be a life policy the insured event must be based upon life (or lives) of the people named in the policy NEED OF THE LIFE INSURANCE: The original. including: 1. There may be designs in some countries where bills and death expenses plus catering for after funeral expenses should be included in Policy Premium. such as terminal illness or critical illness. As life insurance became more established. 13 . polices were to provide for short periods of time. life insurance is a contract between the insurer and the policy owner (policyholder) whereby a benefit is paid to the designated Beneficiary (or Beneficiaries) if an insured event occurs which is covered by the policy. the predominant form simply specifies a lump sum to be paid on the insured's demise. covering temporary risk situations. In the United States. such as sea voyages. As with most insurance policies. It was realized what a useful tool it was in a number of situations. Temporary needs/ threats: The original purpose of Life Insurance remains an important element. namely providing for replacement of income on death etc.History of Life Insurance Life insurance or life assurance is a contract between the policy owner and the insurer. Originally. where the insurer agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other event. the policy owner (or policy payer) agrees to pay a stipulated amount called a premium at regular intervals or in lump sums. In return.

Regular Saving: Providing one’s family and oneself. the policy will pay out guaranteed sum assured. the building up of saving while safeguarding it from ravages of inflation. It is superior to traditional saving machine As well as providing a secure vehicle to build up saving etc. In the event ultimately death. as a medium to long term exercise (through a series of regular payment of premiums). One can buy a suitable insurance policy. Retirement: Provision for one’s on later years has become increasingly necessary. 4. Unlike regular saving products are traditionally lump sum investments. such as fixed deposits. of say the main earner in the family. This has become more relevant in recent times as people seek financial independence from their family. 3. Investment: Put simply. it provides piece of mind to the policy holder. which will provide periodical payments in one’s old age. especially in changing culture and social environment. which is likely to be significantly more then the total premiums paid. BENEFITS: 1. the only return would be the amount invested plus any interested accrued. 14 . where the individual makes are one time payment. With more traditional saving vehicles.2.

Tax relief : The policy holder obtains income tax rebates by paying the insurance premium. It can be encased and facilities borrowing: Sum contracts may allow the policy can be surrendered for a cash amount. can be taken for a temporary period to tide over the difficulty. creditors have no right to any mommies by the insurer. where the policy is written under trust.2. until the end of the term of policy. In contrast savings held in a deposit account can be accessed or stop easily. It encourages saving and forces thrift: Once an insurance contract has been entered into. Presence of life insurance policy facilitates credit for personal or commercial loans as it can be offered as collateral security. the insured has an obligation to continue paying premiums. A loan. it becomes compulsory for the insure to save regularly and spend wisely. if policy holder is not in a position to pay the premium. 5. In addition. 15 . In other words. Include Life Insurance premiums and contribution to a recognized PF etc. otherwise the policy will lapse. It provides easy settlement and protection against creditors Once a person appointed for receiving the benefits or a transfer of rights is made (assignment). Under the married woman’s act the money available from the policy forms a kind of trust which creditors can not claim on. a claim under the life insurance contract can be settled easily. against certain policy. The specified form of saving which enjoys a tax rebate u/s 88 of the income tax act. 4. 3.

If you invest Rs. while the rest is used for savings. The sane amount of Rs. You can not compare an insurance product with other investment schemes for simple reason that it offers financial protection from risks. While most people recognize the tax hedging and tax saving potential of life insurance. Insurance products yield more compared to regular investment option as this is besides the added incentives (read bonuses) offered by insurers. before comparing with other scheme. unlike non-products. 5 to 12 lacks. In the unfortunate event of death within the tenure of the policy.in PPF. 10000/. many are not aware of its advantages as an investment option as well as. the family of the deceased will receive the sum assured. Thus insurance is a unique investment avenue that delivers sound returns in addition to protection. (Depending upon the plan. 16 . One can withdraw 50% of the initial deposit only after four years. you must accept that a part of total amount invested in life insurance goes towards providing for the risk cover. you get maturity benefits on survival at the end of the term. the premium you pay for a investment against risk.10000/.ROLE OF LIFE INSURANCE ======================== Role 1: Life Insurance as “investment” Insurance is an attractive option for investment.5% interest over a year. the access to your funds will be limited.can give you an insurance cover of up to approximately Rs.) And this amount can become immediately available to the nominee of the policy holder on death. something that is the missing in non. Infect.10950 at 9. let us compare insurance as an investment options. But in this case. Thus. In life insurance. year money grows to Rs. In other words. age and medical condition of life insure etc. if you take a life insurance policy for 20 years and survive the term the amount investor as premium in the policy will come back to you with added returns.insurance products. Now.

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To provide such protection. The rebate is reducible from tax payable by a individual or Hindu undivided family. This rebate is can be availed up to a maximum of Rs 12000/.tax benefit. an individual is entitled to rebate 20% on the annual premium payable on his/her life and life of his/her children or adult children. you have a wide range of products and services to choose from. insurance is about risk cover and protection – financial protection. Designed to safe guard against losses suffered on account of an unforeseen events. it’s worth buying some extra sleep.Role 2: Life Insurance as “Risk Cover” First and foremost. you buy peace of mind and are prepared to face any financial demand that would hit the family incase of an untimely demise. This means that you get Rs 12000/.in sum assured. Insurance also provides a safeguard in the case of accident or a drop in income after retirement.on payment of yearly premium of Rs 60000/. This rebate is deductible 18 . who act as trustees to the monies. By buying life insurance. An accident or disability can be devastating and an insurance policy can lend timely support to the family in such time. insurance firms collect contributions for many people who face the same risk. of India has offered tax incentives to life insurance products in order to facilitate the flow of funds into productive assets. ROLE 3: Life Insurance as “Tax Planning” Insurance serves as an excellent tax saving mechanism too. Further. With the entry of private sector player in insurance. The Govt. It also comes as a great help when you retire. you can buy anything upward of Rs 100000/. many of these can be further customized to fit individual/group specific needs considering the amount you have to pay now. to be more precise-to help out last once unpredictable losses. U/S 88 of Income Tax Act 1961.a year. A loss claim is paid out of the total premium collected by the insurance companies. in case untoward incident happens during the term in the policy. Insurance provide you with that uniqueness sense of security that no other form of investment provides.

The certificates are valid for 12 month and may be renewed. LAW AND REGULATIONS Insurance act 1938 • The insurance act 1938. and protection of policyholder’s interest. He only procures business through agents but dose not perform administrative functions like a chief agents. • Section 2(5A) defines ‘chief agent’ as a person who. the director of companies or partners of firms. use of funds and patterns of investments. Special agents can work in the life insurance business. prohibition of rebates. The act contains provisions regarding licensing of agents and their remuneration. • Section 42A provides for the registration of chief agents and special agents. which came into effect from 1st July 1938. not being a salaried employee of an insurer. employing or causing to be employing insurance agents on behalf of the insurer. It also has provision placing limits on the expenses of insurer. Certificates to functions as such are to be insured after registration. The provision also stipulated the 19 . • Individuals companies or firm can be appointed as chief agents or special agents. not in a general insurance business. and was amended in 1950 and later in 1999. insurance agents on behalf of the insurer. in consideration of commission (I) perform any administrative and organizing function for the insurer and (ii) procures life insurance business for the insurer by employing or causing to be employed. is the principle enactment related to the business of insurance in India. Section 2(17) defines a ‘special agent’ as one who procures life insurance business.from the tax payable by an individual or a Hindu undivided family. and constitution of insurance association and insurance council and the tariff advisory committee foe general insurance. wanting to become chief agents or special agents must be free of the disqualification specified in connection with agents. maintaining solvency levels. The individuals. in consideration of commission.

number of insurance agents that chief agents may employ directly or through special agents and the minimum business they have to do. Life Insurance Corporation Act. to issue direction.3.gave the L. Renewal of certificate is subject to compliance with these requirements.2002. there are stipulations about the number of agents to be employed by a special agents and the minimum business to be done. Similarly. as the amount of Rs 2000 is very small. Insurance Regulatory and Development Authority Act 1999 20 . • The act vest the IRDA with powers to inspect documents. These amendments were made in pursuance of the government’s policy of economic reforms and 11 insurance companies were registered and had commenced life insurance business till 31. Section 30.I.C as a body corporate consisting of not more than 16 members appointed by the central government. The IRDA has powers to adjudicate on disputes between insurer and intermediaries or between intermediaries and to decide on disputes relating to settlement of claim of amount and exceed Rs 2000. The corporation’s duty was to carry on life insurance business to the best advantage of the community.itional director.C exclusive privilege to transact life insurance business in India.I. No chief agents or special agents were registered till the end of 2001. not may disputes are likely to be referred to the authority under this section. 1956 • This act was the basis for the establishments of the L. one of them being the chairmen. to take over the management of an insurer and to appoint administration. This exclusive privilege ceased as a result of the amendment made in 1999. to appoint add.

in so far as they affect the working of the agents. It replaces the ‘controller of insurance’ to administer the provision of the insurance act. • The complaints to the Ombudsman may relate to (a) partial or total repudiation of claims (b) any dispute regarding premium paid or payable in terms of the policy (c) any disputes on the legal construction of the policy relating to claims (d) delay in 21 . and laying down regulations for the proper conduct of the business and the protection of the interest of policyholders. organization engaged in safety and loss prevention. surveyors. consumer forums. licensing. are reproduced in full at the end of this course. provided for the establishment of the IRDA to protect the interest of holders of insurance policies. research bodies and employees’ association in the insurance sector. to regulate. 1972. Their function is to resolve complaints in respect of disputes between policyholders and complaints in respect of disputes between policyholders and insurers in cost effective. It is advised by an insurance advisory committee consisting of not more than 25 member to represent the interest of commerce. 1938 the life insurance corporation act 1956 and the general insurance business act. the central government has framed rules known as Redressal of public grievances rules.• This act. agents. • The IRDA is a corporate body. • The regulations framed by the IRDA. intermediaries. 1998 whereby Ombudsmen are appointed. OMBUDSMAN • In exercise of the powers conferred by sub-section (1) of section 114 of the insurance act. The governing body of the insurance council appoints ombudsmen. passed in December 1999. efficient and impartial manner. It also sought to amend the insurance act. That includes registration. transport. industry. promote and ensure orderly growth of insurance industry and for matter connected therewith or incidental there to. agriculture.

If the complaints dose not accept the Ombudsman’s recommendation. reflecting the value that the govt. A complaint can be made within one year after the insurer had rejected the representation. It has to make its decision on the basis of document submitted to it. and the society and large place 22 . 00. the award cannot be implemented.issue of any insurance document to customers after receipt of premium. chooses the later method. the Ombudsman shall pass an award an in writing. the insurer had to comply within 15 days and inform the Ombudsman accordingly. Most of the govt. whichever is lower. They have a choice between using compulsion and incentives.settlement of claims (e) non. The subject matter should not be already before any court or consumers’ forum or arbitration. The award has to be passed within 3 month. starting the amount awarded which shall not be in excess of what is necessary to cover the loss suffered by the complaint as a direct consequence of the insured peril or for an amount not exceeding Rs20. Tax relief is guaranteed in the pension plants and is extremely generous. ROLE: Govt. If the complaint accepts this recommendation. keen to reduce the dependency on the state via private pension provisions. • The Ombudsman is expected to make a recommendation with in one month from the date of receipt of complaint. • The Ombudsman shall act as counsel and mediator in matter within its terms of reference. GOVT. • Complaints to the Ombudsman lie only when the insurer had rejected the complaint or no reply was received within one month of the complaint or the reply was not satisfactory.000. the complaint has to intimate his acceptance of the award within one month by a letter of acceptance to the insurer and the insurer has to comply within 15 days and inform the Ombudsman. But lawyers are not permitted to argue the case. If the complaint dose nit intimate acceptance. The complaints and the insurer are allowed to make personal submission. It is not a judicial authority. It has no right to summon witnesses.

Tax treatments of the benefit vary by country and by benefits. 23 .on the provision of retirement benefits. a certain amount of the proceeds can be taken as tax lump sum and reminder as taxable income. In India. In UK. Benefits due on withdrawal from schemes are generally taxed unless they are transferred to another scheme or approved pension plan. the proceeds of gratuity and provident fund are tax free in the hand of the members.

The efficient and quality functioning of the Public Sector Insurance Companies. for General Insurance. in 1823 and Tritons Insurance Company. Although life insurance business has been taking shape for the last 300 years. The untapped potential for mobilizing long-term contractual savings funds for infrastructure. recommended a phased program of liberalization. and called for private sector entry and restructuring of the LIC and GIC. The committee submitted its report in January 1994. Insurance ACT was passed in 1928 but it was subsequently reviewed and comprehensive legislation was enacted in 1938.Insurance industry in india Brief History The insurance sector in India dates back to 1818. Subsequently in 1973. First Life Insurance Company was established in 1818 as Oriental 24 . The nationalization of life insurance business took place in 1956 when 245 Indian and Foreign insurance societies were first merged and then nationalized. it came to India with the arrival of Europeans. EVALUATION OF INSURANCE INDUSTRY IN INDIA: Life Insurance in its modern form is a western concept. It paved the way towards the establishment of life insurance Corporation (LIC) and since then it has enjoyed a monopoly over the life insurance business in India. The Indian insurance industry is as old as it is in other part of the world. 1972 was promulgated. Due to concerns of relatively low spread of insurance in the country. in 1850 were incorporated. The (Congress) government set up Insurance set u an Insurance Reforms committee in April 1993. when Oriental Life Insurance Company like Bombay life Assurance Company. The General Insurance Corporation (GIC) in its present form was incorporated in 1972 and maintains a very strong hold over the non-life insurance business in India. General Insurance business. non-life insurance business was nationalized and the General Insurance Business (Nationalization) ACT.

the total premium income generated by life and general insurance in India is estimated at around a meager 1. Insurance Sector The practice of insurance in the world is quite old infect. life insurance 25 . By enacting the IRDA act 1999.7% Non-life business grew by 3. the Govt of India effectively ended LIC’s monopoly and opened the doors for private Insurance companies.20%.31% in 2004-2005 to 0. as a significant portion of its population is in services and the life expectancy has also increased over the years. All the insurance companies were nationalized in 1956 and brought under one umbrella.Insurance Company. How ever.95% of GDP. India is one of the least insured countries but the potential for further growth is phenomenal.1% against global average of 0.LIFE INSURANCE CORPORATION OF INDIA (LIC) which enjoyed a monopoly of the Life Insurance business until near the end of 2000. Amongst the emerging economies. This was also the year when 1st Insurance act was passed by the British Parliament.34% in 20052006 India's market share in the life insurance business showed a real growth of 11 % thereby out performing the global average of 7. In India insurance spending per capita was among the lowest in the world at $7. The years subsequent to the Swadeshi movement saw the emergence of several insurance companies. The first insurance company insuring Indian Lives at standard rates was BOMBAY MUTUAL LIFE INSURANCE COMPANY which was formed in 1870. The companies that follow mainly catered to Europeans and charged extra premium on Indian Lives.As per the latest estimates. At the end of the year 1955 there were 245 insurance companies. Indian Scenario: Unfortunately the concept of insurance is not popular in our country . However India's share of world insurance market has shown an increase of 10% from 0.6 compared to $7 in the previous year. mainly to provide for widows of Europeans.

which began with the decline of the agrarian society in the western countries in the 19th century. Mismanagement had lead to liquidation of as many as 26 . factories. Need for Association With the rise in the number of Indian life insurance companies occasioned by the growth in the national spirit as a result of the independent movement a need was felt by the companies for an organization to assist them in solving the problems faced by them. as it is known today. The growth of India life insurance business continued to remain restricted till the Swedish movement gathered momentum. The demand naturally gathers mare momentum after independence. The business passed through the period of ups and downs with the political and economic situation in the country. Industrialization with its cities. Growth of life insurance Company in any country will illustrate introduced modern life insurance business didn’t make much headway. It can truly be that life insurance is a product of modern industry. Nationalization Even during days of the freedom struggle there was occasional demand for nationalization of life insurance industry.business. It evolved from the great transformation in life. cash economy and an urban ‘saving’ class set the stage for life insurance as a large – scale national institution. The business started taking its deeper roots only when in the late 19 th century ‘India’ insurance companies appeared on the scenes and started accepting ‘India’ lies freely on the same terms as European lives in India. With a view to meeting this need and also to providing a representative body for expression of a common viewpoint of Indian insurance before the government regarding insurance legislation and Indian life Assurance offices association was established in 1928. The association played companies’ forum for expression of representative views on insurance and taxation legislation and imparting insurance education. is a much later development.

1956. The the act were: Spread of message of life insurance as far and wide as possible reaching out beyond the more advanced urban areas well into hitherto neglected areas.25 life insurance companies in the decade after independence. • • • objectives of nationalization of life insurance industry that emerged out of the discussion and speeches in the parliament in the time passage of Effective mobilization of the people’s Prompt and efficient services to the policyholders. Belonged to the policyholders. This misuse of power. essential that benefits of life insurance were made available to every family in the country and that the business should be conducted with utmost economy by the management acting in a spirit of trusteeship to enable maximization of the people’s saving that could be analyzed through the life insurance into the development programs. realization that the money. One of the objectives of the national plans was to build a pay welfare state. The life insurance industry in India had to be geared up for raising resources for execution national programs. Conducting of the business with the utmost economy and with the full savings. Complete security to policyholders. 27 . Another 25 insurance companies had during the same period so frittered away their resources that their business had to be transferred to other companies. All these cost financial losses and consequent suffering to several policyholders who had entrusted their hard earned saving to the care of the company management. by Parliament. position and privilege by these companies in the private sector was one of the most compelling reasons that influenced the decision of the government of India to nationalize the life insurance industry in 1956. Objectives of nationalization: The decision of the Government of India to nationalize life insurance industry was implemented by the passage of the life insurance Corporation Act. It was therefore.

Development of a dynamic and vigorous organization under a Formulation of scheme of insurance to suit different section of the consistent with safety of capital. community. 28 . management conducted in sprit of Trusteeship.• • • • Investment of funds in such a way as to secure maximum yield Economic premium rates.

and together with banking services adds about 7% to India's Gap. These points will be more cleared with this example:• • • • • • Suppose an individual earns Rs. 96000 yearly at 6% interest. 29 . Hence this is not the exact human life value but only a representation to give the customer a fair idea of how it works.(96000*100/6) Therefore the HLV of the person is Rs. Ps. The annual income provided to his family works out to Rs. 8000/month.How big is the insurance market? Insurance is a Rs. and total investible funds with the LIC are almost 8% of GDP. What (HLV)? is Human Life Value Human life value is:• • Capitalized value of the net earnings Present value of the total income lost to the family in the event death. 1600000. Gross premium collection is about 2% of Gap and has been growing by 15-20% per annum. the family would have to Rs. India also has the highest number of life insurance policies in force in the world.400 billion business in India. Health insurance of any kind is negligible and other forms of non-life insurance are much below international standards. 10000/month. 96000 Now if he were not to earn it for them . Yet more than three-fourths of India's insurable population has no life insurance or pension cover.2000/month Therefore the income provided to his family is Rs.1600000 in a bank so that they get Rs. The personal expense is Rs. Note that we have not taken into account the future income growth of the person.

Although Section 45 of the Insurance Act. The purpose. It is.What is a contract of insurance? A contract of insurance is a contract of utmost good faith. This provision is not applicable if the corporation can prove that misrepresentation or non. those which he thinks material Misrepresentation non-disclosure or fraud in any document leading to the acceptance of the risk automatically discharges the corporation from all liability under the contract. therefore. It is equally obligatory on an agent to see that the assured doesn't obtain the contract by means of untrue representation or concealment in any respect. who is one of the parties to the contract.disclosure was on a material fact and was fraudulently made and that the policyholder knew at the time that statement he made was false. In all the contracts of insurance the proposes is bound to make full disclosure of all material facts and not merely. 1938 provides that no policy can be called in question after a period of two years from the date of its issue on the ground that any statement in proposal or a related document was false or inaccurate (making the policy indisputable). Therefore. in the interest of the would be policyholder to disclose all the material facts to the corporation to avoid any complication when the claim arises. technically known as uberrima fides. It is the duty that the agent owes both to his client and to the corporation. The doctrine of disclosing all material facts is embodied in this important principal that applies to all forms of insurance. 30 . is presumed to have means of knowledge that are not accessible to the corporation who is the other party to the contract. the purpose is bound to tell the insurer everything affecting the judgment of the insurer.

The Insurance Players… – HDFC Standard Life Insurance Company Limited – Birla Sun Life Insurance Company Limited – TATA AIG Life Insurance Company Limited – Max New York Life Insurance Company Limited – Kotak Mahindra Old Mutual Life Insurance Limited – SBI – Cardiff Life Insurance Company Limited – ING Vysya Life Insurance Company Limited – Bajaj Allianz Life Insurance Company Limited – ICICI Prudential Life Insurance Company Limited – MetLife Life Insurance Company Limited – Aviva Life Insurance Company Limited – Reliance Life Insurance Company Limited – Sahara India Life Insurance Limited _ Shriram Life Insurance Company Limited 31 .

03 1.90 0.THE FOLLOWING COMPANIES HAS THE REST OF THE MARKET SHARE OF THE INSURANCE INDUSTRY.26 0.36 1.63 2.51 0.3 5. NAME OF THE PLAYER (%) LIC ICICI PRUDENTIAL BIRLA SUN LIFE BAJA ALLIANZ SBI LIFE HDFC STANDARD TATA AIG MAX NEW YORK AVIVA OM KOTAK MAHINDRA ING VYASA AMP SANMAR METLIFE MARKET SHARE 82.29 0.80 1.37 0.21 32 .79 0.56 2.

S ae o t ei s r n ei d sr h r s f h n ua c n u t y 9 0 8 0 L I C I I I C C PUET L R D NI A B L SN I A U R L E I F 6 0 BJ AA AL N LI Z A S IL E B I F 5 0 HF DC SA D R TNAD TT A AA I G 4 0 MX E A NW YR OK AI A V V 3 0 O K TK M OA MH D A AI R N I G YS N VA A 2 0 AP M SNA A MR MTI E EL F 1 0 7 0 0 1 33 .

At the miss happening and will give the rest premium by its own and will give the bonus at maturity again to the child.5 times So the customer will get approx 5 lakhs after deducting all charges.. As it is said higher risk higher 34 . It is seen that people also invest less in such type of policies as returns are less and there is a compulsion attached is of compulsory premium submission till the policy matures. ULIP ULIP stands for UNIT LINK INSURANCE PLAN. Insurance is always of the parent and beneficiary is the child. because it is not dependent on the market risk and is a rigid policy. Example: Children’s Plan. In this plan the customer has knows how much return he will get after maturity or any miss happening occurs.e. Illustration: Premium for 10 yrs is 20000 20000+20000+20000+20000+20000+20000+20000+20000+20000+20000= 2lks Return described was 2. Conventional ULIP Conventional:- Conventional plans are those plans in which returns are known and are fixed.Types of Plan…. There are 2 types of loss that occurs on any type of miss happening i. Here risk is low and returns are also low. emotional loss and monetary loss company can’t full fill emotional loss but can help in monetary loss by giving the 2lks Rs.

return 35 .

especially through search for new facts in any branch of knowledge. It is necessary for the researcher to know not only the research methods or techniques but also the methodology.RESEARCH METHODOLOGY MEANING OF RESEARCH METHODOLOGY “A Research is a careful investigation or inquiry. Research methodology is a way to systematically solve the research problem.” Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically. Research is an organized enquiry designed and carried out to provide information for solving a problem. It is a systemized effort to gain more knowledge. Researcher always needs to understand the assumptions underline various technique and they need to know the criteria by which they can decide that certain technique and procedures will be applicable to certain problems and other will not. We study the various steps that are generally adopted by a researcher in studying his research problem along with the logic behind them. It may be understood as a science of studying how research is done scientifically. 36 .

the researcher should keep in mind two types of data viz . Research extends knowledge of human beings. 4. brings to light hidden information that might never be discovered fully during the ordinary course of life. While deciding about the method of data collection to be used for the study. Research aims to analyze inter-relationships between variables and to derive causal explanations and thus enables us to have a better understanding of the world in which we live. 37 . 5. social life and environment. 3.primary and secondary. Scientists and researchers search answers for various types of questions: what. Research verifies and tests existing facts and theory and these help improving our knowledge and ability to handle situation and events. how and why. where. Research also aims at developing new tools. when.OBJECTIVES OF RESEARCH 1. concepts and theories for a better study of unknown phenomena. DATA COLLECTION The task of data collection begins after a research problem has been defined. Research unravels the mysteries of nature. 2.

Primary data can be classified into two types: • • Data classified by their nature. Other methods Secondary data are statistics not gathered for the immediate study at hand but for some other purposes. Earlier research done in the company. Schedules 5. Secondary data can be classified into two types: Internal data which include • • • sales analysis.Primary data may be described as those data that have been observed and recorded by the researchers for the first time to their knowledge. Observation method 2. Questionnaires 4. Some of the important ones are: 1. Investor annual report. 38 . Primary data can be collected through several methods. Interview method 3. Data classified according to function.

Text books. Magazines. Published research. Other Source of data collection • • Index. Internet search engines.External data which include • • • • Encyclopedias. 39 .

e. 3 4 5 6 40 . The company publication includes booklets. annual report. tabulation analysis and figure relevant to fund performance of the company. Data published by the CRICIL (Credit Rating company). Analysis of funds of the various plans of the HDFC standard life insurance company. profit & loss account. Secondary data from various mutual funds. templates. Various documents relating to the performance of the fund. books.TECHNIQUES USED IN THIS STUDY 1 2 3 4 Consultation and personal observation. 1 2 The annual financial statements of the concern i. newspapers etc. Getting the various documents on websites. compilation. balance sheet. Collection classification. Broachers etc. SOURCES OF DATA The analysis was based on following document and related Information. Taking the help of the various broachers.

funds of HDFC SLI company. LIMITATION OF THIS STUDY 1. There is general paucity of adequate database. 3. The secondary data are not sufficient for this study. 41 . 3. The study is totally based on secondary data because the primary data relating to this topic is very difficult to get from the general public. 2. company limited under the various plans. company in ULIP plans. 2. 4.OBJECTIVES OF THE STUDY 1. To study the performance of the fund of the HDFC standard life To study the investment structure of HDFC standard life insurance To study the return on the various funds of HDFC standard life insurance To know the awareness of the customer about various plans and their insurance company in various ULIP plans.

c) Transform ideas into viable and creative solutions.A. 2. HDFC also has an international office in Dubai.E. with service associates in Kuwait. e) To grow through diversification by leveraging off the existing client base. HDFC operates through 75 locations throughout the country with its Corporate Headquarters in Mumbai. U. HDFC was incorporated 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. India. b) Maintain its position as the premier housing finance institution in the country. Oman and Qatar. 2000 stood at Rs. d) Provide consistently high returns to shareholders.. 42 . The corporation has had a series of share issues raising its capital to Rs. HDFC was promoted with an initial share capital of Rs. 119 crores. HDFC’s main goals are to: a) Develop close relationships with individual households. The net worth of the corporation as on March 31.096 crores. 10 crores.ORGANIZATIONAL PROFILE HOUSING DEVELOPMENT FINANCE CORPORATION: HDFC was started by Hasmukh Bhai Parekh in1977 with the formation of Malhotra Committee. HDFC has since emerged as the largest residential mortgage finance institution in the country.

is one of India’s leading private life insurance companies. HDFC’s assets base amount to over 15. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd. HDFC is the only company so far to receive this award in the service category. Both the promoters are well known for their ethical dealings and financial strength and are thus committed to being a long-term player in the life insurance industry – all-important factors to consider when choosing your insurer. 73% are sourced from individual and trust depositors.000 of the total deposit. HDFC has won several accolades in the past few years. HDFC has more than 110 offices in India presently. HDFC bank for commercial banking.INTRODUCTION Founded in 1977. Qatar and sultanate of OMAN. which offers a range of individual and group insurance solutions. leading providers of financial services in the United Kingdom. It has a depositor base of over 11 lacks customer and a deposit agents force of over 46.000 crore. for the last 6 year consecutively.promoted companies have emerged to meet the investors and customers needs. HDFC Standard Life Insurance Company Ltd. this award was instituted to award recognition to Indian companies for business excellence and quality achievement.). HDFC Mutual Fund for mutual fund products. Being an institution that is strongly committed to the highest standards of quality and excellence. India’s leading housing finance institution and one of the subsidiaries of Standard Life plc. 43 . HDFC. to be followed very shortly by HDFC Standard Life Insurance Company for the life insurance and pension products. One such award is the “ Ramakrishnan Bajaj National Quality Award “ for the year 1999. HDFC is today the market leader in housing finance in India and has extended financial assistance to more than 15 lacks homes. Its financial strength is reflected in highest safety rating of ‘FAAA’ and ‘MAAA’ awarded by CRISIL and ICRA – two of India’s leading credit rating agency respectively. It has also one international office in Dubai and 3 more services associate in Kuwait. which demonstrates the tremendous confidence that retail investors have in the company.

Standard Life Healthcare expanded in March 2006 with the acquisition of the PMI business of First Assist. is a modern company surviving quite a few changes since selling its first policy in 1825. with the aim of establishing it as an independent investment management business providing services to both the group and third party retail and institutional clients. in 1998 and Standard Life Investments. Standard Life Asia Limited (“SL Asia”). opening offices in other towns and acquiring other similar businesses. its UK mortgage and retail savings banking subsidiary. which had previously been the inhouse investment management unit of the group’s life assurance and pensions business. Healthcare & Investments The group set up Standard Life Bank. Standard Life. Standard Life was reincorporated as a mutual assurance company in 1925. The company expanded in the 19th century from its original Edinburgh premises.STANDARD LIFE: The Standard Life Assurance Company ("Standard Life") was established in 1825 and the first Standard Life Assurance Company Act was passed by Parliament in 1832. which has been in the life insurance business for the past 182 years. was separated into a distinct legal entity in the same year. The group acquired Prime Health Limited (subsequently renamed Standard Life Healthcare) in the United Kingdom in 2000. Banking. was incorporated in 1999 as a joint venture and became a wholly-owned subsidiary of Standard Life in 2002. The group’s joint ventures in India with Housing Development Finance Corporation Limited (“HDFC”) were incorporated in 2000 (in relation to the life assurance and pensions joint venture) and 44 . Standard Life currently has assets exceeding over £70 billion under its management and has the distinction of being accorded "AAA" rating consequently for the past six years by Standard & Poor. Standard Life is Europe's largest mutual life assurance company. Standard Life Asia Limited/Joint ventures The group’s Hong Kong subsidiary. The group’s operations in Hong Kong were established to give the group a presence in the Far East from which it could expand into China.

The group’s joint ventures in India with Housing Development Finance Corporation Limited (“HDFC”) were incorporated in 2000 (in relation to the life assurance and pension’s joint venture) and 2003 (in relation to the investment management joint venture). Demutualization of Standard Life 45 . through which it could sell tax-efficient investment products into the United Kingdom. The group’s operations in Hong Kong were established to give the group a presence in the Far East from which it could expand into China. was incorporated in 1999 as a joint venture and became a wholly-owned subsidiary of Standard Life in 2002. Standard Life Asia Limited (“SL Asia”). Standard Life international Limited . Sales of these products commenced in 2006. Service company Following the group’s strategic review in 2004. The group’s joint venture in China with Tianjin Economic Development Area General Company (“TEDA”) became operational in 2003. The group’s joint venture in China with Tianjin Economic Development Area General Company (“TEDA”) became operational in 2003. legal and human resources services. based in Ireland. SLB and SLH.2003 (in relation to the investment management joint venture).The group also incorporated Standard Life International Limited (“SLIL”) in 2005 for the purposes of providing the group with an offshore vehicle.which employ their staff directly). the group established a service company structure for the provision of central corporate services to the group’s business units. facilities. including IT. STANDARD LIFE ASIA LIMITED/JOINT VENTURES: The group’s Hong Kong subsidiary. Standard Life Employee Services Limited (“SLESL”) supplies a wide range of central services to the rest of the group. This service company structure was created to enable Standard Life to comply with regulatory restrictions on the provision of non-insurance services and to exploit group-wide synergies. and employs staff working in the group’s UK and Irish operations (other than SLI.

46 . 2005 and 2006 at the Money Marketing Awards. Standard Life's voting members voted in favor of the Special Resolution for the demutualization of The Standard Life Assurance Company and the flotation of Standard Life plc on the London Stock Exchange. Their ambition from the beginning was to be the first private company to re-enter the life insurance market in India. pension. and to Standard Life Bank since its inception in 1998. LTD. STANDARD LIFE GROUP: • • • • • • • • The Standard Life group has been looking after the financial needs of customers for over 182 years It currently has a customer base of around 7 million people who rely on the company for their insurance. and is rated by Standard & Poor's as 'strong' with a rating of A+ and as 'good' with a rating of A1 by Moody's Standard Life was awarded the 'Best Pension Provider' in 2004. investment. the Financial Adviser Service INCORPORATION OF HDFC STANDARD LIFE INSURANCE CO. banking and health-care needs Its investment manager currently administers £125 billion in assets It is a leading pensions provider in the UK.: The company was incorporated on 14th August 2000 under the name of HDFC Standard Life Insurance Company Limited. The '5 Star' accolade has also been awarded to Standard Life Investments for the last 10 years.On 31 May 2006. On the 23rd of October 2000. this ambition was realized when HDFC Standard Life was the first life company to be granted a certificate of registration. and It was voted a 5 star life and pension’s provider at Awards for the last 10 years running. Standard Life Bank was awarded the 'Best Flexible Mortgage Lender' at the Mortgage Magazine Awards in 2006.

has given the company new directions and has helped the company achieve the status it currently enjoys. HDFC Standard Life Insurance Company Ltd. 47 . The ambition of HDFC Standard Life is to mirror the success of the parent companies and be the yardstick by which all other insurance companies in India are measured. is one of India’s leading private life insurance companies.6 joint venture to form HDFC Standard Life Insurance Company Limited.4%.). which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.HDFC are the main shareholders in HDFC Standard Life. HDFC Standard Life Insurance Co. Deepak Satwalekar. HDFC Standard Life brings to you a whole range of insurance solutions be it group or individual or NAV services for corporations. Both the promoters are well known for their ethical dealings and financial strength and are thus committed to being a long-term player in the life insurance industry. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.) India and UK based Standard Life Company. Ltd was incorporated on 14th august 2000.4:18. this is the maximum investment allowed under current regulations. India’s leading housing finance institution and one of the subsidiaries of Standard Life plc. Both the joint venture partners being one of the leaders in their respective areas came together in this 81. they can be easily customized as per specific needs. The MD and CEO of HDFC Standard Life Mr.6%. HDFC and Standard Life have a long and close relationship built upon shared values and trust. with 81. Given Standard Life's existing investment in the HDFC Group. leading providers of financial services in the United Kingdom. while Standard Life owns 18.

Indian Bank. 48 . HDFC Bank India Limited. Saraswat Bank and Bajaj Capital.The Banc assurance partners of HDFC Standard Life Insurance Co Ltd are HDFC. Union Bank of India. Bank of Baroda.

f) Income Tax benefits for their insurance products. d) Certified Financial Consultants to advice prospective customers. as their partner in meeting their insurance need: a) Innovative products to meet customer’s needs. i) Good financial track record of both parents – HDFC & Standard Life.Why HDFC standard life There are many reasons why people should choose HDFC Standard Life Insurance Company Ltd. 49 . e) Professional approach in managing customer’s investments. h) Efficient customer service team. k) Professional approach in managing customer’s investments. g) Innovative products to meet customer’s needs. c) Good financial track record of both parents – HDFC & Standard Life. j) Certified Financial Consultants to advice prospective customers. b) Efficient customer service team.

This doe’s not just mean being the largest or the most productive company in the market. . In short. rather it is a combination of several things likeCustomer service of the highest order Value for money or customers Professionalism in carrying out business Innovative products to cater to different needs of different customers Use of technology to improve service standards Increasing market share VALUE INTIGRITY What is it? • • ncy • • Why? • • Integrity is the bedrock on which the company and the expectations of the Integrity establishes the credibility of the person.VISION “The most successful and admired life insurance company. the easiest to deal with. defines the character 50 Honest and Truthful in every action. and set the standards in the industry. MISSION We aim to be the top new life insurance company in the market. offer the best value for money. which means that we are the most trusted company. Transpare Stick to principles irrespective of outcome. Be just and fair to everyone. “The most obvious choice for all”. customers and employees are built.

51 .and empowers one to do justice to the job.

To achieve competitive advantage. a strong foundation for a binding relationship. Customer is the reason for our existence. INNOVATION What is it? • • everyday. Why? • • • • • To exceed customer expectation and maximise customer retention.• • Enables building confidence and trust. Looking at every product and process through fresh eyes Understand his expectations by keeping him as the centre . 52 Building a store house of treasures through experiences. To promote growth and upgrade standards in the industry. CUSTOMER CENTRIC What is it? • • actively • • Why? • • • Reinforce brand loyalty by complete transparency. . achieving transparency and laying Guiding principle for all walks of life. Customer interest always supreme. To foster creativity amongst employees and partners To open a world of new possibilities. Customer is the source of revenue for the company.point Listen Understand customer needs and deliver solutions.

. Know them on a personal front. Establish a valuable relationship with them to create a joyful working Job Genuinely understanding the people we work with. Respect for the time of others. Customers’ goodwill alone can bring more business and more customers. Motivate individual to give his / her best. satisfaction TEAM WORK “One for all and all for one” What is it? • • • • Why? • Together Everyone Achieves More :. understand and arrive at a common objective Co-operate and support across departmental boundaries Identify strengths and weaknesses accordingly allocate responsibility to achieve common objectives. PEOPLE CARE What is it? • • • • • • Why? • • • • People are the most valuable assets of the company. environment . Will contribute to customer retention. Guiding their development through training and support Helping them develop requisite skills to reach their true potential. Create an environment of trust and openness.TEAM 53 Whole team takes the ownership of the deliverables Consult all involved .• • • Ensure that customer chooses our company to do business with.

• • • • It adds joy at work place Team work generates synergy and provides a focussed approach. An idea or activity performed in a group has greater acceptability “One for all and all for one” JOY AND SIMPLICITY 54 .

from starting to work to enjoying your golden years and all the stages in between. we have drawn up the basic life stages and help you analyze various insurance needs accordingly. Each one of these stages may pose a different insurance need/cover for you. In this section. Your insurance need will change as your life does.PRODUCT PORTFOLIO HDFC offers products as per the life stages of the customers and their respective needs. 55 .

 Save for vacation. NEEDS:  Save for Home & Wedding  Tax Planning  Save for Golden Years STAGE 2: JUST MARRIED Marriage brings about a significant change. 56 . New dreams and new opportunities also bring in additional responsibilities. Start saving early. Take advantage of the time and power of compounding to ensure that you build up your dreams. While both of you look forward to a happy and secure life. it is equally important to ensure that eventualities don’t come in the way of shaping your dreams. NEEDS:  Planning for home / securing your home loan liability.LIFE STAGES & NEEDS IN HAT STAGES STAGE 1: YOUNG & SINGLE An important stage where one lays down the foundation of a successful life ahead.

NEEDS – 57 . Think about your golden years even before you have reached them. Ensure your protection umbrella takes into account the future cost of securing your child’s dream. STAGE 3: PROUD PARENTS Once you have children. The key is to think ahead and plan well using your time and money. Save for your first child. Having an early start for retirement planning can make a significant difference to your savings. it is important for you to take time and plan for your life after retirement. your need for life insurance is even more. You need to protect your family from an untoward incident. NEEDS:  Provide for children's education  Safeguarding family against loan liabilities  Savings for post-retirement STAGE 4: PLANNING FOR RETIREMENT While you are busy climbing the ladder of success today. and having enough life insurance is a way to help ensure that. You will want life to go on for your loved ones.

Because this was explained to the client and formed a legal part of the policy.g. Product designers did this by setting out the way that expense and mortality costs would affect the policy. of now investment returns were allocated to the policy. expense and administration charges. it was the real start of unbundling. the other major parts of life insurance policies (mortality and expenses) also became unbundled. As time went on in the 1960s and 1970s. whereby the client was not aware of what portion of the premium covered expenses of benefits. independent and comfortable life style in your retirement years. including explicit reporting of charges taken from. are clearly identified to the client. as well as the benefits themselves. In practice. mortality charge). the details of unbundled policies are quite complicated and whether transparency is achieved from the client’s point of view depends primarily on the clarity of the communication from the insurer and the extent to which the client is 58 . This is aided by an annual report on the status and performance of the policy. nor indeed. most life insurance policies was conventional policies. however. INTRODUCTION What is Unit Linking? TO UNIT LINKED PRODUCTS UNIT-LINKED POLICIES ARE UNBUNDLED Unbundling means the separate identification of the constituent parts of the insurance policy. Unbundled products are also said to be transparent because the client can see the progress of the policy. The first step to unbundling was to identity the investment element separately from the other elements of the product. Provide for regular income post retirement  Immediate Tax benefits  Lead a secure. and benefit charges (e. the policy. Until the 1960s . and investment returns allocated to. Some more years passed before the level of unbundling that HDFC Standard Life see today was achieved. That is the investment element.

59 .interested in such detail.

It is important to recognize that the assets of the funds may not be shares –they may be fixed-interest securities. As a result. A unit-linked policy is one whose underlying investments are identifiable and determine its cash values. The value of the policy is linked to the value of the net assets (assets less liabilities) of the fund. as well as shares. The client normally has a choice of funds having different characteristics to which premiums can be allocated. UNIT-LINKED POLICIES ARE LINKED Linking implies matching. This is the real distinguishing feature of unit linking. property. the assets of a particular fund may consist of a mixture of these asset types. derivative instruments. Capital by reducing new-business strain. The investment risk and reward are therefore transferred from the insurer to the client. the client has a choice of funds in which to invest. money market instruments. Of course.UNIT LINK POLICY MAKE USE OF UNIT LINK FUNDS In the UK. unbundled policies are generally referred to as being unit-linked because the investment element of the policy is housed in funds that are divided into units of equal value. the customer can choose his fund according to his own attitude to risk and desire of investment return. THE UNDERLYING FUNDS THE UNITS At HDFC Standard Life. Indeed. Our unit linked funds have different investment objectives and give the customer the opportunity to be exposed to different types of assets. the policy might offer some investment guarantees but in many 60 .

countries this is now the exception rather than the rule. 61 .

As a result . BENEFITS OF UNIT LINKED PLANS To the client Flexibility of premium. 62 . In HDFC standard life’s unit-linked policies the customer sees the charges being deducted explicitly from their policy in respect to these expenses. Some of these charges are charges deducted from the premium and some are deducted from the fund. the cost of benefits incurred and a profit margin to the company.Our unit linked funds have different investment objectives and give the customer the opportunity to be exposed to different types of assets. sum assured and benefit Transparency Control over investment strategy Control over the degree of investment risk To the insurer Product demanded by the market Retention of existing client and attracting new client Unit-Linked Policies Have Explicit Charges: With all insurance products we allow for the expenses. the customer can choose his fund according to his own attitdew to risk and desire of investment return.

The following table shows how much is used to buy units.50% 99.00% 99.00% 1000000 Above 1000000 Additional single premiums Other Charges Reduced ICR added to the fund. the remainder is invested to buy units.00% 85. Investment Content Charge: This is a premium based charge.00% 97. After deducting this charge from the premiums. 63 .00% 99.00% 80.The charges on a unit linked plan of HDFC Standard Life: The charges under this policy are deducted to provide for the benefits and the administration provided by HDFC standard life charges when taken together. 1st Up to 200000 From 200000 to Regular Premiums 500000 From 500000 to INVESTMENT CONTENT RATE (ICR) & 2nd years 3rd year 73. This percentage is called the investment content Rate. Explanation A reduced percentage of the policy holder’s premium is These charges are intended to cover the marketing distribution (including commission) and some other administrative costs relating to the policy.00% 90.00% 99.00% 99. are among the lowest in the industry and are structured to the give the better returns over the long term.

Every month HDFC SL customers make a charge or providing customer with the death or f critical illness customer with the death or critical illness cover they have selected.Fund Management Charge (FMC) Deducted as a percentage of the customer’s fund on a daily basis. HDFC SL make the charge by canceling units in each of the funds customer have chosen. The amount of charges taken each month depend on customer age. Policy Fee A fixed monetary deduction done from the customer’s fund on a monthly basis.to cover the cost of lie cover critical illness and accidental death depending on the option the customer has chosen. the key to building is low FMC. Risk Charges Deducted from the customer’s fund on a monthly basis. reat maturity values Administration Charges A charge of Rs. In the long term. 6 0 per month is charges to cover regular administration costs. The daily unit price already includes a low fund management charge of 1. These are intended to cover the ongoing costs of managing the investments of the policy.25 % per annum of the fund’s value. This charge is taken to cover the ongoing costs of administration of the policy and for any renewal commissions. 64 . in the proportion customer have chosen.

It give flexibility in o Premium paying g o Withdrawals o Protective elements. Premium alterations include stopping and restarting the regular premium after 3 years. Companies also sometimes use them to discourage excessively frequent switches are premium redirections.Miscellaneous However you may come across other charges. The company will make a charge of 25% of the outstanding premiums due for the remainder of this 3 year period. HDFC SL does not charge for any of these options currently. Here are few examples: Surrender Charges Are applied when a policy is surrendered. which are used by other companies else where in the market. The HDFC SL reserves the right to introduce such charges after approval from the IRDA WHY BUY A UNIT LINKED PLAN A unit – linked plan offers the benefits of market – linked returns. 65 . On cancellation or surrender of the policy before 3 years of regular premiums have been paid. They are used to recover costs and lost profits. The Co. Switch or Redirection Charges These cover the additional administration costs associated with switching investments between funds and redirecting premiums.

66 .

Variations of product design by distribution channels. Versions available – single life. The investment accounting and management system to be used. if any. INVESTMENTS Fund links available and investment objectives of each fund. 67 . endowment. The initial and renewal commission payable rules Capabilities of illustration system to be used. regular. Policy and endorsement wordings. joint life (first death.Permitted policy changes (by the insurer and by the client) Availability of loans and / or partial withdrawals and the rules for administering them Nonforfeiture provisions.Cash processing rules – allocation of cast to policies.g. ADMINISTRATION Business processing rules – new and ongoing business. whole. and business. flexible. late processing rules. Marketing material to be available. Premium options – single.DESIGN OF AN UNIT LINKED PLAN The product specification would include (where relevant): CLASS OF PRODUCT The technical class of product – e. MARKETING AND DISTRIBUTION The distribution channels through which the product is available. Allowable insurance benefit add-ons. Investment guarantees (or lack of investment guarantees) Methods and frequency of unit pricing. pension. Training and qualification standards of anti linked insurance intermediaries. last survivor).

In the event of the policy being surrendered. Allocate money received in the early months of a policy to units that have a higher fund management charge than these purchases by later premiums. ADD-ON BENEFITS CHARGES These are usually calculated using a current cost method (unless the premium for addon benefits is included in the total premium). The types of charge. and only the amount of money required to purchase the units net of the excess fund management charges needs to be allocated to the policy. Any charge over and above 68 . In addition. Allocate only a proportion of each premium to the policy for a period of months.PRICING This means the level and type of charges that the insurer can take under the policy. INITIAL CHARGES Initial charges are intended to cover the marketing. charges are taken for add-on benefits if the premium for such benefits is not included in the total premium payable. which can be levied. are levied at the point of surrender. in excess of the regular charges that would have been levied on these units. are initial charges. but essentially. As such. Some possible way of doing this are: Allocate no money to the policy for a period of months. the future excess fund management charges. and switch or redirection charges. renewal charges. the effect is that less money is actually allocated to the policy than is received from the client for a period of time. surrender charges. whatever method is used. This means that risk premium rate are applied each month the sum at risk under each benefit. fund management charges. the excess fund management charges will be received regardless of whether the policy runs its full term or not. There are many different variations of initial charges. distribution and other new business costs relating to the policy.

the pure risk premium charge will help offset expenses.

CHOOSING A CHARGING STRUCTURE
The pattern of expenses incurred for a life insurance policy will always be high acquisition costs followed by much lower but steadily increasing renewal costs. There will also usually be a high initial commission followed by a much lower renewal commission. Ideally, therefore, the charging structure should match this incidence of expenses with a high initial charge followed by a much lower level of renewal charges. For marketing reasons, this may be unacceptable and the insurer may have to either recoup initial expenses over a period of time by taking charges that (Significantly) exceed there renewal expenses or disguise the high initial charges. It was this latter approach that gave rise to the concept of initial units (units that have a high fund management charge.

The alternative approach of taking higher renewal charges makes the insurer vulnerable to early lapses, particularly if no surrender penalty is applied. Taking charges more evenly can be accomplished in a variety of ways, but the main ones are:

A high bid/offer spread.
An allocation rate of (significantly) less than 100%. This may be increased after a period of years to 100% or more and can be marketed as a loyalty bonus. An investment fee (often expressed as a percentage of the premium)

This is effectively an additional bid/offer spread.

A high fund management fee on all units. This could be reduced after a period of years (for example by allocating bonus units) to bring the fund management charge into line with the market more. These can be used either in isolation or in combination.
69

Types of Unit linked plan

There are many unit linked plan of HDFC standard life insurance company.

1. Unit Linked Young Star Plus II 2. Unit Linked Pension II 3. Unit Linked Endowment II 4. Unit linked enhanced life protection 5. children plan 6. Money back plan 7. Single premium whole of life plan 8. Saving assurance plan But in this project I have discuss only three plans because these three plans have the maximum share in the total business of the HDFC Standard life insurance company limited. These plans are as follows: 1. Unit Linked Young Star Plus II 2. Unit Linked Pension II 3. Unit Linked Endowment II

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1. Unit linked Young Star Plus II
As a parent, your priority is your children’s future and being able to meet their dreams and aspiration. Today, we need more money for providing a good education, establishing a professional career or even a modest wedding because these are expensive. Costs are increasing fast. Just imagine how much we need when our children take these important steps in life when institute like IIM is increasing their fees for education by leaps and bound. This plan ensures us a bright future for your children. It makes your child able to lead a life of respect and dignity with a secured financial future.

Benefits of this plan The HDFC unit linked Young star Plus II gives us: • • • • • • Valuable protection to your child in case you are not around. An outstanding investment opportunity by providing a choice of thoroughly researched and selected investments. Regular loyalty units to boost your fund value every year. Flexible benefit combinations and premium payment options. Flexible additional benefit options such as critical illness cover. Flexible benefit payment preferences- Double and Triple Benefit.

Three steps to own your plan Step1: CHOOSE YOUR REGULAR PREMIUM IN this policy you will continue to pay each year of the policy. You can pay monthly, halfyearly or annually. The minimum regular premium is Rs. 12,000 per year for annual and
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It will pay the Sum Assured to the beneficiary. Any Critical illness cover terminates immediately. Step2: CHOOSE YOUR LEVEL OF PROTECTION we can choose any amount of sum Assured with. it will Double Benefit pay 100% of all the future regular premiums at the original level towards the beneficiary policy as and when due. Our family need not pay any further premiums. Step3: CHOOSE ADITIONAL PLAN BENEFIT It offers a range of valuable protection options to secure the future for whole family.It will pay the sum assured to the beneficiary. Benefit Types Benefit payment Preference Summary of the benefits 1. it will pay 50% of all the future premiums at the original level towards our policy and 50% of the premiums will be paid 72 . Death Benefit Triple 1. 3. the minimum regular premium is Rs 1500 per month. 2. 2.half yearly policies. a minimum of 5 times your chosen annul regular premium and a maximum of 40 times your chosen annul regular premium. Our family need not pay any further premiums. For monthly mode. on an annual basis.

Benefit

to the beneficiary as and when due, on an annual basis. 3. Any critical illness cover terminates immediately. 1. We will pay the sum Assured to the beneficiary. 2. our family need not pay any further premiums. It will

Double Benefit

pay 100% of all the future regular premiums at the original level towards your policy as and when due, on an annual basis. 3. The death benefit cover terminates immediately.

Critical Illness Benefit Triple Benefit

1. it will pay the sum assured to the beneficiary. 2. our family need not pay any further premiums it will pay 50% of all the future premiums at the original level towards your policy as and when due, on an annual basis. 3. The death benefit cover terminates immediately.

Step4: CHOOSE YOUR INVESTMENT FUNDS The most significant part of the Unit Linked Plan is that investor can choose the mode of investment. In this plan the investment risk in your chosen investment portfolio is borne by the investor. This means that the premiums you pay in this plan are subject to investment risks associated with the capital markets. The unit prices of the funds may go up or down, reflecting changes in the capital markets. So to balance investors level of risk and return, making the right investment choice is very important and you are responsible for the choices you make. It has 7 funds that give investor:a) The potential for higher but more variable returns over the term of your policy; or
73

b) The more stable returns with lower long-term potential. Your investment will buy units in any of the following 7 funds designed to meet your risk appetite. Table of funds are given below:Asset Class Money market++ Fund Liquid Fund Stable Managed Fund Secure Managed Fund Defensive Managed Fund Balanced Managed Fund Equity Managed Fund Growth Fund 0-5% 0-5% 0-10% 0-40% 60%-100% 95%-100% Very high Very high 0-5% 0-15% 20-70% 30%-60% High 0-5% 0-15% 50-85% 15%-30% 0-5% 0-20% 75-100% LowModerate Moderate 0-30% Bank Deposit++ Govt. securities Equity Risk & Return Rating

+ &bonds Fund Composition 100% 70-100%

Low Low

+ note on the funds shows will manage the investment in each fund so that the proportion of each Asset class is always with the ranges. + + shows Money market instruments. It include liquid Mutual Funds, commercial papers, commercial bills, treasury bills, government securities having an unexpired maturity up to one year. Bank deposits means deposits issued by any primary dealer or non Banking and banking financial company approved by the reserve by the reserve bank of India or any other public Financial
74

institutions or by Housing Finance Companies approved by the National Housing Bank. The past performance of any of the funds

is not necessarily an indication of future performance. Unit prices can go up and down. No fund offers an assured return. The names of the fund it offer under this plan do not, in any way, indicate the quality of the plan, its future prospects or returns.

ELIGLBILTY The age and term limit for taking out a HDFC unit linked young star plus II are as show below:

TERM PERIOD (Yrs.) AGE AT ENTRY (Yrs.) MAXIMUM AGE BENEFIT OPTION Life option Life and health option Minimum 10 10 Maximum 25 25 Minimum 18 18 Maximum 65 55 AT MATURITY (Yrs.) 75 65

Single Premium top up Allocation: The allocation rate for single premium top up are given below:

PRIMIUM PAID DURING YEAR (Rs.) / PRIMIUM FREQUENCY Single premium top up (s) -Year 1
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ALLOCATION RATE YEARLY 97.50% HALF YEARLY 97.50% MONTHLY 97.50%

Stride into your golden years of retirement with dignity and pride.00% 98. Today we are busy climbing the ladder of success and realizing your dreams.00% 2. Step2: CHOOSE YOUR PREMIUM YOU WISH TO INVEST. The HDFC Unit Linked Pension is an insurance policy that is designed to provide a retirement income for life with the freedom to maximize your investment returns. time is with you. BASED ON YOUR RETIREMENT NEED 76 . It will make you able to continue at the same pace. Benefits of this plan The HDFC unit linked pension gives you • • • • An outstanding investment opportunity by providing a choice of thoroughly researched and selected investments.00% 98. between 50 years and 75 years. Unit Linked Pension II The masses of Unit linked Pension is live a life of dignity and self respect. Today. Just take a moment and think.Single premium top up (s) -Year 2+ 98. It gives a post retirement income for life Flexibility to plan your retirement date and Freedom to invest premiums as per your preference Steps regarding this Plan Step1: CHOOSE YOUR RETIREMENT AGE You can select any age you wish to retire at vesting age.

Your investment will buy units in any of the following 7 funds designed to meet your risk appetite.000 per year.You can choose either a single premium policy or a regular premium policy For a regular premium policy.10. So to balance investor’s level of risk and return.000. or b) The more stable returns with lower long-term potential. The minimum regular premium is Rs. In this plan the investment risk in your chosen investment portfolio is borne by the investor.25. 77 . The unit prices of the funds may go up or down. you continue to pay your chosen premium each year of the policy. You can pay monthly (using standing instructions or ecs Mandate). half yearly or annually. Step3: CHOOSE YOURT INVESTMENT STRATEGY The most significant part of the Unit Linked Plan is that investor can choose the mode of investment. This means that the premiums you pay in this plan are subject to investment risks associated with the capital markets. It has 7 funds that give investor:a) The potential for higher but more variable returns over the term of your policy. making the right investment choice is very important and you are responsible for the choices you make. The minimum premium for a single premium policy is Rs. reflecting changes in the capital markets. quarterly. you may choose to pay a hoc single premium top-up or additional regular premiums depending on the policy type you have chosen and your convenience.

Table of funds are given below:- 78 .

) Minimum 18 Maximum 65 AGE AT VESTING (Yrs.Asset Class Money market++ Fund Liquid Fund Stable Managed Fund Secure Managed Fund Defensive Managed Fund Balanced Managed Fund Equity Managed Fund Growth Fund .) Minimum 10 Maximum 40 AGE AT ENTRY (Yrs.) Minimum 50 Maximum 75 Premium allocation charges 79 . securities Equity Risk & Return Rating + &bonds Fund Composition 100% 70-100% Low Low LowModerate Moderate High Very high Very high The age and term limit for taking out the HDFC unit linked pension II are as below: TERM PERIOD (Yrs. ELIGIBILITY 0-5% 0-5% 0-10% 0-40% 60%-100% 95%-100% 0-5% 0-15% 20-70% 30%-60% 0-5% 0-15% 50-85% 15%-30% 0-5% 0-20% 75-100% 0-30% Bank Deposit++ Govt.

80 .00% 3. The allocations are guaranteed for the entire duration of the policy term.000 to 10.50% 98.00.999 5.99.) / PRIMIUM FREQUENCY Annualized regular premium -Year 1 12. the remainder is invested to buy unit. the investment risk in investment portfolio is borne by the policy holder.000 Annualized regular premium -Year 2 Annualized regular premium -Year 3+ PREMIUM ALLOCATION RATE YEARLY HALF YEARLY MONTHLY 60% 80% 85% 98% 60% 80% 80% 98% 60% 80% 80% 98% Single Premium top up Allocation: The allocation rate for single premium top up are given below: SINGLE PREMIOUM TOP-UP (s) Paid during -Year 1 Paid during -Year 2+ ALLOCATION RATE 97.00. PRIMIUM PAID DURING YEAR (Rs. Unit Linked Endowment II It’s massage is to invest in financial security and self respect for your and your family in this policy. After deducting this charge from your premium.000 to 4.This is the premium based charge.

Step2: CHOOSE YOUR LEVEL OF PROTECTION You can choose any amount of sum Assured with: • A minimum of 5 times your chosen annual regular premium. • • Flexible additional benefit options such as critical illness cover.500 per month. An outstanding investment opportunity by providing a choice of the thoroughly Researched and selected investment. half-yearly or annually. For monthly mode. Flexibility benefits combination and premium payment option. Simple steps for this product Step1: CHOOSE YOUR REGULAR PREMIUM This is the premium you will continue to pay each year of the policy. the minimum regular premium is Rs.1. 81 . You can pay monthly. The minimum regular premium is Rs 12.000 per year for annual and half yearly policies. You may also choose to pay although single premium or additional regular premiums depending on your convenience.Benefits of this product The HDFC unit linked endowment plus II gives • • A valuable protection to your family in case you are not around.

Extra life and health option - Benefit types Summary We will pay the greater of your sum assured (less any Death Benefit withdrawals you have made in the two year before your claim) and your total fund value to your family. we will pay a further Accidental Death Benefit. sum assured to your family. Step3: CHOOSE ADITION PLAN BENEFIT It offer a range of valuable protection options to secure the future for your family Life option Extra Life option Life and health option - Death Benefit death benefit + accidental Death benefit Death benefit + critical illness benefit Death benefit + critical illness benefit + Accidental Death benefit.• A maximum of 40 times your chosen annual regular premium. In addition to the death benefit. 82 . We will pay the greater of your sum assured (less any withdrawals you have made in the two year before your claim) and your total fund value to your family. The policy will terminate. Critical illness benefit The policy will terminate. The policy will terminate.

It has 7 funds that give investor:a) The potential for higher but more variable returns over the term of your policy. In this plan the investment risk in your chosen investment portfolio is borne by the investor. The unit prices of the funds may go up or down. Table of funds are given below:- 83 . So to balance investors level of risk and return. making the right investment choice is very important and you are responsible for the choices you make.Step4: CHOOSE YOUR INVESTMENT FUNDS The most significant part of the Unit Linked Plan is that investor can choose the mode of investment. reflecting changes in the capital markets. or b) The more stable returns with lower long-term potential. This means that the premiums you pay in this plan are subject to investment risks associated with the capital markets. Your investment will buy units in any of the following 7 funds designed to meet your risk appetite.

commercial papers. It include liquid Mutual Funds. treasury bills. Unit prices can go up and down. The 84 . government securities having an unexpired maturity up to one year. Bank deposits means deposits issued by any primary dealer or non Banking and banking financial company approved by the reserve by the reserve bank of India or any other public Financial institutions or by Housing Finance Companies approved by the National Housing Bank. + + shows Money market instruments.Asset Class Money market++ Fund Liquid Fund Stable Managed Fund Secure Managed Fund Defensive Managed Fund Balanced Managed Fund Equity Managed Fund Growth Fund 0-5% 0-5% 0-10% 0-40% 60%-100% 95%-100% 0-5% 0-15% 20-70% 30%-60% 0-5% 0-15% 50-85% 15%-30% 0-5% 0-20% 75-100% 0-30% Bank Deposit++ Govt. securities Equity Risk & Return Rating + &bonds Fund Composition 100% 70-100% Low Low LowModerate Moderate High Very high Very high + note on the funds shows will manage the investment in each fund so that the proportion of each Asset class is always with the ranges. The past performance of any of the funds is not necessarily an indication of future performance. No fund offers an assured return. commercial bills.

ELIGLBILTY The age and term limit for taking out a HDFC unit linked Endowment II are as show below: TERM PERIOD (Yrs. in any way.) AGE AT ENTRY (Yrs.50% 97.00% 85 .50% 98.) MAXIMUM AGE BENEFIT OPTION Life option Extra life option Life and health option Extra life and health option Minimum 10 10 10 10 Maximum 30 30 30 30 Minimum 18 18 18 18 Maximum 65 55 55 55 AT MATURITY (Yrs. indicate the quality of the plan. its future prospects or returns.) 75 70 65 65 Single Premium top up Allocation: The allocation rate for single premium top up are given below: SINGLE PREMIOUM TOP-UP (s) Paid during -Year 1 Paid during -Year 2 Paid during -Year 3+ ALLOCATION RATE 97.names of the fund it offer under this plan do not.

00. The above mentioned tax benefits are subjected to the change in the tax law. you can save up to Rs. Under section 10(10D). 86 . • • Under section 80C. the benefit you receive from this policy are exempt from tax.990 from your tax each year (calculate on the higher tax bracket) as premium up to Rs.000 are allowed at a deduction from your taxable income. 1961. 1. subject to the provision contain therein. 33.Tax benefit (Based on current tax law) You will be eligible for tax benefit under section 80C and section 10(10D) of the income tax.

Balanced managed fund 6. Liquid fund 2. They are as follows:- 1. If the investor want less return but security of investment then there is liquid fund for them. Stable managed fund 3. defensive managed fund are available.INTRODUCTION OF FUNDS All the unit linked plans of HDFC standard life insurance company have the 7 types of fund. This fund is useful and fruitful for all type of investors. if the investor wants high return and accept the high risk factor then there is growth fund is available. some fund provide less return with very less risk. Equity managed fund 7. These fund are different from each other according to their investment paturn. 87 . For the moderate return there are balanced managed fund. These funds are different from each other some fund provide higher return to their investor with a high risk. Growth fund The HDFC standard life insurance provide these 7 funds to their investor. Secure managed fund 4. So the investors have various types of options to invest their fund. Defensive managed fund 5. equity managed fund. and some funds provide moderate return with a moderate rate of risk. Thus the investors have various option for investment their money.

You would already be familiar with these funds: a) Liquid Fund The Liquid fund invests 100% in bank deposits and high quality short-term money market instruments.FUNDS AND INVESTMENTS The fund choices available on our unit linked young Star plan are the same as the funds under the existing unit linked endowment plan. The fund is designed to be cash secure and has a very low level of risk. however unit prices may occasionally go down due to the use of short-term money market instruments. Individual life 88 . investments up to 20% can be allocated to this fund. At inception.

however a small amount of working capital may be invested in cash to facilitate the day.b) Secure Managed Fund The Secure Managed fund invests 100% in Government Securities and Bonds issued by companies or other bodies with a high credit standing.to-day running of the fund. individual pension 89 . This fund has a low level of risk but unit prices may still go up or down.

The remainder will be invested in Government Securities and Bonds issued by companies or other bodies with a high credit standing. In addition. 90 . a small amount of working capital may be invested in cash to facilitate the day-to-day running of the fund. The fund has a moderate level of risk with the opportunity to earn higher returns in the long term from some equity investment. Unit prices may go up or down.C) Defensive Managed Fund 15% to 30% of the Defensive Managed fund will be invested in high quality Indian equities.

91 . In addition a small amount of working capital may be invested in cash to facilitate the day-to-day running of the fund. The remainder will be invested in Government Securities and Bonds issued by companies or there bodies with a high credit standing.d) Balanced Managed Fund 30% to 60% of the Balanced Managed fund will be invested in high quality Indian equities. The fund has a higher level of risk with the opportunity to earn higher returns in the long term from the higher proportion it invests in equities Unit prices may go up or down.

92 .E) Growth Fund The Growth fund invests 100% in high quality Indian equities. The fund has a higher level of risk with the opportunity to earn higher returns in the long term. In addition a small amount of working capital may be invested in cash to facilitate the day-to-day running of the fund.

In addition a small amount of working capital may be invested in cash to facilitate to day-to-day running of the funds. This fund have a low level of risk due to exposure only to short term bond (maximum 2 years). 93 . this fund have no invest in short term money market instruments. The fund has the high level of risk with a greater long term return.F) Stable Manage fund 100% fund of stable manage fund are invested in Government securities & bonds issues by companies and other bodies with a high credit standing. The small bond holding will add diversification and provide a little stability. This fund gives the higher potential return than liquid fund over a long period of time. G) Equity managed fund 60 to 100% of equity managed fund will be invested in high quality Indian equity and remaining of fund is invested in government securities and bonds issues by companies and other bodies with a high credit standing.

using charts.Performance Statistics The long-term worth of any Unit Linked policy comes from # The investment return it gives over time # The effect of the charges over the lifetime of the policy The illustration provide at the point of sale comply with IRDA guidelines and show the effect of charges.they are not showing the unit prices (normally called NAVs) They are the superior way of understanding performance because: # Allow us to compare different funds with different starting NAVs # Allow us to compare Actual performance # Provide us with a more comprehensive summary than traditional charts. This investment return data show that how. For a day where the green column is higher than the red line. HDFC SL has provided a better return than the index over the preceding year. retransmitted or redistributed in any manner for any commercial use. We are illustrating our performance from 01-Jan-05 (1-year after launch: 02-Jan-04) to July. CRISIL © Indices are the sole property of CRISIL Limited (CRISIL). CRISIL Indices shall not be copied. This illustrated shows how our unit-linked funds available to our Retail Pension business have performed so far. 2009. which it considers reliable. HDFC SL has provided a lower return than the index over the preceding year. For a day where the green column is lower than the red line. CRISIL has taken due care and caution in computation of the Indices. based on the data obtained from sources. To let you see both when HDFC SL has make under or over performed the Index we have shown the index returns as a line not a series of columns. in general the various funds are performing. 94 . These charts are showing that actual year-on-year performance of our fund against the year-onyear performance of a comparable market index @ (Source: AMFI).

00% 8.00% 0.00% 5.00% 2. Secure managed fund Secured manage fund 15.00% 6.00% -5.00% 2004-05 2005-06 2006-07 2007-08 2008-09 CRISIL liquid fund 2.00% 10.00% I-sec composit index 2004-05 2005-06 2006-07 2007-08 2008-09 95 . Liquid fund Liquid fund 12.00% 0.INDIVIDUAL-PENSION A look at changes in unit prices over a various period of time 1.00% 4.00% 10.

00% 30.00% 0.00% 0.00% 80.00% 20.00% BSE 100 2004-05 2005-06 2006-07 2007-08 2008-09 96 .00% 10.00% 60.00% 40.00% -20.00% 40.00% CRISIL balanced fund 2004-05 2005-06 2006-07 2007-08 2008-09 4.00% 20.3.00% -20.00% -10. Balanced managed fund Balanced managed fund 50.00% -40. Growth fund Growth fund 100.

00% 10.00% 5.00% 10.5.00% 15. Defensive managed fund Defensive managed fund 20.00% 0.00% -5.00% 0. Equity managed fund Equity managed fund 75% BSE 100 + 25% I-sec composit index 40.00% CRISIL mip blended 2004-05 2005-06 2006-07 2007-08 2008-09 97 .00% 20.00% 30.00% 2004-05 2005-06 2006-07 2007-08 2008-09 6.

This fund always gives the high return to their customer. In this project i tried to focus on the performance of various funds of the HDFC SLI. The performance of the defensive managed fund of the HDFC standard life insurance is always better than the CRISIL mip blended index.CONCLUSION The main objective of all the investor is to earn the higher return on their investment so they always try to invest in those securities and fund which give them higher return with a less risk. The equity fund of HDFC standard life insurance not gives the good return to their investor but it is fair and sufficient. The return on the balanced managed fund is also greater than the CRISIL balanced fund. The performance of the secure managed fund of HDFC standard life insurance is mostly equal to the performance of the I-sec composite index. Both the fund give the good return to their customer. The return of the growth fund of HDFC SLI is greater than the BSE 100. From the various data available for helping in the project compilation I we said that the performance of the various funds of the HDFC Standard life insurance is better than what is prescribed by CRISIL In this project I conclude that the return on the various funds of the HDFC standard life insurance is high than the CRISIL indexed. The performance of the entire fund in the market is good and the investor like to invest in these 98 . The return of this fund was equal for some time to the CRISIL balanced fund. Thus after see all the available data we can said that the all the funds of the HDFC standard life insurance give the higher return to their customer than the other fund. The liquid fund of the HDFC standard life insurance is very high than the CRISIL liquid fund. The performance of this fund is always better than the other fund.

funds. On the above discussion we can said that the performance of those funds may be good in future but is totally depends upon the market condition and fluctuation. 99 .

Company can increase their return through selection of better securities. Company should take the effective portfolio investment decision. shares. They give higher return to their investor but all the investor wants higher and higher return because it’s human nature. bonds. No doubt company provides good return to their investor but if the company selects effective and fruitful portfolio investment plan than company increase their return.RECMONDATION The performance of fund is good. If the company provides better return to their investor than it increases the goodwill and market share of the company and it become a top insurance company. 100 . government securities etc. So HDFC SLI should try to increase their return of various funds.

APPENDIX (This Information is for our internal use only. will not to be disclosed to any other organization / department) Consumer Behavior towards Insurance Name Telephone Occupation Marital Status Single Ø Married Ø Address Age Annual Income (Age of Children if applicable) --------------------------------------------------------------------------------------------------Q. 2 What do you think Insurance Is ? A2. 101 . 1 Any There Insurance Companies. which you are aware of ? Q. Necessity for Protection and security Ø Imposition as an Extra Burden on expenditure Ø A compulsory Tool for Tax Saving Ø Q.3 What are the main considerations that a customer looks at while purchasing an insurance policy.

6 A.A3. name the Co. Q.5 A. What are your financial needs in next 10-20 years. Child Education Ø Marriage House Construction Retirement Needs Ø Q. 7 Are you aware about the Unit Link Plans beings launched by various Insurance Companies.4 Tax Ø Saving Ø Protection Ø Pension Ø Investment Ø What would you see while purchasing an Insurance Policy from a Company ? A4.7.6 Why you want to buy another Insurance ? Tax Benefits Ø Savings Ø Other Ø If saving. Yes Ø No Ø (If yes. Standing and Goodwill of the Company Ø Product range of the Company Ø Advertisement being given by the company Ø Services beings given by the Company Ø Communications and Knowledge of the representative Ø Returns and Bonus declared by the Company Ø Other Ø Please specify _________________________________ Q. A.5 Q. and products) Any other comments : ________________________________________________________________ ________________________________________________________________ ________________________________________________________________ 102 .

hdfcinsurance.N. M.google.(Thank You) BIBLIOGRAPHY WEBSITES www.com www.com www.com and other search engines BROUCHERS HDFC Standard Life Insurance BOOKS Life Insurance of RNIS Collage of Insurance Mishra. Insurance Principal and Practice References Websites 103 ..iiifindia.com www.irdaindia.com www.economictimes.

com/index.hdfcstandardlifeinsurance.http://www.com http://www.iciciprulife.jsp 104 .

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