comparision between birla sunlife and lic

A

Project report

On

“Performance evaluation of Birla Sun Life Insurance products in comparison with Life Insurance Corporation (LIC)”

INSTITUTE OF MANAGEMENT AND RESEARCH{Affiliated to C.C.S.University Meerut}

In Partial fulfillment of requirement of degree ofBBA (2007-2010)

SUBMITTED TO: SUBMITTED BY:

MISS. SHIKA ROHIT RAJ RAGHUVANSHI

(Project’s Guide) BBA-6TH SEM.

Roll no. 9051633

1

GUIDE’S CERTIFICATE

This is to certify that the project entitled “”Performance evaluation of Birla Sun Life

Insurance products in comparison with Life Insurance Corporation (LIC)

is being submitted in partial fulfillment of the requirement for the award of becholer ’s

degree of business administration of C.C.S. university Meerut. It is a confined research

work carried out by ROHIT RAJ RAGHUVANSHI under my supervision. Any part of

research work has not been submitted for any other degree. The assistance and help

received during the execution of the project has been fully acknowledged.

MISS SHIKA

PROJECT GUIDER

2

ACKNOWLEDGEMENT

I take this opportunity to express my acknowledgement and deep sense of gratitude

for rendering valuable assistance and guidance to me by following personality for

successful completion of my project.

I am highly obliged to my project guide Miss Shika Madam for his personal

encouragement, prompt assistance and help provided to me in completion of my

project. He has helped me a lot by giving suggestions and guidance whenever needed.

His contribution has been extremely useful and is greatly appreciated. I honor his

knowledge and competence in the field of management.

ROHIT RAJ RAGHUVANSHI

9051633

BBA-6TH SEM

3

PREFACE

To achieve partial and concrete results, it is necessary that theoretical knowledge

must be supplemented with practical environment.

Keeping this view in mind, I have completed my research work regarding

“Performance evaluation of Birla Sun Life Insurance products in comparison

with Life Insurance Corporation (LIC)” By doing this research work I have learnt

a lot of things which would be really helpful for me in future. This experience in

decision making and practical application of knowledge has contributed greatly to

my growth.


4

DECLARATION

I hereby declare that the survey entitled, “Performance evaluation of Birla Sun Life

Insurance products in comparison with Life Insurance Corporation (LIC), that no

part of research work has been submitted for any other degree. I also undertake that work

is purely academic and no part has been copied or taken from any where. The motive

behind the research project was “Performance evaluation of Birla Sun Life Insurance

products in comparison with Life Insurance Corporation (LIC)


9051633

BBA – 6TH SEM.

5

INDEX

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Serial No. Particulars Page No.

1 Introduction to Insurance 8

2. Company profile 16

3. Major competitor LIC 28

4. Various life insurance plans of BSLI 38

5. Various plans of LIC 40

6. Major plans of BSLI 42

7. Major plans of LIC 47

8. Objectives 57

9. Research Methodology 58

10. Data Analysis 60

11. Findings 71

12. Suggestions 73

13. Limitations 75

14. Conclusion 77

15. Bibliography 79

16. Annexure 81

INSURANCE

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The meaning of insurance: Insurance is a policy from a large financial institution that

offers a person, company, or other entity reimbursement or financial protection against

possible future losses or damages.

A simple example will make the meaning of insurance easy to understand. A biker is

always subjected to the risk of head injury. But it is not certain that the accident causing

him the head injury would definitely occur. Still, people riding bikes cover their heads

with helmets. This helmet in such cases acts as insurance by protecting him/her from any

possible danger. The price paid was the possible inconvenience or act of wearing the

helmet; this i.e. equivalent to the insurance premiums paid.

Major types of insurances are as mentioned below:

Life insurance: Descendant’s family receives financial benefits. Life insurances

also offer paid proceeds to the beneficiary.

Automobile insurance: Usually automobile insurances cover damages and legal

financial expenditures of the automobile driver.

Health insurance: Health insurance covers the expenditures associated to treatment

and medical expenditures.

Credit insurance: Borrowers often fail to repay debts, loans and mortgages due to

certain unavoidable circumstances, credit insurances can be of great help during

such crisis.

Property insurance: Property protection insurance provides protection from risks

associated to theft, fire, floods etc.

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Life insurance

Life insurance or life assurance is a contract between the policy owner and the insurer,

where the insurer agrees to pay a sum of money upon the occurrence of the insured

individual's or individuals' death or other event, such as terminal illness or critical illness.

In return, the policy owner agrees to pay a stipulated amount called a premium at regular

intervals or in lump sums.

How life insurance works

There are three parties in a life insurance transaction; the insurer, the insured, and the

owner of the policy (policyholder), although the owner and the insured are often the same

person. For example, if Mr. Rajan buys a policy on his own life, he is both the owner and

the insured. But if Mrs. Anita, his wife, buys a policy on Rajan’s life, she is the owner and

he is the insured. The owner of the policy is called the grantee (he or she will be the

person who will pay for the policy). Another important person involved is the

beneficiary. The beneficiary is the person or persons who will receive the policy proceeds

upon the death of the insured. The beneficiary is not a party to the policy, but is

designated by the owner, who may change the beneficiary unless the policy has an

irrevocable beneficiary designation. With an irrevocable beneficiary, that beneficiary must

agree to changes in beneficiary, policy assignment, or borrowing of cash value.

The policy, like all insurance policies, is a legal contract specifying the terms and

conditions of the risk assumed. Special provisions apply, including a suicide clause

wherein the policy becomes null if the insured commits suicide within a specified time for

the policy date (usually two years). Any misrepresentation by the owner or insured on the

application is also grounds for nullification. Most contracts have a contestability period,

also usually a two-year period; if the insured dies within this period, the insurer has a legal

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http://en.wikipedia.org/wiki/Beneficiary

right to contest the claim and request additional information before deciding to pay or

deny the claim.

The face amount of the policy is normally the amount paid when the policy matures,

although policies can provide for greater or lesser amounts. The policy matures when the

insured dies or reaches a specified age. The most common reason to buy a life insurance

policy is to protect the financial interests of the owner of the policy in the event of the

insured's demise. The insurance proceeds would pay for funeral and other death costs or

be invested to provide income replacing the deceased's wages. Other reasons include

estate planning and retirement. The owner (if not the insured) must have an insurable

interest in the insured, i.e. a legitimate reason for insuring another person’s life. The

insurer (the life insurance company) calculates the policy prices with an intent to recover

claims to be paid and administrative costs, and to make a profit.

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MAJOR PLAYERS OF INDIA IN INSURANCE

Reliance Life Insurance is a part of the Reliance group. It is one of the partners of

Reliance Capital Ltd which is a Anil Dhirubhai Ambani Group. Reliance Capital is one

India's most dominant private sector financial services companies. They offer insurance

products which help you with savings as well as give you protection.

Canara HSBC Life is a joint venture of Canara Bank, HSBC Insurance (Asia pacific) &

Oriental bank of Commerce. The Company got its approval from IRDA in June 2008 and

from that commencing its business. They have more than 4100 branches all over India.

DLF pramerica Life Insurance Company Ltd. is a joint venture between DLF Limited &

Prudential International Insurance Holdings Limited. DLF Pramerica believes in

delivering a secure & enrich life to there customers.

MetLife One of the fastest growing insurance company in India is MetLife. The company

started its operations in between 2000-2001. They have a range of various products to

offer.

ICICI Prudential ICICI Bank with Prudential plc, both well known & strong financial

institutions came together in December 2000 to form an insurance company - ICICI

Prudential Life Insurance.

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Max New York Life Max India’s leading multi business corporation & New York Life

joined there hands in 2000.The company started there operations in 2001. The company is

involved in Life & health products.

Bajaj Allianz Bajaj who are into iron & steel, finance, insurance & etc and Allianz who

provides financial services when came together they formed Bajaj Allianz Life Insurance

Company.

Bharti AXA Bharti AXA Life Insurance is a joint venture between Bharti & AXA. The

company started its functionality in December 2006 and they always believe to be a strong

financial institute.

HDFC Standard Life HDFC Standard Life Insurance is a joint venture between Housing

Development Finance Corporation Limited & a Group of Standard Life Plc.The Company

started commencing its business in December 2000.

AEGON Religare AEGON Religare Life Insurance Company Ltd is a joint venture with

AEGON, Religare and Bennett, Coleman & Company a part of Times Group. AEGON

Religare Life Insurance company was launched in July 2008.

Kotak Mahindra A joint venture of Kotak Mahindra group & Old Mutual plc is known

as Kotak Mahindra Old Mutual Funds. The Company started commencing its business in

2001. The company aim is to help customers in making there financial decisions.

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Future Generali Life Future Generali is a joint venture between Future Group of India &

Italy based Generali Group.Future Generali in India is into both Life & Non Life

businesses in India. The company wants to provide a financial security to all.

SBI Life SBI Life Insurance Company Limited is a joint venture between State Bank of

India and BNP Paribas Assurance. It is present in more than 41 countries across the world.

SBI Life offers a variety of plans in life insurance and pension.

Shriram Life Shriram Life Insurance Company is a joint venture between Shriram

Group and Sanlam Group.Shriram Group is one of India’s most esteemed financial

services & Sanlam Group is one of the largest life insurance providers of South Africa.

TATA AIG The TATA Group and American International Group Inc together formed

Tata AIG Life Insurance Co. Ltd.Tata Group holds 74% stake in the insurance venture

with AIG holding the balance 26%. They started their operations in April 2001

Aviva Aviva, one of UK's largest insurance company and world's 5th largest insurance

group. It was one of the first international insurance company to set up its office in India

in the year 1995. They introduced the concept of banc assurance in India.

IDBI Fortis IDBI Fortis Life Insurance Co. Ltd is a joint venture between three financial

institutes; they are IDBI Bank, Federal Bank and Fortis. They introduced there plans in

March 2008. IDBI owns 48% equity while Federal Bank and Fortis own 26% equity each.

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Sahara The Sahara Pariwar stepped into the insurance business by launching Sahara India

Life Insurance Co. Ltd. They received the IRDA license in February 2004 and started

their operations in October 2004. They are the first solely owned private sector insurance

company in India.

ING VYSYA ING Life was established in 2001 as a joint venture between ING Insurance

International B.V. (INGI), ING Vysya Bank Limited and GMR Industries Limited. At

present, INGI, Exide Industries Limited, Ambuja Cement Ltd, Enam Group are the joint

venture partners.

Star Union Star Union Dai-ichi Life Insurance Co.Ltd. Is formed by three various

financial institutions. Bank of India, Union Bank of India and Dai-ichi Mutual Life

Insurance Company This firm was incorporated in the year 2007 and got their IRDA

license on the 26th Dec 2008.

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Some of the important milestones in the life insurance business in India are:

1818: Oriental Life Insurance Company, the first life insurance company on Indian soil

started functioning.

1870: Bombay Mutual Life Assurance Society, the first Indian life insurance company

started its business.

1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the

life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to collect

statistical information about both life and non-life insurance businesses.

1938: Earlier legislation consolidated and amended to by the Insurance Act with the

objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies are taken over by the central

government and nationalised. LIC formed by an Act of Parliament, viz. LIC Act, 1956,

with a capital contribution of Rs. 5 crore from the Government of India.

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Birla Sun Life Insurance Company Limited is a joint venture between The Aditya

Birla Group, one of the largest business houses in India and Sun Life Financial Inc., a

leading international financial services organisation. The local knowledge of the Aditya

Birla Group combined with the expertise of Sun Life Financial Inc., offers a formidable

protection for your future.

The Aditya Birla Group has a turnover of close to Rs. 119000 crores, with a market

capitalisation of Rs. 133875 crores (as on 31st March 2008). It has over 100,000

employees across all its units worldwide. It is led by its Chairman - Mr. Kumar Mangalam

Birla. Some of its key companies are Hindalco, Grasim and Aditya Birla Nuvo.

Sun Life Financial

Sun life financial –based in Canada-started in 1865.

It operates in all the important markets of the world like Canada, the United States, the

United Kingdom, Hong Kong, the Philippines, Japan, Indonesia, India, China and

Bermuda.

Sun Life Financial Inc. has assets under management of over US$404.7 billion (as on 31st

March, 2008). It is a leading performer in the life insurance market in Canada.

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Birla Sun Life Insurance (BSLI) has been operating for 9 years. It has contributed

significantly to the growth and development of the life insurance industry in India. It

pioneered the launch of Unit Linked Life Insurance plans amongst the private players in

India. It was the first player in the industry to sell its policies through the Bancassurance

route and through the Internet. It was the first private sector player to introduce a Pure

Term plan in the Indian market. BSLI has covered more than 2 million lives since it

commenced operations. And its customer base is is spread across more than 1500 towns

and cities in India. The company has a capital base of Rs. 1274.5 crores as on 31st March

2008.

With an experience of over 9 years, BSLI has contributed significantly to the growth and

development of the life insurance industry in India and currently ranks amongst the top 5

private life insurance companies in the country.

Known for its innovation and creating industry benchmarks, BSLI has several firsts to its

credit. It was the first Indian Insurance Company to introduce “Free Look Period” and the

same was made mandatory by IRDA for all other life insurance companies. Additionally,

BSLI pioneered the launch of Unit Linked Life Insurance plans amongst the private

players in India. To establish credibility and further transparency, BSLI also enjoys the

prestige to be the originator of practice to disclose portfolio on monthly basis. These

category development initiatives have helped BSLI be closer to its policy holders’

expectations, which gets further accentuated by the complete bouquet of insurance

products (viz. pure term plan, life stage products, health plan and retirement plan) that the

company offers.

Add to this, the extensive reach through its network of 600 branches and 1,75, 000

empanelled advisors. This impressive combination of domain expertise, product range,

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reach and ears on ground, helped BSLI cover more than 2 million lives since it

commenced operations and establish a customer base spread across more than 1500 towns

and cities in India. To ensure that our customers have an impeccable experience, BSLI has

ensured that it has lowest outstanding claims ratio of 0.00% for FY 2008-09. Additionally,

BSLI has the best Turn around Time according to LOMA on all claims Parameters. Such

services are well supported by sound financials that the Company has. The AUM of BSLI

stood at Rs. 8165 crs as on February 28, 2009, while as on March 31, 2009, the

company has a robust capital base of Rs. 2000 crs.

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Achievements of BSLI 1st to introduce ULIP fund options.

1st to launch illustrations so that customers understand the products better before

they buy.

1st to issue NAVs of funds for better transparency.

1st to disclose portfolio on a monthly basis.

1st to introduce “Free Look Period” and the same was made mandatory by IRDA for all other Life Insurance Companies.

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SWOT ANALYSIS OF BSLI

STRENGTH:

Multi-channel distribution and one of the largest distribution

networks in India.

1 Million Policies sold within 3 and half years.

Training process of the company is very strong.

According to the change in surrounding environment like changes in

customer requirement.

WEAKNESS:

Company does not penetrate on the rural market at a time.

There is no plan for the low income group.

Fees for the advisor is high than the other companies.

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OPPORTUNITY:

Insurance market is very big, where company can expand its business

easily.

It has many ULIP plans so it can grow in near future.

THREATS:

‘OLD HABITS DIE HARD’: Its still difficult task to win the confidence of

public towards private company.

The company is facing major threats from LIC etc. -which is an

government company.

Plans for all income groups are not available which can create adverse effect later

on the market share of the company.

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MAJOR COMPETITOR AT A GLANCE LIC (LIFE INSURACE

CORPORATION)

LIC had 5 zonal offices, 33 divisional offices and 212 branch offices, apart from its

corporate office in the year 1956. Since life insurance contracts are long term contracts

and during the currency of the policy it requires a variety of services need was felt in the

later years to expand the operations and place a branch office at each district headquarter.

re-organization of LIC took place and large numbers of new branch offices were opened.

As a result of re-organisation servicing functions were transferred to the branches, and

branches were made accounting units. It worked wonders with the performance of the

corporation. It may be seen that from about 200.00 crores of New Business in 1957 the

corporation crossed 1000.00 crores only in the year 1969-70, and it took another 10 years

for LIC to cross 2000.00 crore mark of new business. But with re-organisation happening

in the early eighties, by 1985-86 LIC had already crossed 7000.00 crore Sum Assured on

new policies.

Today LIC functions with 2048 fully computerized branch offices, 100 divisional

offices, 7 zonal offices and the Corporate office. LIC’s Wide Area Network covers 100

divisional offices and connects all the branches through a Metro Area Network. LIC has

tied up with some Banks and Service providers to offer on-line premium collection facility

in selected cities. LIC’s ECS and ATM premium payment facility is an addition to

customer convenience. Apart from on-line Kiosks and IVRS, Info Centres have been

commissioned at Mumbai, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, New

Delhi, Pune and many other cities. With a vision of providing easy access to its

policyholders, LIC has launched its SATELLITE SAMPARK offices. The satellite offices

are smaller, leaner and closer to the customer. The digitalized records of the satellite

offices will facilitate anywhere servicing and many other conveniences in the future.

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LIC continues to be the dominant life insurer even in the liberalized scenario of Indian

insurance and is moving fast on a new growth trajectory surpassing its own past records.

LIC has issued over one crore policies during the current year. It has crossed

milestone of issuing 1,01,32,955 new policies by 15th Oct, 2005, posting a healthy growth

rate of 16.67% over the corresponding period of the previous year.

From then to now, LIC has crossed many milestones and has set unprecedented

performance records in various aspects of life insurance business.

Birla Sun Life Insurance Co. Ltd

Following are the Life Insurance plans that Birla Sun life Insurance Company Ltd.

1.)Birla Sun Life Insurance Term Plan - This plan can take care of your financial

commitments of yours towards your family by providing large cover at low cost.

Minimum age of entry for this plan is 18-55 and maximum maturity age is 70 years.

2. Birla Sun Life Insurance Premium Back Term Plan - This is a low cost life cover

promises you to refund the entire premium on maturity or death. Two options are also

there to choose 100% premium back or 125% premium back. Maximum term period

for this plan is 20 years.

3. Birla Sun Life Insurance Guaranteed Bachat Plan - It’s an non participating

endowment plan offers you guaranteed returns and chance to earn survival benefit

from the 3rd year onwards. You can withdraw this benefit each tear or can use it as to

pay the premium dues.

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4. Birla Sun Life Insurance Money Back Plus Plan - This is also a non-participating

endowment plan, which gives you maturity and survival both benefits. One remarkable

point is that on every policy anniversary it increases your cover by an equal amount of

your base premium.

5. Birla Sun Life Insurance Gold-Plus II - It’s an investment plan offering nine-

funding option to choose and 100% equity fund option also. Free unlimited switches

are given to you to manage your investments. This plan offers good liquidity to you.

6. Birla Sun life insurance Platinum Plus - It is a unit linked, non participating

insurance plan. In this plan, the investment risk is borne by the policyholder but not if

this policy is detained till maturity.

7. Birla Sun Life Insurance Saral Jeevan Plan - In today’s fast life it’s really easy to

buy an insurance plan, which you immediately can purchase just by providing three

health statements to the company. Bsli Saral Jeevan is the best option to go for.

8. Birla Sun Life Insurance Supreme-Life - It’s a unit linked non-participating plan

providing 8-fund options to choose. It gives a choice of two death benefits.

9. Birla Sun Life Insurance Dream Plan - It’s a unit-linked policy, which provides

you guaranteed returns, 0% allocation charges, and option to double or triple the

guaranteed maturity.

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10. Birla Sun Life Insurance ClassicLife Premier - It will give you guaranteed

additions in the form of guaranteed units and a good choice of 8 investment funds are

also there. You are free to choose the term period of 10,20,30 or whole life.

11. Birla Sun Life Insurance SimplyLife - It ensures a lifetime of tax-free

investments to fulfill the needs of your dear ones. It’s a market related plan provides

you a good death benefit amount.

12. Birla Sun Life Insurance PrimeLife Premier - It’s a single time investment with

top up options. It keeps you hassle free and provides you guaranteed returns at regular

intervals.

13. Birla Sun Life Insurance PrimeLife - It is a single premium policy gives you the

benefit of life insurance and investments as well. It’s a non-participating ULIP policy.

14. Birla Sun Life Insurance Flexi Cash Flow - For this policy you can pay lump

sum premium payment at regular intervals. It will give you 3% guaranteed returns on

net policy charges.

15. Birla Sun Life Insurance Flexi Save Plus - This plan will give you the choices of

3 fund options, maturity ages & guaranteed returns of 3%.

16. Birla Sun Life Insurance Flexi Life Line - This would provide you a life long

cover till 100 years of age and will give you the option of tax-free partial withdrawals.

17. Birla Sun Life Insurance Single Premium Bond - This plan gives you the

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opportunity to make one time investment with no medical tests and will also gives you

the facility of high entry age. It’s a short term investment plan provides you the option

of 5 years or 10 years term period.

18. Birla Sun Life Insurance Freedom 58 - It’s a non- participating ulip plan. It helps

you accumulate your premiums and the investment return there of into a corpus of your

retirement.

19. Birla Sun Life Insurance Flexi Secure Life Retirement Plan II - This will

provide you the option to take a life cover or not. You can choose your retirement age

yourself whether you want to prepone/postpone it.

20. Birla Sun Life Insurance Children's Dream Plan - It’s a unit-linked policy,

which provides you guaranteed returns, 0% allocation charges, and option to double or

triple the guaranteed maturity.

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Various Plans offered by LIC are as follows :

Endowment Assurance Plans

1. Jeevan Amrit : This plan is designed for a higher cover at a lower cost. In this plan

premium payment is limited to 3 or 4 or 5 years and the premium payable during the first

year is higher than the premiums payable in subsequent years.

2. New Janaraksha Plan : Is an Endowment Assurance plan that provides financial

protection against death throughout the term of plan. It pays the maturity amount on

survival to the end of the term.

3. Jeevan Mitra(Double Cover Endowment Plan) : Is an endowment plan which takes

care of the financial needs even if death of the policyholder for the whole term of the plan.

4. Jeevan Mitra (Triple Cover Endowment Plan) : Is an endowment plan where thrice

the Sum Assured plus all bonuses on the basic sum assured to date is payable in a lump

sum upon the death of the life assured.

5. The Endowment Assurance Policy : This policy has a provisions for the family of the

Life Assured in event of his early death and also assures a lump sum at a desired age.

6. The Endowment Assurance Policy-Limited Payment : In this policy the payment of

premium can be limited either to a single payment or to a term shorter than the policy.

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Children Plans

1. Jeevan Anurag : Is plan designed for the children educational requirements . This plan

can be taken on the parent’s life. The basic sum assured is given immediately on the death

of the life assured during the term of the policy.

2. Jeevan Kishore : Is a plan which can be availed by the parent or grand parents of the

children. It is an endowment assurance plan for children of less than 12 years of age.

3. Jeevan Chhaya : It is a plan where financial protection is given against death during

the term of the plan. It is an Endowment Assurance plan. Besides this benefit one-fourth

of Sum Assured is payable at the end of each of last four years of policy term irrespective

if the life assured dies or survives the duration of the policy.

4. Komal Jeevan : Is a Money Back Plan which can be bought by the parent or grand

parent for their child from the age of 0-10years. This plan gives financial protection

against death during the duration of the plan with periodic payments on survival at

specified durations.

5. Child Future Plan : A policy where the future needs like education, marriage and

other requirements are taken care of. This plan provides a benefit which not only takes

care of the risk cover of the child during the policy but also after 7 years of the policy

being expired.

6. Child Career Plan : A plan to meet the educational and other needs of the child. It

provides the risk cover on the life of child during the policy term as well as 7 years after

the policy has expired. There are also Survival benefits given to the life assured at the end

of a specific duration.

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7. Child Fortune Plan : Is a unit linked plan which offers long term capital appreciation.

8. Marriage Endowment Or Educational Annuity Plan : This is an Endowment

Assurance plan that provides for benefits on or from the selected maturity date to meet the

Marriage/Educational expenses of the named child.

Money Back Plan

1. Bima Bachat : Is a money-back policy which offers financial security and assurance to

the policy holder and his family. The policy holder has to pay only one premium.

2. Money Back-20 years : Is an endowment plan where periodic payments of partial

survival benefits are paid during the term of the policy till the policy holder is alive.As the

policy name goes this plan 20% of the sum assured is payable after 5,10,15 years and the

balance 40% accrued bonus is payable at the 20th year.

3. Money Back 25 years : Is the same as the above plan only in this plan the 40% accrued

bonus is payable at the 25th year.

Pension plans

1. New Jeevan Dhara - I : is a Deferred Annuity plans that allows the policyholder to

make provision for regular income after the selected term.

2. New Jeevan Suraksha - I : Is a deferred annuity plan.

3. Jeevan Nidhi : Is a deferred annuity plan with profits.

4. Jeevan Akshay - VI : By paying a lump sum amount this immediate annuity plan can

be bought.

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Unit Plans

1. Child Fortune Plus : Is a plan for children and to meet their educational needs. Its a

unit linked plan with long term capital appreciation.

2. Fortune Plus : It is a unit linked assurance plan where premium payment term (PPT) is

5 years and the premium payable in the first year will be 50% of total premium payable

under the policy.

3. Market Plus : Is a unit linked pension plan where after a specific period the pension is

paid.

4. Money Plus - I : Is a unit linked Endowment plan which has investment plus insurance

during the term and you can pay regular premiums.

5. Profit Plus : It is a unit linked Endowment plan where the premium payment term

(PPT) is limited to single lump sum, or uniformly over 3, 4 or 5 years.

Whole Life Plans

1. Jeevan Anand : Is a combination of two plans- Endowment Assurance and Whole Life

plan.

2. Jeevan Tarang : This is a with-profits whole of life plan which provides for annual

survival benefit at a rate of 5½ % of the Sum Assured after the chosen Accumulation

Period.

3. The Whole Life Policy : Is a plan mainly to provide for payment of sum assured plus

bonuses on the death of the policyholder.

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Golden Jubliee Plan

New Bima Gold : Where the premiums are paid back during the policy term in

installments , besides that life insurance cover is given during the also at the extended

term of the plan.

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Some main Plans of BSLI:

(1) Birla Sun life insurance Platinum Plus - It is a unit linked, non participating

insurance plan. In this plan, the investment risk is borne by the policyholder but not if this

policy is detained till maturity.

Policy parameters

Entry age 18-70

Minimum annual premium Rs. 50000

Minimum sum assured 5*annual premium

Policy term 10 years

Premium paying term 3 years

Premium and sum assured

You can pay your policy premium annually, half-yearly, quarterly or monthly, subject to a

minimum installment premium of:

Rs. 50,000 per annum

Rs. 25,000 half-yearly

Rs. 15,000 quarterly; or

Rs. 10,000 per month (3 monthly installments required at issue)

You choose your Sum Assured (minimum 5 x annual premium).

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Risk profile

0-40% in money market & cash

0-100% in debt instruments & derivatives

0-100% in equities & equity related securities.

Maturity Benefit

On maturity, your Fund Value will be paid to you.

In addition, we will pay an amount equal to:

the number of units under your policy at that time; times

the excess, if any, of the Guaranteed Maturity Unit Price over the then prevailing

unit price

Death Benefit

In the unfortunate event of the death of the life insured prior to the maturity date of the

policy, we will pay to the nominee the greater of (a) the Fund Value or (b) the Sum

Assured reduced for partial withdrawals as follows:

Before the life insured attains the age of 60, the Sum Assured payable on death

is reduced by partial withdrawals made in the preceding two years.

Once the life insured attains the age of 60, the Sum Assured payable on death is

reduced by all partial withdrawals made from age 58 onwards.

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Partial withdraw

Partial withdraw after 3 complete policy years.

Minimum partial withdraw rs.5000

Policy surrender After 3 policy years and you will get 100% fund value at that time.

(2) Birla Sun Life Insurance children’s Dream Plan –

Policy parameters

Entry AgesLife Insured (parent): 18 years – 60 yearsNominee (child) : 30 days – 13 years

Term 18 years less the age of child at entry

Premium paying frequency

Regular policy premiums can be paid yearly, half-yearly, quarterly or monthly (for ECS only)

Addition of riders Accidental Death & Dismemberment Benefit (ADD)

40

The annual policy premium is based on:

The guaranteed maturity benefit and option you choose.

The enhanced sum assured you desire.

The plan term and your gender and age at entry.

Guaranteed Fund Value

Equals all premiums paid, less charges and guaranteed maturity benefit(s), accumulated at 3% per annum

Partial Withdrawals

Allowed after 3 complete policy years

Investment Funds Protector, Builder, Enhancer

AT Death Benefit

The sum assured is paid to the nominee upon the death of the life insured (parent)The new life insured is the child and new owner is appointed as per your wishes.The policy is continued as usual except:•All riders and risk charges will cease•Only the policy administration charge and fund management charge continue, and•BSLI will start paying the Maturity Continuation Benefit on a monthly basis until the policy matures.In case of death of the new life insured (child) prior to the end of the Term, higher of 105% of the Fund Value or the Guaranteed Fund Value will be paid and the policy will be terminated.

41

Charges of policy

Premium allocation charges

Fund management charges

Mortality charges

Surrender charges etc.

42

(3) Birla Sun Life Insurance Saral Jeevan Plan – The saral jeevan

plan provides the dual benefit of protection and investment. So it is the ideal policy if

you want to secure your life and build wealth at the same time.

Poicy parameters

Entry age 18-55

Policy term 10, 15, and 20 years

Age at maturity 65 or less

Mode of Premium Payment - Annual, Semi Annual, Quarterly, Monthly.

Maturity Benefit

Maturity benefit will be sum assured plus fund value at the end of maturity time.

Death Benefit – Your nominee will receive both sum assured and fund value in the unfortunate event of death.

Investment Funds

Protector

Builder

Enhancer

Charges of Policy

Premium Allocation Charge- Nil (This means all of your policy premium will be

invested in the investment funds of your choice).

Fund Management Charge

Mortality charges

Surrender charges etc.

(4) Birla Sun Life Universal Health Plan-

43

The universal health plan is in addition to the benefit amount payable under each health

benefit. This unique benefit helps you and your family with out of pocket health related

expenses.

Policy parameters

Entry Ages 18 years – 65 years

Term 3 years


policy premiums can be paid yearly, half-yearly, quarterly or monthly

Premium According to age of the insured person. (e.g. for 25 – Rs. 4756 p.a., for 45- Rs. 6725 p.a., for 55- Rs. 9724 p.a.).

Benefits –

1. BSLI pay a fixed benefit amount of Rs. 1000 per day in Hospital plus Rs. 1000 per

day in Intensive Care Unit (ICU).

In case of an admission for surgical management :

2. if the surgery is listed in covered surgeries: BSLI pay a fixed benefit amount based

on the grade of the covered surgery-Rs. 100000, Rs. 50000, Rs. 25000, Rs. 15000

and Rs. 10000 for grade 1(major) to 5(minor) respectively.

3. if the surgery is not listed in the covered surgeries: BSLI pay a fixed benefit amount

of Rs. 2000 per day in hospital plus Rs. 1000 per day in ICU.

Tax benefit

44

The premium paid by you up to 15000 (Rs.20000 for senior citizens) p.a. to insure

yourself and/or your family, is eligible for tax benefit under section 80D of the income

Tax Act, 1961, which is subject to amendments from to time.

Death/Maturity benefit

This plan has no death benefit or maturity benefit. Furthermore, this plan provides for

no cash surrender value nor any policy loans.

(5) Birla Sun Life Retirement plan

Policy parameters

Entry Ages 18 years – 80 years

Term


policy premiums can be paid yearly, half-yearly, quarterly or monthly

Premium Minimum Rs. 9600 p.a.(premium should be multiple of Rs. 1200)

Benefits

In the unfortunate event of death of the policyholder the nominee will receive the higher of:

75% of the base premium and all renewal base premiums paid. OR the surrender value at the time plus all accumulated survival benefits.

45

Tax benefits

Under section 80CCC and 10(10A)

Partially withdraw

You can do partially withdraw min. Rs.5000

46

Some main plans of LIC (1) Marriage Endowment Or Educational Annuity Plan : This is an

Endowment Assurance plan that provides for benefits on or from the selected maturity

date to meet the Marriage/Educational expenses of the named child.

Entry age 18 (min.) 60(max)

Sum assured 50000 (min) no limit (max)

Term 5 (min) 25 (max)

Mode of payment monthly, qtly, half yrly, yly,

FEATURES

The Marriage Endowment/ Educational annuity plan provides a sum assured to be kept

aside for the expenses of marriage or higher education of the policyholder's children.

Premiums payable for selected term or till death of the life Assured. Benefits will be given

only after the selected term.

Maturity benefits

Sum Assured + Bonus

Accident:

Accident benefit equivalent to basic sum assured would be available by paying

appropriate additional premiums in that behalf. An amount equivalent to Sum Assured

become payable immediately.

47

(2) Jeevan saral plan of LIC

Plan Details: This plan is appropriate for employees seeking life cover through Salary

Savings Schemes.

Eligibility:

Minimum Maximum

Age 12 Yrs (completed) 60 Nearest Birthday

Term 10 35

Age at maturity Maximum 70 years

In case of term rider, minimum and maximum age of entry will be 18 and 50 years

respectively. Further minimum sum assured will be Rs.1 lakh.

Premium:

Minimum premium: Rs 250 per month for entry age up to 49 years and Rs.400 per month

for entry age 50 years and above. The premium shall be in multiple of Rs.50 per month.

Premium Mode:

Yearly, Half yearly, Quarterly and Monthly under Salary Saving Scheme.

Survival Benefits:

The sum payable at maturity however differs for different entry ages and terms. On

Maturity the individual will receive maturity sum assured, plus Loyalty additions, if any.

The specimen Maturity Sums Assured (MSAs) per Rs.100/- monthly premium are given

below for some of the ages and terms:

48

Age at Entry

Policy Term

10 yrs 15 yrs 20 yrs 25 yrs

20 11,156 19,628 28,039 36,839

40 10,431 17,839 24,598 30,854

50 8,442 13,444 16,164

Death Benefits:

Under this plan death cover will be same irrespective of age at entry and term. On death

the nominee will receive 250 times the monthly premium, plus return of premiums

excluding extra/rider premium premium.

(3) New Jeevan Suraksha Plan

This pension plan is a vehicle for planning a life long pension and is also tax deferred. Not

only can you plan a pension for life with the help of these annuities but these schemes also

help you reduce your tax liability.

49

POLICY PARAMETERS

Min Max

Entry Age 18 70

vesting age 50 79

deferment period 2 years35 years.

Premium Rs. 250 p.m.

Mode of paymentYearly, half yearly, quarterly, monthly

Features

AMOUNT (Rs) >=1,00,000 <

2,00,000>=2,00,000 <

5,00,000 >= 5,00,000

Rebates Available for Single Premium

3% 4% 5%

Rebates Available for Annual Premium

6% 7% 8%

50

Death Benefits

If death occurs within 10 years - 3% (interest on all premium given)

Between 11 to 20 years 4%

After 20 years 5%

(4) LIC's Market plus Plan

It is a unit linked deferred pension plan. The policyholder can choose the plan with or

without risk cover. He can also choose the level of cover within the limits, which will

depend on the mode and amount of premium he/she desires to pay. The allocated premium

will be utilized to buy units as per the selected fund type.

The Policyholder's Unit Account will be subject to deduction of charges. Units will be

allotted and cancelled based on the Net Asset Value (NAV) of the respective fund of the

date of allotment / cancellation. There is no Bid-Offer spread (both the Bid price and

Offer price of units will be equal to the NAV). The NAV will be declared on a daily basis

and will be based on the investment performance, Fund Management Charges (FMC) and

whether fund is expanding or contracting under each fund type.

51

Policy parameters

Entry age 18-70

Premium (Min) Rs. 5,000 p.a. for Regular premium and Rs. 10,000 for Single

premium

(Max) No limit

Vesting age 40-75

Sum Assured (min) NIL- (when no life cover is opted) Rs. 25,000 for Single

premium, Rs. 50,000 for Regular premium (When life cover is opted)

(Max) Regular Premium - 20 times of the annualized premium.

Minimum Deferment period 5 years

Invesment fund types:

Fund Type

Investment in Govt. / Govt. Guaranteed Securities / Corporate Debt

Short-term investments such as money market instruments(Including Govt. Securities & Corporate Debt)

Investment in Listed Equity Shares

Bond Fund Not less than 80% 100% NIL

Secured Fund Not less than 65% Not more than 85%Not less than 15% and not more than 35%

Balanced Fund Not less than 50% Not more than 70% Not less than 30% and not more than 50%

Growth Fund Not less than 20% Not more than 40%Not less than 60% and not more than 80%

COMPARISON BETWEEN SOME MAIN PRODUCTS OF BSLI AND LIC

52

1) Comparison between BSLI’s Children dream plan and LIC’s Marriage Endowment Or Educational Annuity Plan:

In BSLI plan policy term is 18 years less the age of child at entry.

But in LIC plan policy term is 5-25 years.

Premium paying frequency is almost same i.e. yearly, half yearly, quarterly,

monthly.

In case of death benefit: in BSLI plan the sum assured is paid to the nominee upon

the death of the life insured (parent). The new life insured is the child and new

owner is appointed as per your wishes.

In LIC plan if death occurs due to accident then basic sum assured is payable on

death immediately and further premiums are not payable.after expiry of the term again

basic sum assured + bonus is payable.

In BSLI fund value is guaranteed.

o In LIC plan fund value is not guaranteed.

53

2) Comparison between BSLI’s Saral jeevan plan and LIC’s Jeevan saral plan

In BSLI plan entry age is 18-55 years

In LIC plan entry age is 12-60 years

In BSLI policy term is 10, 15, and 20 years.

In LIC policy term is 10-35 years.

In BSLI plan max. Maturity age is 65 years

In LIC plan max. Maturity age is 70 years.

In BSLI min. premium is 10000 p.a.

In LIC plan min. premium is 5000p.a.

54

3) Comparison between BSLI’s Retirement plan and LIC’s New Jeevan Suraksha plan.

In BSLI plan entry age is 18-80 years

In LIC plan entry age is 18-70 yrs.

In BSLI plan vesting age is 10-40 yrs from entry age (Max. 90yrs.)

In LIC plan vesting age is 50-79 yrs.

In BSLI plan min. premium is 9600 p.a.

In LIC plan min. premium is 3000 p.a.

Premium paying frequency is same i.e yearly, half yearly, quarterly, and monthly

Death Benefits:

In BSLI plan the unfortunate event of death of the policyholder the nominee will

receive the higher of:

75% of the base premium and all renewal base premiums paid. OR the surrender

value at the time plus all accumulated survival benefits.

In LIC plan

If death occurs within 10 years - 3% (interest on all premium given)

Between 11 to 20 years 4%

After 20 years 5%

55

4) Comparison between BSLI Platinum plus plan and LIC Market plus plan

Entry age in BSLI and LIC is same i.e. 18-70 years.

In BSLI min. annual premium is 50000p.a.

In LIC plan premium is 10000p.a.

In BSLI plan maturity benefit is guaranteed

In LIC plan maturity benefit is not guaranteed

56

Objectives of study

To determine and analyze the Market Potential of the Birla Sun Life Insurance

Company in MOGA City.

To study and determine the competitor (LIC) position in the market.

To analyze market share of Birla Sun Life Insurance products in Moga city.

To analyze the customer satisfaction regarding LIC and BSLI.

57

RESEARCH METHODOLOGY -

MEANING OF RESEARCH-

Before understanding Research Methodology, we should understand the meaning

of research. Research in common parlance refers to a search for knowledge. One can also

define Research as a scientific and systematic search for pertinence information on a

specific topic. In fact, research is an art of scientific investigation.

DEFINITION OF RESEARCH-

Research is a systematized effort to gain new knowledge”

Redmann & Mory

MEANING OF RESEARCH METHODOLOGY-

Research Methodology, it is a way to systematically solve the research Problem. It may

be understood as a science of studying how research is done scientifically. In it we study

the various steps that are generally adopted by the researcher in studying his research

problem along with the logic behind them. It is necessary for the researcher to know not

only the research.

Data Collection: - The objectives of the project are such that both primary and secondary

data is required to achieve them. So both primary and secondary data was used for the

project. The mode of collecting primary data is questionnaire mode and sources of

secondary data are various magazines, books, newspapers, & websites etc.

58

Primary data

The primary data are those data which are collected afresh and for the first time, and thus

happen to be original in character.

Secondary data

The secondary data on the other hand, are those which have already been collected by

someone else and which have already been passing through the statistical process.

Sample size –

100 people of MOGA City were selected

Research ----- Purposive research

59

1) Do you think that investment in Insurance sector is good option?

Particulars No. of respondents

Yes 90

No 10

No. of respondents

yes, 90

no, 10

yesno

Interpretation: 90 people say that investment in insurance sector is good option and 10 are saying not.

61

2) Which company’s policy do you have?


BSLI 40

LIC 60

BSLILIC

No. of respondents

40

60

0

10

20

30

40

50

60

Interpretation: 40 people have BSLI policies and 60 have LIC.

62

3) Which type of policy you have?

Particulars No. of respondents LIC

No. of respondents BSLI

Whole life plan 20 10

Retirement plan 10 4

Children plan 18 22

Health plan 6 4

Golden jubilee plan 6 0

Total 60 40

20

10

18

6 6

10

4

22

4

00

5

10

15

20

25

No. of respondents LIC


63

Interpretation: 20 people of LIC and 10 of Birla have whole life plan, 18 people of LIC and

22 of birla have

4) What percentage of interest you get from it?



Below 5 % 0 0

5-8 % 14 6

8-12 % 42 28

Above12 % 4 6

0 0

14

6

42

28

46

0

5

10

15

20

25

30

35

40

45

Below 5 % 5-8 % 8-12 % Above12 %

No. of respondents LIC


64

Interpretation: 14 people of LIC and 6 of Birla are getting 5-8% R.O.I., 42 people of

LIC and 28 of Birla are getting 8-12% interest.

5) Why do you invest in this(LIC/BSLI) company?



High interest 8 12

Good image of CO. 12 4

Growth of the CO. 18 12

Annual premium is reasonable 10 4

Maturity benefits 12 8

8

12

18

10

12

12

4

12

4

8

0 5 10 15 20

High interest

Good image of CO.

Growth of the CO.

Annual premium isreasonable

Maturity benefits

65

Interpretation: 12 people of Birla are investing in this company due to its high interest,

18 people of LIC say that they are investing in LIC due to growth of the co.

6) Do you think that investment in BSLI is better than LIC ?


Yes 44

No 56

44

56

No. of respondentsYes No

Interpretation: 44 people are saying that investment in BSLI is better than LIC, but 56

are saying no.

66

(If NO then go to Q.N. 8 otherwise Q.N. 7)

7) If yes, then why?


Guaranteed F.V. at maturity 10

Growth rate 16

More ULIP plan 8

Risk covered 4

All above 6

No. of respondents

10

16

8

4

6 Guaranteed F.V. atmaturityGrowth rate

More ULIP plan

Risk covered

All above

67

Interpretation: 16 people are saying that because BSLI gives guaranteed F.V. at maturity

time, 8 are saying it has more ULIP plans.

8) If no, then why?


LIC have govt. stake 24

Brand loyalty of LIC 14

Low A.P. than BSLI 12

High return 6

LIC have govt. stake, 24

Brand loyalty of LIC, 14

Low A.P. than BSLI, 12

High return, 6

LIC have govt. stake

Brand loyalty of LIC

Low A.P. than BSLI

High return

68

Interpretation: 24 people are saying that investment in LIC is better it has govt. stake, 14

are saying it has brand loyalty.

9) When company launch new product , then any information is given to you about that product?



Yes 24 16

No 36 24

No.

of

resp

onde

nts

LIC

No.

of

resp

onde

nts

BS

LI

Yes

No

36

2424

16

05

10152025303540

YesNo

69

Interpretation: 24 people of LIC are saying yes and 36 are saying no, 16 people of BSLI

are saying yes and 24 are saying no about providing information.` 67

10) In near future, do you think BSLI will have high growth rate?


Agree 20

Neutral 26

Disagree 14

Can’t say 40

2026

14

40

0

5

10

15

20

25

30

35

40

Agree Neutral Disagree Can’t say

No. of respondents

No. of respondents

70

Interpretation: 20 people are saying that BSLI will grow in future, 26 are saying it will

be neutral, 40 can’t say, and 14 are disagree.

71

Findings

90 people saying that investment in insurance sector is good option and 10 are

saying no.

40 people have BSLI policies and 60 have of LIC.

10 people of BSLI have Whole life plan, 4 have retirement plan, 22 have children

plan, 4 have health plan.

56 people are saying that investment in LIC is better than BSLI, 44 are saying

investment in BSLI is better.

Most of the people of both LIC and BSLI are getting rate of interest 8-12%

Most of the people have children plan of BSLI.

Most of the people invest due to high interest of the policy in BSLI

People have more faith in govt. Companies than the private.

14 people invest in LIC due to its brand loyalty.

26 people saying that BSLI growth will be neutral in near future.

72

SUGGESTIONS

1) Information regarding new product should be provided to the customers.

2) The company should find out the no. of people who are not having any of the

insurance plans through an intensive market research and motivate them to get insured.

3) At some level Company should provide information to the customers about the

charges of the policy.

4) Company should target each and every class of the society.

5) Charges should be low of the policies.

6) Annual premium should be reasonable.

7) BSLI Company should work in systematic way.

74

LIMITATIONS

Some of the respondents were not cooperative.

There are chances of biased information provided by the respondents.

As the sample size is small compared to the total population,

therefore there can’t be full accuracy.

The time was limited.

Area was limited.

76

Conclusion

Here in this study we see that people have more policies of LIC in comparison to BSLI.

People have more faith in govt. companies than private. So it is necessary for BSLI Co.

that it should give more attention to that points or that areas where it lacks for further

future growth. Insurance sector is very wide and co. can grow in future.

78

Bibliography

www.birlasunlife.com

www.licindia.com

www.google.com

Newspapers

80

ANNEXURE

NOTE: The information that you will provide will be kept confidential and will be

used only for academic Purpose.

Our questionnaire will be to those persons who have plans of BSLI or LIC.

GENERAL

Name

__________________________________________________________________

Addres_____________________________________________________________

____

Gender_________Age________ContactNo._______________________________

___

1. Do you think that investment in insurance sector is good option

(a) Yes (b) No

2. Which company’s policy do you have?

(a) Birla Sun Life Insurance (b) LIC

82

3. Which type of policy you have?

(a)Whole Life Plan (b) Retirement Plan (c) Children Plan (d) Health Plan

(e) Golden jubilee plan (f) any other please specify___________________

4. What percentage of interest you get from it?

(a) Below 5% (b) 5-8% (c) 8-12% (d) Above 12%

5. Why do you invest in this company?

(a) High interest (b) good image (c) Company growth

(d) Annual premium is reasonable (e) due to maturity benefits

(f) Any other please specify ______________________________

6. Do you think that investment in BSLI is better than LIC?

(a) Yes (b) No

( If your answer is no then jump to question no. 8)

7. if yes then why?

(a) Because BSLI gives guaranteed fund value at maturity time

(b) Growth rate of company is high (c) BSLI has more ULIP plans than LIC

(d) Risk factor is covered properly (e) all above

(f) Any other (please specify)_____________

8. If no then why?

(a) Because LIC is having government stake. (b) Brand loyalty of LIC

83

(c) It has low premium plans than BSLI (d) Investment return is higher than

BSLI

(e) Any other (please specify)__________________________

9. Whenever company launch new product, then any information is given to you about

that product?

(a) Yes (b) No

10. In near future BSLI is having high growth rate.

(a) Agree (b) neutral (c) disagree (d) can’t say

Any suggestions __________________________________________________

THANKS

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comparision between birla sunlife and lic

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