Insurance is an upcoming sector, in India the year 2000 was a landmark year for life insurance industry, in this year the life insurance industry was liberalized after more than fifty years. Insurance sector was once a monopoly, with LIC as the only company, a public sector enterprise. But nowadays the market opened up and there are many private players competing in the market. There are fifteen private life insurance companies that have entered the industry. After the entry of these private players, the market share of LIC has been considerably reduced. In the last five years the private players is able to expand the market (growing at 30% per annum) and also has improved their market share to 18%. For the past five years private players have launched many innovations in the industry in terms of products, market channels and advertisement of products, agent training and customer services etc.

The various life insurers entered India:1. HDFC Standard Life Insurance Company Ltd. 2. Reliance Life Insurance Co. Ltd. 3. ICICI Prudential Life Insurance Company Ltd. 4. Kotak Mahindra Old Mutual Life Insurance Limited. 5. Birla Sun Life Insurance Company Ltd. 6. Tata AIG Life Insurance Company Ltd. 7. SBI Life Insurance Company Limited. 1

8. ING Vysya Life Insurance Company Private Limited. 9. Met life India Insurance Company Ltd. 10. Royal Sundaram Life Insurance Company Limited. 11. Aviva Life Insurance Co. India Pvt. Ltd. 12. Sahara India Insurance Company Ltd. 13. Shriram Life Insurance Company 14. Life Insurance Corporation of India. 15. Max New York Life Insurance Company Limited. 16. Bharti AXA Life Insurance Company Limited. Through this project I want to study about the life insurance industry and also doing the comparative analysis between two insurance players in this industry. They are, a) Reliance Life Insurance Company Limited b) HDFC Standard Life Insurance Company Limited


The entry of foreign MNC’s and the conductive business environment fostered by the government, it is no wonder that the re-entry of private insurance has marked a second coming for the sector. In just five years, the sector has undergone a makeover, offering more choice, better services, quicker settlement, tighter regulation and greater awareness ‘s the environment become more and more competitive and services and products become alike, creating a differentiation is becoming extremely tough. Thus, this project objectives is as follows  To know where Reliance Life Insurance Company limited & HDFC Standard Life Insurance stands in the market.  Find out the strength and the weakness of their plans.  Making comparative analysis between the products of Reliance life insurance Company limited with other life insurance companies especially HDFC Standard Life Insurance Limited.  To know the preference of the customers for ULIPs over mutual funds.  To know People awareness of charge FMC in both ULIP and Mutual funds  Compare of investment in ULIP plans with Mutual Funds.  To study the investment patterns of the consumer in Financial Products.  To know the customer awareness about ULIPs and Mutual Funds.

Scope of the study:
 This study can be conducted by comparing the performances & products of private insurance players in insurance industry.  The number of respondents to be surveyed can be improved.  This study can be conducted to analyze the market stand of Reliance Life Insurance Company limited and HDFC Standard Life Insurance Company Limited.


Type of Research – Size of sample: Area of research study: Sampling procedure: Exploratory Research 40 respondents East Delhi Convenient sampling

Primary Data: Procedure of data collection: Survey Tools for data collection: Questionnaire Secondary Data: Information Brochures, Web Sites


RELIANCE LIFE INSURNCE COMPANY Ltd. Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance – Anil Dhirubhai Ambani Group. The company acquired 100 per cent shareholding in AMP Sanmar Life Insurance Company in August 2005. Taking over AMP Sanmar Life provided Reliance Life Insurance a readymade infrastructure and a portfolio. AMP Sanmar Life Insurance was a joint venture between AMP, Australia and the Sanmar Group. Headquartered in Chennai, AMP Sanmar had over 90 offices across the country, 9,000 agents, and more than 900 employees. Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the Reliance – Anil Dhirubhai Ambani Group (ADAG). Reliance Life Insurance is another step forward for Reliance Capital Limited to offer need based Life Insurance solutions to individuals and Corporate. Reliance Capital Ltd. is one of India’s leading and fastest growing private sector financial services companies, and ranks among the top 3 private sector financial services and banking companies, in terms of net worth. Reliance Capital Ltd. has interests in asset management, life and general insurance, private equity and proprietary investments, stock broking and other financial services. Whatever your career goal, Reliance Life Insurance is a company big enough for your dreams. We, along with the other businesses of Reliance Capital, enjoy a strong position 5

1992.Group revenues cross 60.Total asset cross 35000cr. becomes largest private sector co. 2001. in India.Group profit 2500cr.First corporate in Asia to issue 50 and 100 yrs bond in US debt market. 2007. 1985. 6 . 2008.Became the 1st company to cross 1 million policy mark in 2 years of operations. 2008-09: A total of more than 2000 branches on anvil in the fiscal year. 1998.000cr. and total assets 50000cr.Birth of reliance first textile mill at Naroda.RELIANCE COMMUNICATIONS crosses 50 million customers.Sales cross 4000cr. And this may be the place where you can have the career you always wanted.6 billion for the fiscal year ending in March 2010. 2005-ADA group formed AMP Sanmar acquired and renamed Reliance Life Insurance Corporation (RLIC) 2006-07: RLIC ranked 6th at 930 cr. 2000. 2003. 2008. 1971-72: Launch of only Vimal brand. RELIANCE LIFE INSURANCE HISTORY 1966. revenues cross 14000cr. largest business group in India.Total asset cross 1000 cr.Crosses 2 million policies.Reliance communications plans announced.000cr. 2009-2010: Profit of US$ 3. 1993.Twin IPOs receive 1 million applications. revenues the financial services category.RLIC became only the 2nd national insurance company to get ISO 9001-2000. 2000. largest mobile service in India.Launch of first IPO for general public start at trend.00. 1977. 2007-08: RLIC jumps to 4th position with 2750cr. Sep 07.Controlling stake in BSES (Reliance Energy).RELIANCE MUTUAL FUNDS becomes 1st Asset Management Company (AMC) to cross 1. 2008. 1997.

P. Sam Ghosh Mr. Sales Manager: Fund manager: Mr.P.P. Manoranjan Sahoo Mr. Pankaj Gera Mr.): Regional Manager (C. Nimit Verma Mr. Bhardawaj Mr. Anil Ambani & Tina Ambani Mr. Malay Ghosh Mr. Madhusudan Kela 7 . Honey Narang Mr.): Sr.): Branch Manager (C. Sanjeev A.HIERARCHY Promoters: Group CEO: CEO: HOS: Zonal head (C.


PRODUCT PROFILE Product Details of Reliance Life Insurance Products:Individual Plans 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Reliance Wealth + Health Plan Reliance Secure Child Plan Reliance Automatic Investment Plan Reliance Money Guarantee Plan Reliance Endowment Plan Reliance Special Endowment Plan Reliance Term Plan Reliance Whole Life Plan Reliance Child Plan Reliance Cash Flow Plan Reliance Market Return Plan Reliance Golden Years Plan Reliance Golden Years Plan Value Reliance Golden Years Plan Plus Reliance Simple Term Plan Reliance Special Term Plan 9 .

d. Fast growing economy. Opportunities: b. d. Diversification of funds. Weakness: a. c. f. c. b. Well Efficient Management. Less coverage in Rural Areas. Technology.17 18 19 20 21 22 23 Reliance Credit Guardian Plan Reliance Connect 2 Life Plan Employee Benefit Plans Group Term Assurance Policy Reliance EDLI Scheme Reliance Group Gratuity Policy Reliance Group Superannuation Policy SWOT ANALYSIS Strengths: a. Saving behavior. Lack of good services. Increasing per –capita income in India. e. e. Lack of awareness about insurance among people. 10 . Strong and popular brand name. b. c. Adaptability to changes. Dedicated Employees. High growth of ULIP industry.

The growth of India life insurance business continued to remain restricted till the Swedish movement gathered momentum. as it is known today. b. Another 25 insurance companies had during the same period so frittered away their resources that their business had to be transferred to other companies. It evolved from the great transformation in life. Arrival of new entrants in the insurance industry. The association played companies’ forum for expression of representative views on insurance and taxation legislation and imparting insurance education. Industrialization with its cities. 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. which began with the decline of the agrarian society in the western countries in the 19th century. All these cost financial losses and consequent suffering to several policyholders who had entrusted their hard earned saving to the care of the 11 . The demand naturally gathers mare momentum after independence. It can truly be that life insurance is a product of modern industry. The business started taking its deeper roots only when in the late 19th century ‘India’ insurance companies appeared on the scenes and started accepting ‘India’ lies freely on the same terms as European lives in India. The business passed through the period of ups and downs with the political and economic situation in the country.Threats: a. is a much later development. Nationalization Even during days of the freedom struggle there was occasional demand for nationalization of life insurance industry. 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. cash economy and an urban ‘saving’ class set the stage for life insurance as a large – scale national institution. Growth of life insurance Company in any country will illustrate introduced modern life insurance business didn’t make much headway. How ever. Cut throat competition within the industry INDUSTRY PROFILE The practice of insurance in the world is quite old infect. Mismanagement had lead to liquidation of as many as 25 life insurance companies in the decade after independence. life insurance business. factories.

• Formulation of scheme of insurance to suit different section of the community. 12 . The objectives of nationalization of life insurance industry that emerged out of the discussion and speeches in the parliament in the time passage of 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. 1956. 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. • Conducting of the business with the utmost economy and with the full realization that the money. 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. Belonged to the policyholders. This misuse of power. • Investment of funds in such a way as to secure maximum yield consistent with safety of capital. • Complete security to management. • Effective mobilization of the people’s savings. One of the objectives of the national plans was to build a pay welfare state. • Prompt and efficient services to the policyholders. by Parliament. The life insurance industry in India had to be geared up for raising resources for execution national programs. 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. • Economic premium rates. • Development of a dynamic and vigorous organization under a management conducted in sprit of Trusteeship. It was therefore.

The (Congress) government set up Insurance set u an Insurance Reforms committee in April 1993. Due to concerns of relatively low spread of insurance in the country. The committee submitted its report in January 1994. India also has the highest number of life insurance policies in force in the world. for General Insurance. 13 .Brief History The insurance sector in India dates back to 1818. The untapped potential for mobilizing long-term contractual savings funds for infrastructure. The efficient and quality functioning of the Public Sector Insurance Companies. non-life insurance business was nationalized and the General Insurance Business (Nationalization) ACT. 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. 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. Gross premium collection is about 2% of Gap and has been growing by 15-20% per annum. 1972 was promulgated.400 billion business in India. recommended a phased program of liberalization. and total investible funds with the LIC are almost 8% of GDP. Health insurance of any kind is negligible and other forms of non-life insurance are much below international standards. Subsequently in 1973. General Insurance business. and together with banking services adds about 7% to India's Gap. Insurance is a Rs. when Oriental Life Insurance Company like Bombay life Assurance Company. in 1823 and Tritons Insurance Company. Insurance ACT was passed in 1928 but it was subsequently reviewed and comprehensive legislation was enacted in 1938. and called for private sector entry and restructuring of the LIC and GIC. in 1850 were incorporated. The nationalization of life insurance business took place in 1956 when 245 Indian and Foreign insurance societies were first merged and then nationalized. Yet more than three-fourths of India's insurable population has no life insurance or pension cover.

and sometimes in stark poverty. but untimely death or disability of the person puts the family in a very difficult situation. Uncertainty of death is inherent in human life. such as. the family is secure. clothing & shelter by bringing income at a regular interval. Insurance substitutes this uncertainty by certainty. food. which gives rise to the necessity for some form of protection against the financial loss arising from death.REVIEW OF LITERATURE The head of the family generally supports the family for their basic needs. So long as he or she lives & the income is received steady. 14 . It is the uncertainty that is risk.

31% in 2004-2005 to 0. • Family income needs.95% of GDP.As per the latest estimates. as a significant portion of its population is in services and the life expectancy has also increased over the years.1% against global average of 0. • Retirement income needs. • Business needs What is Human Life Value (HLV)? Human life value is:• Capitalized value of the net earnings • Present value of the total income lost to the family in the event death. • Cash and income needs of a husband on the death of his wife. • Education needs.6 compared to $7 in the previous year.7% Non-life business grew by 3.2000/month • Therefore the income provided to his family is Rs.CURRENT SCENARIO Unfortunately the concept of insurance is not popular in our country .20%. the family would have to 15 . 8000/month. 10000/month. 96000 • Now if he were not to earn it for them . These points will be more cleared with this example:• Suppose an individual earns Rs. the total premium income generated by life and general insurance in India is estimated at around a meager 1. • Income needs of a widow on the death of her husband. which can be broadly classified as under: • Cash and income needs on an immediately following death. India is one of the least insured countries but the potential for further growth is phenomenal. Amongst the emerging economies. However India's share of world insurance market has shown an increase of 10% from 0. Need for insurance: Modern life insurance caters to multiple needs for insurance. • The personal expense is Rs.34% in 2005-2006 India's market share in the life insurance business showed a real growth of 11 % thereby out performing the global average of 7. • The annual income provided to his family works out to Rs. In India insurance spending per capita was among the lowest in the world at $7.

interest. Note that we have not taken into account the future income growth of the person. In all the contracts of insurance the proposes is bound to make full disclosure of all material facts and not merely. Therefore.disclosure was on a material fact and was fraudulently made and that the policyholder knew at the time that statement he made was false. therefore. It is. the purpose is bound to tell the insurer everything affecting the judgment of the insurer. Ps. 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. Although Section 45 of the Insurance Act. This provision is not applicable if the corporation can prove that misrepresentation or non. is presumed to have means of knowledge that are not accessible to the corporation who is the other party to the contract.Rs. Classification of insurance business: The insurance is broadly classified as: 1 . The doctrine of disclosing all material facts is embodied in this important principal that applies to all forms of insurance. 96000 yearly at 6% (96000*100/6) • Therefore the HLV of the person is Rs. 16. 16 . 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.000. who is one of the parties to the contract. What is a contract of insurance? A contract of insurance is a contract of utmost good faith.1600000 in a bank so that they get Rs. Hence this is not the exact human life value but only a representation to give the customer a fair idea of how it works.Life insurance business 2. It is the duty that the agent owes both to his client and to the corporation. if so provided in the contract of insurance. 00. technically known as uberrima fides. 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. The purpose. Non-life insurance business 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. 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).

to regulate. 17 . Maximize mobilization of people's savings by making insurance linked savings adequately attractive. whose money it holds in trust. Insurance of property 3. Insurance of person 2. Fire insurance 2. without losing sight of the interest of the. Non life insurance business: Conventional classification of insurance business: 1. Insurance of interest 4. keeping in view national priorities and obligations of attractive return.The granting of annuities of human life. Spread Life Insurance much more widely and in particular to the rural areas and to the socially and economically backward classes with a view to reaching all insurable persons in . to promote and ensure orderly growth of the insurance industry and for matters connected therewith for incidental thereto and further to amend. the primary obligation to its policyholders. 1956 and the insurance Act. Involve all people working in the Corporation to the best of their capability in furthering the interests of the insured public by providing efficient service with courtesy. Meet the various life insurance needs of the community that would arise in the changing social and economic environment. the Life Insurance Corporation Act. Act as trustees of the insured public in their individual and collective capacities. trade or employment or of the dependents of such persons. in the investment of funds. Marine insurance 3. Bear in mind. 1999 An act to provide for the establishment of an authority to protect the interests of policyholders. 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.the country and providing them adequate financial cover against death at a reasonable Cost. Insurance of liability ROLE OF INSURANCE REGULATORY AND DEVLOPMENT AUTHORITY (IRDA) ACT. 1938 and General Insurance Business Act 1972. the funds to be deployed to the best advantage of the investors as well as the community as a whole. Conduct business with utmost economy and with the full realization that the moneys belong to: the policyholders. Miscellaneous insurance (accident) Modern classification of general insurance 1. community as a whole.

because it is not dependent on the market risk and is a rigid policy. • • Conventional ULIP Conventional:Conventional plans are those plans in which returns are known and are fixed.. There are 2 types of loss that occurs on any type of miss happening i.Promote amongst all agents and employees of the Corporation a sense of participation.e. emotional loss and monetary loss 18 . The Insurance Players… – – – – – – – – – – – – – – HDFC Standard Life Insurance Company Limited Birla Sun Life Insurance Company Limited RELIANCE LIFE 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 Types of Plan….5 times So the customer will get approx 5 lkhs after deducting all charges. Example: Children’s Plan. In this plan the customer has knows how much return he will get after maturity or any miss happening occurs. 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. Insurance is always of the parent and beneficiary is the child. Here risk is low and returns are also low. pride and job satisfaction through discharge of their duties with ded1cat1on towards achievement of Corporate Objective. Illustration: Premium for 10 yrs is 20000 20000+20000+20000+20000+20000+20000+20000+20000+20000+20000= 2lks Return described was 2.

The value of the unit is determined by the total value of all the investments made by the fund divided by the number of units. administration charges and fund management charges. a large part of the first year 19 . At the miss happening and will give the rest premium by its own and will give the bonus at maturity again to the child. the insurance company credits the premium to a common pool called the ‘life fund. In a ULIP too. In ‘with profits’ policies. but they are structured differently. The policyholder’s share in the fund is represented by the number of units. The surplus in the life fund left after meeting these liabilities is credited to policyholders’ accounts in the form of a bonus. Insurers usually offer three choices — an equity (growth) fund.’ after setting aside funds for the risk premium on life insurance and management expenses. ‘With profits’ policies are called so because investment gains (profits) are distributed to policyholders in the form of a bonus announced every year. INTRODUCTION ULIP ULIP stands for UNIT LINK INSURANCE PLAN. the insurer deducts charges towards life insurance (mortality charges). The rest of the premium is used to invest in a fund that invests money in stocks or can’t full fill emotional loss but can help in monetary loss by giving the 2lks Rs. If the insurance company offers a range of funds. are distinct from the more familiar ‘with profits’ policies sold for decades by the Life Insurance Corporation. Unit-linked insurance plans. the insurer calculates how much has to be paid to settle death and maturity claims. Every year. balanced fund and a fund which invests in bonds. ULIPs. As it is said higher risk higher return. ULIPs also serve the same function of providing insurance protection against death and provision of long-term savings. the insured can direct the company to invest in the fund of his choice. In both ‘with profits’ policies as well as unit-linked policies.

insurers can sell these policies with less capital of their own than what would be required if they sold traditional policies. but he also bears the investment risk. Insurers love ULIPs for several reasons. Most important of all. This eats into his savings. As a result. mutual funds are a better option if you have a five-year horizon. management and administration charges. But in the long-term. An investor in a ULIP knows how much he is paying towards mortality.premium goes towards paying the agents’ commissions. But if you have a horizon of 10 years or more. yes.’ on the other hand. investments can be planned out more evenly. He also knows where the insurance company has invested the money. Traditional ‘with profits’ policies too invest in the market and generate the same returns prevailing in the market. but ensures that the policy will continue to cover his life. a policyholder can ask the insurance company to liquidate units in his account to meet the mortality charges if he is unable to pay any premium instalment. The two strong arguments in favour of unit-linked plans are that — the investor knows exactly what is happening to his money and two. ULIP managers have several advantages over mutual fund managers. Since policyholder premiums come at regular intervals. in objective. The transparency makes the product more competitive. But here the insurance company evens out returns to ensure that policyholders do not lose money in a bad year. Mutual fund managers cannot take a similar long-term view because they have bulk investors who can move money in and out of schemes at short notice. no. Because of the high first-year charges. then ULIPs have an edge. they find it difficult to outperform mutual funds in the first five years. To explain this further a ULIP has high first-year charges towards acquisition (including agents’ commissions). A traditional ‘with profits. is a black box and a policyholder has little knowledge of what is happening. ULIPs are for you. The investor gets exactly the same returns that the fund earns. In structure. For instance. ULIPs also offer flexibility. it allows the investor to choose the assets into which he wants his funds invested. 20 . So if you are willing to bear the investment risks in order to generate a higher return on your retirement funds. In that sense they are safer.

In ULIPs. 3) Accidental Death Benefit (ADB) .In traditional ‘with profits’ policies. FEATURES OF ULIPs a) b) c) d) e) f) g) h) i) j) k) Equity investment Life cover Tax benefit 80(c). Since ULIPs are devised to mobilize savings. they give insurance companies an opportunity to get a large chunk of the asset management business.sum assured after 6 months of intimation. LIMITATIONS OF RIDERS 21 .80(10)(10)d Switches Premium redirection Settlement option Exchange option Partial withdrawal Top-ups Various funds Riders RIDERS 1) Critical Illness Rider (CIR) .sum assured less than or equal to Basic plan.sum assured twice of the 5 times the premium paid. the policyholder bears most of the investment risk. the insurance company bears the investment risk to the extent of the assured amount. 4) Basic Term Plan (BTR) .sum assured twice of the 5 times the premium paid. 2) Total Permanent Disability Rider (TPDR) . which has been traditionally dominated by mutual funds.

RELIANCE SUPER AUTOMATIC INVESTMENT PLAN READY MADE PLAN.1) Rider benefit starts at the completion of 18 years.g. Equities 0 – 100 20 0 – 80 80 What needs to be stressed – the age band of 0-40…this is ideal for someone who wants to build a corpus (e. the better time horizon available for generating the returns. 3) Premiums paid towards all the riders can’t be more than 30% o the premium of basic policy. 2) Sum assured of the riders can’t be more than the sum assured of the basic plan.FUND OPTION Fund Name Asset Category Asset Target Allocation (%) Range (%) 0 – 40 0 Investment Objectives Fund A Money Market High real rate of return in instruments The long term through Debt Securities High exposure to equity Such as gilts. investments Corporate debt excluding Money market instruments. – for his child by the time he reaches the vesting age and needs the money for higher education etc…. High equity exposure would help generate better returns – HIGH RISK HIGH RETURNS Ensures safety of investments as your risk appetite reduces with increasing age  Three prepackaged funds available as per age bands  Fund switch is automatic as you move from one age band to another  With growing age equity exposure is reduced  Flexibility to switch to Tailor Made Plan option 22 .) The earlier one starts.

higher education of children. children’s marriage.g.Fund Name Investment Objectives Asset Category Asset Target Allocation (%) Range (%) 0 Fund B Money Market 0 – 40 instruments Significantly higher Debt Securities returns In the long term. through such as gilts. At this stage in life the person may not like to take high risk. outstanding loans etc. as he has many liabilities and forthcoming expenses (e. High exposure to equity corporate debt 0 – 100 excluding Money investments. Equities 0 . Market instruments.50 50 50 What needs to be stressed – the age band of 41-60…this is ideal for someone who wants to consolidate the investments.) Moderate equity exposure would help generate stable returns – MEDIUM RISK MEDIUM 23 .

as at this stage of life he has to survive on the income from investments– LOW RISK LOW RETURNS Decide your own fund mix with this option  Full flexibility to decide your asset mix depending on your risk appetite  Offers 8 funds  Allocate your premium in all or any one fund in ANY proportion*  Take 100% equity to maximize returns or diversify your basket  52 free switches in a year  Flexibility to switch to Ready Made Plan option 24 .RETURNS Fund Name Investment Objectives Asset Category Money Market instruments Asset Target Allocation (%) Range (%) 0 – 40 0 Fund C Returns that exceed the Debt Securities Rate of inflation in the Such as gilts. Equities 0 . money market instruments.20 80 20 What needs to be stressed – the age band of 61 and above… At this stage in life the person may not like to take any risk with his investments. long term while Corporate debt maintaining moderate 0 – 100 excluding probability of negative Returns in the short term.

Tailor Made Option INITIAL ALLOCATION Equity (25%) Corporate Bond (30%) Gilt (25%) Money Market (20%) NEW ALLOCATION Equity (50%) Gilt (50%) Flexibility to switch between the two plan options 52 times a year 25 .

 This option must be exercised at least 30 days before the receipt of benefit under the policy.Reduced allocation charges in the first year.Flexibility to choose from the wide Fund Options like: Equity Fund Corporate Bond Fund Money Market Fund Gilt Fund Infrastructure Fund Energy Fund Mid Cap Fund Pure Equity Fund  Customers can take benefit under existing plan and use it to purchase specified Unit Linked Plan from Reliance.  The Two Options Exchange from Reliance Automatic Investment Plan into Reliance Money Guarantee Plan 26 .  The Key Advantage .

5% 15% 10% 5% 5% 5% 2% CHARGES APPLICABLE 27 .Exchange into Reliance Automatic Investment Plan from Reliance Money Guarantee Plan Allocation charge Premium grid (Rs.5% 20% 17. 000) Year 1 10 to 20 20 to 25 25 to 50 50 to 150 150 to 1500 1500 to 2500 2500 & above Year 2 Year 3 Year 4 + Top-up Reliance Super Auto Invest Plan 30% 25% 22.

Basic Plan Features a. Return Shield c. Policy Limits b. Premium Modes c. Exchange 3. Sum Assured f. Key Benefits a. Life Cover Benefit d. Maturity benefit e. Surrender Value 2. Capital Guarantee b. Other Benefits 28 .RELIANCE MONEY GUARANTEE PLAN 1.

) 10. Riders c.000 2. Summary Snapshot Basic Plan Age at Entry Age at Maturity Policy Term Minimum 30 days 18 years last birthday 10 years Maximum 55 years last birthday 80 years last birthday 30 years Mode Yearly Half Yearly Quarterly Monthly Top-up Minimum Premium (Rs.500 1. Other Charges 6. Tax Benefits 4.000 5. Charge Structure a.000 2. Unmatched Flexibility a. Fund Options b. Premium Payment Option 5.500 MATURITY BENEFIT 29 . Top Up b. Switching d. Partial Withdrawal c.a. Premium Redirection e. Allocation Charges b. Settlement Option f.

On surrender of Basic Plan.Amount of Top-up premiums paid FULL SURRENDER VALUE UNDER BASIC PLAN   You may surrender your policy at any time after three years from commencement. Higher of . under Top-Up or . Plus  Higher of . Year of surrender of Basic Plan 1 to 3 4 5 6 onwards Surrender Charge as a percentage of fund value Not allowed 5% 3% Nil   Return Shield Option – An Innovative Way to Protect Your Returns What is the Return Shield Option?  Returns earned on basic plan and Top-Ups during a policy month are transferred to a Fund called Return Shield Fund at the end of each policy month. under Basic Plan or . any attached top-ups will also be surrendered.Fund Value as on the date of maturity. This fund invests in low risk debt instruments providing steady investment returns.  It can be selected or deleted at any time. The surrender value will be the Fund Value including Return Shield Fund (if selected as on the date of intimation of surrender under basic plan) less surrender charge. 30 .Premiums paid under Base Plan up the date of maturity excluding any extra or additional premiums. No partial surrender value is available under Basic plan.Fund Value as on the date of maturity.  This option is available during the term of the policy.

What are the charges for using this option?  No charge if: • The option is selected under basic plan on commencement of the plan • The option is selected under top-up premium at the time of payment of top-up premium  Under all other circumstances. Profile The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector. a fixed charge of Rs.  This charge will be collected at the time of transaction by canceling the units at prevailing unit price. as part of the RBI's liberalization of the Indian Banking 31 .100 is payable every time the option is selected.

9 crore (Rs. History: HDFC Standard Life Insurance Co.1 billion). The HDFC Group holds 22. The paid-up capital is Rs.3. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.5 billion).6 joint venture to form HDFC Standard Life Insurance Company Limited. expense administration charges and benefit charges shown separately.4:18. 32 . The shares are listed on.4% of the equity is held by the ADS Depository (in respect of the bank's American Depository Shares (ADS) Issue).Industry in 1994. The Stock Exchange. Bank of Baroda. HDFC Standard Life brings to you a whole range of insurance solutions be it group or individual or NAV services for corporations. Indian Bank. The Bancassurance partners of HDFC Standard Life Insurance Co Ltd are HDFC. with its registered office in Mumbai. HDFC Bank India Limited. India.311. Union Bank of India.) India and UK based Standard Life Company. has given the company new directions and has helped the company achieve the status it currently enjoys. HDFC Standard Life Insurance Co.4.450 crore (Rs. Saraswat Bank and Bajaj Capital. Both the joint venture partners being one of the leaders in their respective areas came together in this 81. Capital Structure The authorized capital of HDFC Bank is Rs. Ltd was incorporated on 14th august 2000. Mumbai and the National Stock Exchange. they can be easily customized as per specific needs. Roughly 31. Deepak Satwalekar. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited'. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.000 shareholders. The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol "HDB". Concept of Unit Linked…… Unit Linked Policies are unbundled Unit link polices are separate identification of part investment element.1% of the bank's equity and about 19.3% of the equity is held by Foreign Institutional Investors (FIIs) and the bank has about 190. The MD and CEO of HDFC Standard Life Mr.

33 . Charges can be subjected to be changed however mortality remains unchanged during the tenure of policy. HDSFC SL Unit Link Young Star Plus II provides a medium through a parent can help there children in building up a secured financial future. quarterly or half yearly? Step 2: sum assured minimum 5 times and maximum 40 times. In case of unfortunate demises during the policy term Double Benefit Company will pay 100% of the entire future regular premiums. And sum assured will be given to the beneficiary Triple Benefit Company will give 50%of the premium to the beneficiary and 50% as regular premium. Unit Linked Policies have explicit charges It is the consequence of unbundling. Which can be paid yearly. providing a good education. priority is children’s future and being able to meet their dreams and aspiration.Unit Linked Policies make use of Unit linked funds Investment housed in funds divided in units’ client has choice of funds. And the sum assured will be given to the beneficiary. Surrender In the first five years. establishing a professional career or even a modest wedding is expensive. monthly. Step 3: can choose double or triple benefit. Just imagine how much you will need when your children take these important steps in life. Steps to own a plan Step 1: this is the premium which will continue to pay each year oh the policy. The min regular premium is Rs. ULIP of HDFC • • ULIP with insurance ULIP as pure investment ULIP with insurance Unit link young star plus II As a parent. Today.12000 per year. Unit Linked Policies are linked Value of policy linked to net assets investment risk and rewards transferred from the insurer to the client. Costs are increasing fast.

In the event of unfortunate demises during the policy term. Policy administration charge: 60rs per month All charges other than allocation are being charged on daily basis on the cancellation of units. Charges Fund management charge (FMC) HDFC SL enjoys the lowest FMC rates across the industry i. he /she will revive the accumulated value of the fund.e. you can save up to 33. Tax benefits (based on current tax-law) You will be eligible for tax benefits under section 80ccc of the income tax act. Steps to own plan 34 . there is no surrender charge after 5years. nominee will receive a cash lump sum to help him or her manage the retirement years. 00.25% of fund value.(calculated on the highest tax bracket) as premium up to a maximum of Rs. which will provide pension income. Under Section 80ccc. Allocation charge 1st year 60% 2nd year and onward 1% Allocation how ever increases with increase in premium size thus giving better returns to HNI (high network individual). At the end of the policy term. 1. after 5 years surrender value will be the value of units of the plan. The above –mentioned tax benefits are subject to change in tax law.Surrender is not possible.000 are allowed as a deduction from your taxable income. All insurance plans are subjected to different risk factors. 1.990 from the tax every year. ULIP as pure investment To maximize investment returns. HDFC invest the premium of the customer in the chosen fund in the proportion that he/she specifies. 1961.

nominee will receive the unit fund value. he will get the value of units in policy as per prevailing Govt. • He/She can but the annuity from the company or any other insurer. Surrender is not possible. Allocation charge 1st year 25% 2nd year 25% 3rd and onward 1% 35 . c) On surrender In the first three years. regulations • He/She can take 1/3 if the funds value as a tax-free cash lump sum and rest must be converted to an annuity. quarterly or half yearly? Investor can opt for combination of 6 funds or 1 fund depending upon the need of investor and his ability to take risk. policy will terminate there after.8% of fund value. The min regular premium is Rs.10000 per year.e. Charges Fund management charge (FMC) HDFC SL enjoys the lowest FMC rates across the industry i. . after 3 years surrender value will be the value of units of the plan. • Customer is allowed to alter vesting date subject to above age at vesting and policy term limits. monthly. Step 2: this is the premium which will continue to pay each year oh the policy. Accessing Customers Money: a) On vesting Policy matures at the end of the policy term customer have chosen and on chosen retirement date. b) On death In case of unfortunate demises before the end of policy term. Which can be paid yearly.Step 1 Step 2 Choose the retirement age Choose the premium wish to invest based on retirement needs Step 3 Choose the investment fund or funds he/she desire Step 1: select any age between 50 years and 75 years. there is no surrender charge after 3 years.

e.8% Fmc HDFC 400 400 400 400 400 400 400 400 400 400 400 36 . Under Section 80ccc. The above –mentioned tax benefits are subject to change in tax law. 1961. 00. 0. Tax benefits (based on current tax-law) You will be eligible for tax benefits under section 80ccc of the income tax act. Foe illustration:at 2% Fmc Years 1 2 3 4 5 6 7 8 9 10 11 premiu m 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 others 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 At 0.000 are allowed as a deduction from your taxable income.Allocation how ever increases with increase in premium size thus giving better returns to HNI (high network individual). It seems to be very small charge but in reality it’s a charge which makes the difference between 2 policies. Generally people are unaware if this charge.a. FMC a small but handy tool FMC stands for Fund Management Charges.8% which is generally higher with other companies near about 2%. The maximum FMC in any fund is 2% p. you can save up to 33.(calculated on the highest tax bracket) as premium up to a maximum of rs. HDFC is the company which charges lowest FMC i.990 from the tax every year. Policy administration charge: 20rs per month All charges other than allocation are being charged on daily basis on the cancellation of units. The effect of FMC can be seen in long term but has a minute effect in short term. subject pot prior approval by the IRDA. This is the tool which is vibrantly used by the company to take charges. FMC is applied on the fund while calculating NAV. 1.

it is also the most glamorous – in that it is a young industry where there are changes in the rules of the game everyday. and there are constant shifts and upheavals. a large part of which comes from retail investors.000 crore of assets. Though it is perhaps the smallest segment of the industry.12 13 14 15 50000 50000 50000 50000 6000 15000 9000 1000 1000 1000 1000 400 400 400 400 Sum of HDFC FMC Sum of others FMC Difference INTRODUCTION TO MUTUAL FUND The mutual fund industry is a lot like the film star of the finance business. Today. The money thus collected is invested by the fund manager in different types of securities depending upon the objective of the 37 . the mutual fund industry in the country manages around Rs 100. The one investment vehicle that has truly come of age in India in the past decade is mutual funds. A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal.

skills. Now if you think that the world of Mutual Funds is intimidating. It appoints professionally qualified and experienced staff that manages each of these functions on a full time basis. inclination and time to keep track of events. and. The income earned through these investments and the capital appreciations realized by the scheme are shared by its unit holders in proportion to the number of units owned by them (pro rata). An individual also finds it difficult to keep track of ownership of his assets. These could range from shares to debentures to money market instruments. A mutual fund is the answer to all these situations. the downside of diversification is that a fund can hold so many stocks that a tremendously great performance by a stock will make very little difference to a fund's overall performance. Markets for equity shares. bonds and other fixed income instruments. more importantly. the mutual fund vehicle exploits economies of scale in all three areas research. Mutual Funds – Concept A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. Price changes in these assets are driven by global events occurring in faraway places. In effect. derivatives and other assets have become mature and information driven. debentures and other securities. understand their implications and act speedily. The income earned 38 . A typical individual is unlikely to have the knowledge. you have no control on the investments of the fund. investments and transaction processing. The large pool of money collected in the fund allows it to hire such staff at a very low cost to each investor. real estate. investments. The money thus collected is then invested in capital market instruments such as shares. With mutual funds. brokerage dues and bank transactions etc.scheme. But every coin has a flip side. A mutual fund is the ideal investment vehicle for today’s complex and modern financial scenario. complicated and definitely not for you then think once again. Each Mutual Fund scheme has a defined investment objective and strategy.

The flow chart below describes broadly the working of a mutual fund: Mutual Fund Operation Flow Chart Fig –1 Net asset value (NAV) of a scheme Net asset value denotes the performance of a particular scheme of a mutual fund. NAV is the market value of the securities held by the scheme. 39 . NAV of a scheme also varies on a day-to-day basis. professionally managed basket of securities at a relatively low cost. Since market value of securities changes every day. In simple terms. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified. Mutual funds invest the money collected from the investors in securities markets. The NAV per unit is the market value of securities of a scheme divided by the total number of units of the scheme on any particular date.through these investments and the capital appreciations realized are shared by its unit holders in proportion to the number of units owned by them.

Diversify across fund houses 6. Read the offer document carefully 4. 1.depending on the type of scheme. The intelligent investor's seven rules It’s one thing to understand mutual funds and their working. Identify your investment horizon 3. Do not chase incentives 7. Go through the fund fact sheet 5. Here are seven must-dos that go a long way in helping you meet your investment objectives. Know your risk profile 2.daily or weekly . Track your investments Types of Mutual Fund 40 . if the market value of securities of a mutual fund scheme is Rs 200 lakhs and the mutual fund has issued 10 lakh units of Rs 10 each to the investors. NAV is required to be disclosed by the mutual funds on a regular basis . then the NAV per unit of the fund is Rs 20.For example. it’s another to ride on this potent investment vehicle to create wealth in tune with your risk profile and investment needs.

Investors can conveniently buy and sell units at Net Asset Value ("NAV") related prices. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where they are listed. The fund is open for subscription only during a specified period. c) Interval Funds 41 . These do not have a fixed maturity.Fig –2 Mutual fund schemes may be classified on the basis of its structure and its investment objective:- 1. by Structure: a) Open-ended Funds An open-end fund is one that is available for subscription all through the year. b) Closed-ended Funds A closed-end fund has a stipulated maturity period which generally ranging from 3 to 15 years. The key feature of open-end schemes is liquidity.

by Investment Objective: a) Equity Oriented Schemes These schemes. However. Fig – 3 Fig –4 b) Debt Based Schemes 42 . these schemes are exposed to fluctuations in value especially in the short term. They are open for sale or redemption during pre-determined intervals at NAV related prices. Such schemes have the potential to deliver superior returns over the long term. seek to invest a majority of their funds in equities and a small portion in money market instruments.Interval funds combine the features of open-ended and close-ended schemes. also commonly called Growth Schemes. 2. because they invest in equities.

as compared to the money market schemes they do have a higher price fluctuation risk and compared to a Gilt fund they have a higher credit risk.These schemes. However. The prices of these schemes tend to be more stable compared with equity schemes and most of the returns to the investors are generated through dividends or steady capital appreciation. invest in debt securities such as corporate bonds. such as retired individuals. also commonly called Income Schemes. Fig – 5 Fig –6 c) Hybrid Schemes 43 . debentures and government securities. These schemes are ideal for conservative investors or those not in a position to take higher equity risks.

These schemes are commonly known as balanced schemes. each time you buy or sell units in the fund. 2. Professional Management Mutual Funds provide the services of experienced and skilled professionals. long-term orientation. You achieve this diversification through a Mutual Fund with far less money than you can do on your own. backed by a dedicated investment research team that analyses the performance and prospects of companies and selects suitable investments to achieve the objectives of the scheme. That is. Typically entry and exit loads range from 1% to 2%. It could be worth paying the load. no commission is payable on purchase or sale of units in the fund. These schemes invest in both equities as well as debt. e) No-Load Funds A No-Load Fund is one that does not charge a commission for entry or exit. By investing in a mix of this nature. HDFC Balanced Fund and HDFC Children’s Gift Fund are examples of hybrid scheme d) Load Funds A Load Fund is one that charges a commission for entry or exit. balanced schemes seek to attain the objective of income and moderate capital appreciation and are ideal for investors with a conservative. That is. The advantage of a no load fund is that the entire corpus is put to work. if the fund has a good performance history. Benefits Of Investing In Mutual Funds 1.Diversification Mutual Funds invest in a number of companies across a broad cross-section of industries and sectors. a commission will be payable. This diversification reduces the risk because seldom do all stocks decline at the same time and in the same proportion. 44 .

custodial and other fees translate into lower costs for investors. delayed payments and follow up with brokers and companies. Mutual Funds save your time and make investing easy and convenient. In closed-end schemes. over the years. 6. Convenient Administration Investing in a Mutual Fund reduces paperwork and helps you avoid many problems such as bad deliveries. the overall objective has been to encourage the growth of the 45 . 8. 4. the proportion invested in each class of assets and the fund manager's investment strategy and outlook. 5. Return Potential Over a medium to long-term. the units can be sold on a stock exchange at the prevailing market price or the investor can avail of the facility of direct repurchase at NAV related prices by the Mutual Fund. Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities.Transparency you get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme. 7. Low Costs Mutual Funds are a relatively less expensive way to invest compared to directly investing in the capital markets because the benefits of scale in brokerage. Liquidity In open-end schemes. the investor gets the money back promptly at net asset value related prices from the Mutual Fund.3. Tax Benefits The taxman has. been more or less kind to mutual funds! With laws varying from time to time.

which are broadly listed below: 1) Capital Gains Units of mutual fund schemes held for a period more than 12 months are treated as longterm capital funds industry. 2) Tax Deducted at Source (TDS) For any income credited or paid by a fund. 4) Income from units Any income received from units of the schemes of a mutual fund specified under section 23 (D) is exempt under Section 10 (33) of the Act. 6) Section 80-C The investment in mutual funds designated as Equity Linked Laving Scheme (ELSS) qualifies for rebate under Section 80-C. In such cases. The relevant sections in the Income Tax Act governing this provision are Section 194K and 196A. a variety of tax laws apply to mutual funds. the unit-holder has the option to pay capital gains tax at either 20 % (with indexation) or 10 % without indexation. income distributed by schemes other than open-end equity schemes is subject to tax at 20 % (plus surcharge of 10 %). no tax is deducted or withheld at source. 5) Income Distribution Tax As per prevailing tax laws. 3) Wealth Tax Mutual fund units are not currently treated as assets under Section 2 of the Wealth Tax Act and are therefore not liable to tax. Disadvantages of Mutual Funds 46 . Currently.

No Control. 4. 2. Buried Costs. 47 .1. Dilution. The Wisdom of Professional Management. 3.

0 28. 48 .0 24.0 Valid Percent 4.0 20.0 65.0 2.Which medium helps u in making investment decisions? Cumulative Percent 4.0 30.0 4.0 95.DATA ANALYSIS Analysis: Q.0 65.0 100.0 Valid Journal reference group Television Newspaper Broker Influencer Total Frequency 4 20 4 2 65 5 100 Percent 4.0 4.0 20.0 2.0 100.0 helps u in making investment decisions journal refrence group television newspaper broker influencer Inference: Most of the investors are influenced by Brokers to invest.0 5.0 100.0 5.

0 100.0 40.0 20.0 25. they prefer another company.0 35.0 Valid Percent 15.0 20.Do you like to invest your funds in same company again? Cumulative Percent 15.0 Do you like to invest your funds in same company again? always sometimes often never Inference: Most of the respondents do not invest in the same company again.0 100.0 40.0 100.0 Valid Always Sometimes Often Never Total Frequency 15 20 25 40 100 Percent 15.0 60.0 25. 49 .

0 100.0 6.0 68.0 30.0 100.0 6.0 Valid Percent 22.0 62.0 20.0 hdfc aviva icici bajaj birla Reliance 50 .0 12.0 12. Which company is best among life insurance companies? Valid Hdfc Aviva Icici Bajaj Birla reliance Total Frequency 22 10 30 6 20 12 100 Percent 22.0 Cumulative Percent 22.0 30.Q.0 32.0 88.0 10.0 100.0 10.0 20.

Are you aware about ULIP plans of life insurance companies? Cumulative Percent 58.0 Valid Yes No Total Frequency 58 42 100 Percent 58.Inference: It’s showing the market share of different insurance companies.0 100.0 51 .0 42.0 42.0 100.0 Valid Percent 58.0 100.

Q.0 22. .0 100.0 52 .0 Valid Yes No Total Frequency 78 22 100 Percent 78.A yo a a ab u U IP p s o life in u ce c m an re u w re o t L lan f s ran o p ies? ye s no Inference: More than 50% of respondents are aware of unit linked insurance plan.0 Valid Percent 78.0 22.0 100.0 100. Are you aware about Mutual Funds? Cumulative Percent 78.

0 100.0 77.0 100.0 Cumulative Percent 23.0 77. Q.Have you ever invested your funds in Mutual Funds? yes no Inference: Around 80% of respondents are aware of Mutual Funds. Are you aware of the charge FMC? Valid Yes No Total Frequency 23 77 100 Percent 23.0 53 .0 Valid Percent 23.0 100.

0 100.0 Valid Yes No Total Frequency 16 84 100 Percent 16.Are you aware of the charge FMC? yes no Inference: Only 23% of respondents are aware of fund management charges.0 Valid Percent 16.0 84.0 84.0 54 .0 100. Do you know FMC is charged under mutual funds? Cumulative Percent 16.0 100.

55 .Do you know FMC is charged under mutual funds? yes no Inference: More than 80% of people are not aware of FMC under Mutual Fund.

Bar Chart Have you ever invested your funds in ULIP? yes no 40 30 Count 20 10 0 married single marital status Marital status * Have you ever invested your funds in Mutual Funds? Cross tabulation Count Have you ever invested your funds in Mutual Funds? Yes marital status Total Married single 45 24 69 no 17 14 31 Total yes 62 38 100 Null Hypothesis: There is no relationship between marital status and investment in MUTUAL FUNDS 56 .

 Misunderstanding of the concept. some amount of error exists in the data filling process because of the following reasons:  Influence of others. 4. 5.  Hurried filling of the questionnaire. The sample size is very less. 3. hence the responses of just 100 respondents does not imply for the complete population. Lastly. 2.DATA REPRESENTATION 25 20 15 10 5 0 Reliance HDFC ICICI LIMITATIONS 1. CONCLUSION 57 . The findings of the survey are based on the subjective opinion of the respondents and there is no way of assessing truth of the statements. There is some respondent’s bias which cannot be removed. There was lack of time and resources that prevented from carrying out an in depth study.

An example would be a life insurance company that focuses only on High Net-worth Individuals (HNIs).The ULIP plans of Reliance are very competitive and have an edge over the plans of other companies as they provide higher returns to there customers. in India most of the life insurance companies have a wide variety of products tailored for different customer needs and there is no company focusing on a particular customer need. it is possible to achieve a unique position by focusing on certain category of products. However. ULIP plans are beneficial from the long term perspective whereas customer should invest in mutual funds if he wants quick returns. to the promotion methods employed 58 .) which will differentiate them from other companies  Needs-based Positioning This is based on the differing needs of different groups of consumers. This can be done successfully if a company has unique strengths to service a group of customer needs better than others The insurance needs of customers vary significantly for different groups of customers. RELIANCE can provide certain distinct services to its customers (such as: providing the information to the clients about there policies over the internet etc. The needs of HNIs would be quite different from those of a general consumer and would require an entirely different marketing mix right from the type of products offered and the way they are distributed. It is a sensible strategy for those companies who have distinctive advantages or strengths in offering certain products and services. Most of the market is still unaware about the ULIP plans and hence by making proper promotional strategy companies can increase there sales. In the insurance industry too. RECOMMENDATIONS  Variety-based Positioning This type of positioning is based on varieties in products and services rather than customer segments.

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