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PROJECT REPORT
SUBMITTED THE PARTIAL FULFILLMENT OF
THE B.B.A. DEGREE
ON
RECRUITMENT OF FINANCIAL CONSULTANT
SESSION-2008-2009
Submitted to: Submitted by:
University of Rajasthan Avdesh Kumar Gurjar Gaur
B.B.A. Final Year
MAHARISHI ARVIND INSTITUTE OF
SCIENCE AND MANAGEMENT, JAIPUR
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PREFACE
Theories are being developed, designed and stated on the
groundwork of their practical implementation and usage. Work
experience seems to be the most effective and indispensable factor of
making an individual an adept. This is because one can not do
without being exposed to varying circumstances and possible
consequences. Training not only develops individual skills and
abilities but also provides proficiency in work performance.
This report served as a means to share my personal experiences while
working on this project which provided me the platform where I was
face to face with practical aspects of theoretical knowledge gained so
far.
This training project report has been prepared during the summer
training of 45 working days in an organization. It is an integral part
of MBA curriculum. The summer training was challenging, gainful
and interesting and it gave real insight of corporate world.
I sincerely believe that there is no better place to learn the practical
side of management studies than the industry itself.
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ACKNOWLEDGEMENT
The project report prepared by us though bears our name alone but isactually a collective effort. I am indeed indebted to a lot of people
and their names surely deserve to be mentioned.
I feel immense pleasure in conveying my heartiest thanks and deep
sense of gratitude to Mr. Amit Pandey, Branch Manager HDFC
Standard Life Insurance Company Ltd. Jaipur-IV, for giving me an
opportunity to work on the project.
I offer my sincere thanks to Mr. Ravi Sharma, Sales Development
Manager HDFCSLIC Ltd. Jaipur-IV, for their regular guidance in the
project and to sharpen my rough edges from time to time.
I would like to particularly mention my deep gratitude to Prof.
Satish Agarwal, Head of Department (Department of management
studies) and Dr. Shiv Prasad (Training and Placement officer)
Management Studies giving their consent and blessings to undertake
this training.
(NAVEEN SHARMA)
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CONTENTS
1. Introduction
2. Company Profile
3. Vision and Values of the Company
4. Branch Profile
5. Products of HDFCSLIC Ltd.
6. SWOT Analysis
7. Findings and Suggestions
8. Questionnaire
9. Conclusion
10. Bibliography
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INTRODUCTION
Introduction to Insurance
Every asset has a value for its owner and also for those who are
benefited with the existence of that asset. Insurance is concerned with
the protection of economic value of assets.
Every asset has normally an expected lifetime. During this period, it
is expected to perform and provide income/comfort to the owner.
The owner, being aware of this, plans the things in such a way that
by the time the expected lifetime of the asset expires, he is ready with
the funds required for its replacement. In this way, he ensures that
the value or income from the asset is not lost. Well, this appears to be
a fine arrangement provided the asset completes its expected lifetime!
All assets carry the risk of being destroyed or damaged. But all assets
may not necessarily get destroyed or damaged. Only in a few
instances, the probability turns out to be true and the asset gets
actually lost or destroyed by accident or some other unfortunate
event before the completion of its expected lifetime. The owner andthose deriving benefits from the asset will suffer because the
arrangement to make available its substitute is not yet ready.
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Insurance is helpful in mitigating such adverse consequences. To sum
up, assets are insured, as they are likely to be lost or made non-
functional through an accidental occurrence.
Insurance does not protect the assets. This means that insurance
cannot prevent loss to the assets due to perils. Nor can insurance
avoid the occurrence of the perils. It only compensates, may not be
fully, the economic or financial loss resulting to the asset from such
damage or destruction.
History of Insurance
The beginning of insurance business is traced to the city of London. It
started with the marine business. Marine traders, who used to gather
at Lloyds coffee house in London, agreed to share losses to goods
during transportation by ship. Marine related losses included:-
Loss of ship by sinking due to bad weather in high seas.Goods in transit by ship robbed by sea pirates. Loss of or damage to the goods in transit by ship due to
bad weather in high seas. The first insurance policy was
issued in England in 1583.
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Life Insurance in India
In India, insurance started with life Insurance. It was in the early 19 th
Century when the Britishers on their postings in India felt the need of
life insurance cover.
It started with English Companies like... The European and the
Albert. The First Indian insurance company was the Bombay Mutual
Assurance Society Ltd., formed in 1870.
In the wake of the Swadeshi Movement in India in the early 1900s,
quite a good number of Indian companies were formed in various
parts of the country to transact insurance business. To name a few::
Hindustan Co-operative and National Insurance in Kolkata; United
India in Chennai; Bombay Life, New India and Jupiter in Mumbai
and Lakshmi Insurance in New Delhi.
Nationalisation of Life Insurance in India
In 1956, life insurance business was nationalized and LIC of India
came into being on 1.9.1956. The government took over the business
of 245 companies (including 75 provident fund societies) who weretransacting life insurance business at that time. Thereafter, LIC got
the exclusive privilege to transact life insurance business in India
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Purpose and Need for Insurance
y Assets are likely to be destroyed or made non-functional due toaccidental occurrences called perils. Assets can, therefore, be
insured. A few examples of perils are: fire, floods, breakdowns,
lightning, earthquake etc. Perils are the events. Risks are the
consequential losses or damages.
y Possibility of damage to asset caused by any peril is the riskthat asset is exposed to.
y Risk means uncertainty or unpredictability about future loss ordamage, which may or may not happen. This refers to the
losses, which may happen suddenly and unexpectedly.
y We can say that a human life is also an income-generating asset.y Human life may be lost due to unexpected early death or
become non-functional following sickness or disabilities causeby accidents.
y If this happens by the time one is on the verge of retirementwhen his income is about to cease, he might have made
alternative arrangements to meet his needs.
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Types of Insurance
Basically there are two types of Insurances:
1. Non-Life Insurance 2. Life Insurance
Basically Non-Life Insurance Includes:-
Marine Insurance
Fire Insurance Miscellaneous Insurance
VehiclesFurnitureBuildingAircraftsGeneral
Life Insurance Includes:-
Only Human Life Insurance Human beings sickness, illness Long term concept
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COMPANY PROFILE
The HDFC Group
HDFC was incorporated in 1977 with two primary objectives - to
enhance housing stock in the country through housing finance
systematically and professionally and promote home ownership.
Today they are the largest residential mortgage finance institution in
India, with a net worth of Rs. 2,703 crores as of March 31, 2002 and anasset base of over Rs. 22,000 crores. HDFC also aim to increase the
flow of resources to the housing sector by integrating the housing
finance sector with the overall domestic financial markets.
HDFC has demonstrated the viability of market oriented housing
finance in a developing country. The World Bank considers us a
model private sector housing finance company in developing
countries and a provider of technical assistance for new and existing
institutions, in India and abroad.
HDFC is also the largest mobiliser of retail deposits in the private
sector outside the banking circle. Their deposits have been awarded
the highest safety credit rating 'FAAA' & MAAA by CRISIL and
ICRA respectively for eight consecutive years.
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While being a household name in India and the undisputed market
leader in the fields of housing finance, their social responsibilities
have remained in focus.
GROUP COMPANIES OF HDFC
HDFC Bank Limited
HDFC Securities Limited
HDFC Asset Management Company Limited
HDFC Realty Ltd.HDFC Deposits
HDFC Standard Life InsuranceHDFC Chubb
Intelenet
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HDFC Bank Ltd.
The Housing Development Finance Corporation Limited (HDFC)
was amongst the first to receive approval from the Reserve Bank of
India (RBI) to set up a bank in the private sector. The bank was
incorporated in August 1994 in the name of HDFC Bank Limited,
with its registered office in Mumbai. HDFC Bank commenced
operations as a Scheduled Commercial Bank in January 1995.
Awards
Best Listed Bank of India by Businessworld. Best Domestic Bank by The Asset Magazines Triple A Country
Award.
Best Local Cash Management Bank2006 in Large andMedium segmentsAsiamoney Awards
Best Bank in India in 2006Euromoney Awards
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HDFC Asset Management Company Ltd.
HDFC Asset Management Company Ltd. (AMC) was incorporated
under the Companies Act, 1956; on December 10, 1999 and was
approved to act as an Asset Management Company for the HDFC
Mutual Fund by SEBI vide its letter dated June 30, 2000.HDFC Asset
Management Company Ltd. (AMC) is one of the most growing
Mutual Fund Company of India.
Awards
HDFC mutual fund was recently awarded the CNBC Moddysinvestor service award for the best performing fund house for
the one year category.
Zurich also received the best performing fund house award forthe three year category.
HDFC Chubb
Its partnership that leverages the strengths of two financial
powerhousescombining the trust and local experience of HDFC,
Indias premier financial services company, with the 120 years
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proven expertise of CHUBB, a global leader in non-life insurance
backed by a network of 134 offices in 31 countries.
Chubb today provides property and casualty insurance through
more than 10,000 employees in 32 countries of North America, South
America and Asia.
Intelenet
Intelenet is a leading BPO service provider with the focus on
providing solutions to global Organizations seeking to reduce the
cost while consistently maintaining superior level of standards two
leading global investorsHDFC and Barclays--provide the financial
banking Intelenet needs to lead in a global marketplace. Barclays is a
venerable financial services group headquartered in the United
Kingdom, ranking amongst the services group headquartered in the
United Kingdom, ranking among the Top 10 banks in the world
based on market capitalization.
Intelenet impacts your business by seeking to reduce costs while
consistently maintaining superior levels of service. Our solutions
extend across all strata of BPO, technology and consulting.
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Awards
Deloitte Technology Fast 50 India 2005 ProgramIntelenet Global Services has been ranked first among BPOs
while standing third overall in the Technology, Media and
Telecommunications (TMT) sectors across India.
Deloitte Technology Fast 50 India 2006 ProgramIntelenet Global Services has continued its ranking, second
time in a row, as amongst the top 50 fast growing technology
companies in India.
Maharashtra Information Technology Awards 2005Intelenet Global Services came in a close second in the IT
Enabled Services category at the Maharashtra Information
Technology Awards2005.
HDFC Deposits
D E P O S I T S
HDFC has instituted well-defined service standards for bothdepositors and deposit agents. HDFC has been able to mobilize
deposits from over 10 lac depositors. Outstanding deposits grew
from Rs. 1,458 crores in March 1994 to Rs. 8,741 crores in March 2006.
Much of this success can be attributed to its strong brand image,
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superior services, security and above all, the significant contribution
made by HDFCs deposit agents. HDFC has over 50,000 deposit
agents and distributes all its retail savings (deposit) products
primarily through this channel.
Awards
HDFC has been awarded AAA rating and MAAA ratingfor its deposits from both CRISIL and ICRA for the twelfth
consecutive year, representing highest safety as regards timely
payment of principal and interest.
HDFC Realty Ltd.
Realty Limited
HDFC Realty Ltd. Is a new, organized electronic marketplace for
properties, to provide the entire gamut of real estate services,
bringing together the click world and the bricks world in a
revolutionary and user-friendly way. Making available the best
guidance and the most professional, transparent, efficient service to
the real estate customer.
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HDFC Securities Ltd.
S E C U R I T I E S
HDFC Securities Ltd was promoted by the HDFC Bank & HDFC
with the objective of providing the diverse customer base of the
HDFC Group and other investors, a capability to transact in the Stock
Exchanges & other financial market transactions.
HDFC Standard Life Insurance Company Ltd.
HDFC Standard Life Insurance Company Ltd. is one of India's
leading private insurance companies, which offers a range ofindividual and group insurance solutions. It is a joint venture
between Housing Development Finance Corporation Limited (HDFC
Ltd.), India's leading housing finance institution and a Group
Company of the Standard Life, UK, and leading providers of
financial services in the United Kingdom. HDFC as on March 31,
2007 holds 81.9 per cent of equity and Standard Life was holding 18.1
in the joint venture.
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Highlights
First life insurance Company in the private sector to get licensefrom the regulator IRDA.
First life insurance Company to come out with Term AssurancePlan.
First private life insurance Company to declare bonusesconsecutively for 6 years from inception.
First life insurance Company to introduce open option to thepension plan policyholders.
First life insurance Company to introduce Automatic AllocationOption to all the policyholders under Unit Linked Plans.
Only life insurance Company to give 24 free switching optionto Unit Linked Policyholders.
HDFC is one of the fastest growing Private Life Insurers andtoday have more than 8 lakh policyholders.
HDFC have one of the widest networks with more than 160branches and servicing over 440 towns.
HDFC Standard Life Insurance Company has one of the highestbrand recalls of around 86%. (Source: AC Neilson ORG MARG,
September 2005). A high brand recall translates to higher
chances of customers buying insurance from them.
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Awards
Over a decade of its operations, HDFC Standard Life Insurance
Company Ltd. has been recognized, rated and awarded by a number
of organizations, which include:
Winner of the Out Look Money Award for two consecutiveyears.
Voted as the Most Respected Life Insurance Company byBusiness World in 2004.
HDFCs KEY STRENGTHS
Financial Expertise
As a joint venture of leading financial services groups, HDFC
Standard Life has the financial expertise required to manage your
long-term investments safely and efficiently.
Range of Solutions
We have a range of individual and group solutions, which can be
easily customized to specific needs. Our group solutions have been
designed to offer you complete flexibility combined with a low
charging structure.
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Track Record so far
Our cumulative premium income, including the first year premiums
and renewal premiums is Rs. 1532.21 Crores Apr-Mar 2005 - 06.We have covered over 1.6 million individuals out of which over
5,00,000 lives have been covered through our group business tie-ups.
VISION & VALUES
Our Vision
The most successful and admired LifeInsurance Company, which means that we aremost trusted company, the easiest to deal with,offers the best value for money, and set thestandards in the industry. In short, The mostobvious choice for all.
Values
IntegrityInnovation
Customer CentricPeople CareTeam Work
Joy & Simplicity
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BRANCH PROFILE OF HDFCSLIC, TONK ROAD
HDFC Standard Life Insurance Companys branch at Tonk Road,
Jaipur was started in October 2006. It was started with the aim to
provide best of Insurance services with the core values of Integrity
and Customer Centric Behavior.
HDFCSLIC Ltd. Tonk Road, Jaipur has excelled in all its services. It
offers almost all products of the Company. Some of them are saving
plans, pension plans, various investment plans etc.
It has a well-planned organization structure. This branch is
integrated by 4 branches, Jaipur-III, Jaipur-IV, Jaipur-V and Jaipur-IX.
All the branches headed by Territory Manager Mr. Sumeet Chugh
and Branch ManagersMr. Siddarth Singh (Jaipur-III),Mr. Rajesh Gupta
(Jaipur-IV), Mr.Utkarsh Upadyaya (Jaipur-V), Mr. Chardra Shekhar
Paliwal (Jaipur-IX), and other staff members working in various
departments and dealing in each of the products.
Under each Branch Manager there are around 8-12 Sales
Development Managers (SDM), who takes the responsibility of
promoting and selling of HDFCSLICs products.
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P.I.P.S.
Classification of life insurance plans
Lifeinsurance plans can be classified into the following four
categories according to the
Features:
Protection Plans
Investment Plans
Pension Plans
Savings Plans
Protection Plans
As the name suggests this category of plans are designed to protect
the income earning capacity of the life assured. The present income of
the life assured therefore forms the basis of the life insurance. A
person with no income therefore cannot be given this plan. The plan
is therefore not offered to students, housewives and minors.
The plans are in the nature of assurances rather than pure insurance.
Under the plan the insurance company assures the policyholder that
a lump sum of money would be paid on the happening of the insured
event. Thus even if the life assured does not earn the same level of
income at the time of the happening of the insured event, as at the
time when he took the insurance, the lump sum is still payable.
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The premium collected under this category of plans is generally
sufficient to cover the risk insured. There is no return of premium on
the expiry of the cover; however a saving element can be built under
the plans to return the savings amount at maturity. The plans do not
share in the profits of the company and have no bonuses.
The risk is common to the poll of policyholders who by purchasing
the plan choose to share the risk with group. The claims are paid
from the contributions made by the policyholders. The premium paid
by the policyholder is sufficient to cover the risk and expenses, hence
generally on the expiry of the cover nothing is payable.
Under the protection plans the risk is covered for a premium, which
is sufficient to pay the claims and the expenses. It is therefore
necessary for the insurance company to ensure that the claims do not
exceed the assumed mortality. To ensure this, the insurance company
would strictly underwrite the protection plans. There is also a stiff
competition under the protection plans as the plans of two companies
can be compared on the basis of the premium charged. Every
company tries to get the share of the market by keeping the premium
under this category lower. The only way for a company to keep the
premium low over a long period is to control the expenses and
claims. The service factor is also important while selling a protection
plan. How quickly the claim would be settled matters. In case a
company is charging some few rupees more but is known for quick
settlement of the claim the client would not mind going with such
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company. Hence the premium rate as well as the service should be
explained to the client while selling the protection plans.
The plan should be sold on the basis of the Human Life Value (HLV)
concept. As per the HLV concept every individual has an economic
value, which is equal to the present value of all future earnings of
that individual. Company should sell this plan to clients who have an
income and a financial responsibility. This form of insurance is also
called a young persons privilege as it is easy to get this insurance
when you are young and since savings are low when a person is
young he should possess this cover in case of an unforeseen event.
Rider Benefits also fall in this category of plans. Under the rider the
insured event is defined and claims are payable only if the insured
event as defined occurs. Rider benefits usually come with a number
of exclusions. One should understand the exclusions and the
definitions of the rider benefit before choosing a rider.
HDFC Standard Life Company has two products in this category and
they are:
1. Term Assurance Plan2. Loan Cover Term Assurance Plan
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Investment Plan
As the name suggests this category of plans are designed to help the
person reduce some of the risk of investments. All the investment
risks cannot be reduced. What the investment plans try to do is to
create a pool of investors so that they can get the advantage of large
funds, diversified investments, professional management and better
returns. Investment plans can be designed to protect the policyholder
against the market fluctuations. However all policyholders cannot be
protected at the same time against market fluctuations. It is common
to allow the protection to a small group of policyholders at any given
point of time. One of the objectives of the investment type of plans is
to give a good return to the policyholder.
When risk covers are integrated with the investment plans the cost ofthe risk covers reduce the returns to the policyholders. To avoid the
risk cover costs the plans do not offer huge risk covers. Hence in
these type of plans, premium paid by policyholder is almost equal to
the sum assured.
The premium under the plans mainly consists of investment. It
would not be correct to compare this category of plans on the basis of
the sum assured and the premium paid. In case a higher premium is
collected under the plan, the company would be in a better position
to pay a bigger amount on maturity/death. A better way of
comparison would be to compare what the client pays and what he
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would get under the plans. At the time of selling unfortunately you
would not be able to show to the client as to what he would get
under his plan. Illustrations and past bonuses are something you can
use to convince the client. The company background and the
philosophy of the company can also be used to convince the client.
Life insurance investment plans are designed for long-term
investments. It is not cost effective for a life insurance company to
design a short-term investment plan. It is therefore usual for these
types of plans to have a term of 10 years and above. It is important to
make the client understand that he is entering into a long-term
investment when he purchases and investment plan form a life
insurance company.
This plan is useful when the client is looking for investment for a
long term financial needs which requires investment of money for a
long term.
The investment plan can be designed as a with-profits contract or a
unit linked contract. In a with profits contract the returns are
smoothened while under the unit linked contract the returns to the
client depend on the movement of the Net Asset Values (NAVs) of
the units purchased.
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Pension Plans
Pension Plans are designed to provide pension. With the interest
rates fluctuating and the increase in longevity the interest in thepension products has been growing in the recent past. Life pensions
provide an income till death and this is attractive in the above
mentioned scenario.
The Indian society has been moving from the joint family system to
the nuclear family system. There is also no form of social security
schemes, which provide an income in the old age. It is therefore
important that all individuals think about their retirement and save
for an income in the old age. Pension Plans help the client to build the
pension fund, which is earmarked, to provide for the pensions and
pay the pensions on the chosen retirement date.
Pension Plans can be further classified into the following two
categories:
1. Deferred Pension Plans These plans help the client build thepension fund during his earning years and convert the fund
into pensions on the chosen retirement date.
2. Immediate Pension Plans These plans pay a pensionimmediately after the lump sum purchase price is paid to the
insurance company.
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The deferred pension plan has two parts. In the first part the savings
of the policyholder is accumulated to create a fund for the purchase
of a pension on the chosen date. This accumulation can be offered
through a with-profits fund or through the unit linked mechanism.
In the second part the fund is used to purchase an annuity chosen by
the policyholder. There are various immediate annuities, which are
available and the client should choose one, which suits him the best.
The choice of the annuities is therefore given to the client just before
the annuity starts.
The aim of a deferred pension plan is to provide a good annuity to
the client. Risk covers are therefore not built in the plan. This is to
ensure that the cost of the risk cover does not reduce the amount
available for pension.
The deferred pension plan works like a savings plans with the
difference that the amount at the end of the contract is paid in the
form of pension. In the event of death before the pension starts the
premium is returned with interest.
HDFC Standard Life launched the following plans in this category:
1. Personal Pension Plan (with profits)2. Unit Linked Pension Plan
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Savings Plans
The savings plans are designed to help a person save for a long-term
event. Long-term savings have inherent un-certainties. Besides long
term savings instrument are not available in the market. The savings
plans aims to provide a solution to the client in this area with the
benefit of life insurance.
It is important to note that the insurance cover offered is on the
savings. While purchasing the plan that the policyholder has a
savings target in mind. The plan aims to protect this target in the
event of the death of the life assured. In the event of the death of the
life assured during the term, in addition to the amount saved the
amount, which could not be saved is also paid to the beneficiary.
The premium paid by the policyholder consists of the savings. The
risk cover cost on the savings forms a very small portion of the
premium. The effectively means that the premium paid by the
policyholder would determine the maturity amount that the
policyholder would ultimately get. Thus comparison on the savings
products of two companies, on the premium and the sum assured is a
wrong method of comparison.
Savings plans offer the clients a good vehicle to build savings for a
long-term financial need. The earlier the client starts a savings plan
the lesser he would have to contribute as his savings would grow
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bigger due to the effect of compound interest. To sell a savings plans
you need to identify the long term savings needs of the client and
explain to him the benefits of savings through life insurance.
Savings plans have a risk element, which needs to be underwritten to
ensure that the death claims are controlled. In case a company is very
liberal in granting the covers the chances are that the policyholders
who survive would get a lower maturity benefits. Maturity benefits
can be enhanced by a strict control on the claims and the expenses.
Savings Plans can be offered as a with-profits plan or a unit linked
plan. A with profits fund aims to smoothen the returns to the
policyholder using the bonus mechanism while the returns to the
policyholder under a unit linked plan depends on the movement of
the unit prices.
HDFC Standard Life offers the following savings plans:
1.Endowment Assurance Plan (with profits)2.Money Back Plans (with profits)3.Childrens Plan (with profits)4.Unit Linked Endowment Plan
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PRODUCTS: AT A GLANCE
1.Endowment Assurance PlanSavings for a better tomorrow
Introduction
The Endowment Assurance Plan is a with profits savings contract
which aims to give good maturity values to the client by investing
the funds as per the IRDA guidelines and reducing claims and costs.
The aim of the plan is to pay good maturity values so that the savings
objectives of the policyholders are met.
Need for the Plan
The Endowment Assurance Plan is designed to provide a solution to
the long term financial needs. It is often felt that people save only
when their income is more than their expenses. To put it bluntly if a
person can earn more than what he can spend he can save. In reality
this is not the situation as one finds that it is impossible to save with
the current level of expenses. Why does this happen?
Expenses are a function of our needs, which arise due to our wants.
We all know that the wants of a human being are unlimited.
Consequently the needs keep on increasing and often increase at a
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rate higher than the rate of growth of income. Income on the other
hand is limited and often grows at a much lower rate than the needs.
Consequently it is difficult to save.
There are various savings options available in the market; however
most of the options are short-term or medium term. Life Insurance
savings plans are a better choice as in addition to providing the
vehicle to save for long term the plans also offer insurance on the
savings. Income does not increase with every requirement for
finance. Childrens education, marriage, housing etc. require lump
sum amounts. In case any person has a responsibility to spend on
these kinds of long-term events, he would have a need for the
product.
Features of the Endowment Assurance Plan
The following are the features of the plan:
1.Benefits:a) Death Benefits: In the event of death of the life assured
during the term of the contract, and provided all the
premiums are paid till the time of the death of the life
assured, the sum assured, together with reversionary
bonus and the terminal bonuses (if any) would be paid to
the beneficiary. The policy would terminate on payment
of the death benefit.
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b)Maturity Benefits: On survival of the life assured till the
date of maturity, and subject payment of all premiums,
the policyholder would be paid the sum assured, together
with the reversionary bonuses and terminal bonus (if
any). The policy would terminate on payment of the
maturity benefit.
c) Paid-up Benefits: In case the policyholder discontinuespayment of premium after the premiums are paid for at
least three years, the policy would be reduced to a paid-
up policy. The reduced paid-up benefits are payable on
death of the life assured during the term, or survival of he
life assured till the date of maturity, whichever is earlier.
d)Surrender Benefits: The policyholder can surrender thepolicy at any time. In case the policyholder chooses to
surrender the policy before the payment of three years
premium the surrender value would be equal to zero and
nothing would be payable. In case the policyholder
chooses to surrender after three years, he would be
entitled for a surrender value.
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2.Frequency of premium payment:
The policyholder can choose yearly, half-yearly or quarterly
mode of payment, as he desire. The frequency of premiumpayment can be altered during the term of the contract.
3.Days of grace:The premium is payable in advance and should be paid within
the days of grace. The days of grace allowed under the plan are
15 days from the due date of premium. In case the days of grace
end on a holiday then the premium has to be paid on the next
working day.
4.Lapsation:In the event the premium is not paid within the days of grace
the policy lapses. The policy would be automatically reduced to
a paid up policy in case premiums have been paid for at least
three years. In case premiums are not paid for three years the
policy would lapse without value.
A lapsed policy can be reinstated within one year from the date
of lapse only.
5.Minimum premium:The following are the minimum premium conditions under the
Endowment Assurance Plan.
Annual mode Rs. 1800
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Half yearly mode Rs. 1000
Quarterly mode Rs. 550
There is no condition of maximum premium.
6.Other conditions:Minimum Term 10 years
Maximum Term 30 years
Minimum Age at Entry 12 years
Maximum Age at Entry 60 years
Maximum Maturity Age 75 years
The policyholder has the choice to choose any term between 10
to 30 years, subject to the maximum maturity age. In case the
policy is taken on the life of a minor then the legal guardian of
the minor would have to propose the insurance on behalf of the
minor. The policy would automatically vest in the life assured
when he attains the age of majority.
7.Policy loans:Policy loans would be available under the plan once the policy
acquires a surrender value. The policy loans would be to the
extent of 90% of the surrender value. The company would
quote the terms and conditions of the policy loans at the time of
granting the loans and the same would vary from time to time.
8.Life cover basis:
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The endowment assurance plan can be offered on a single life
basis or as joint life first claim basis. When the policy is offered
on a joint life basis the death claim would be paid on the death
of any one of the lives assured and the policy would terminate.
9.Tax benefits:The premium paid under the plan qualifies for tax rebate under
section 88 of the Income Tax Act 1961. The claim benefits would
also not be taxable as per section 1010 D of the Income Tax Act
1961.
The plan is also approved under the provisions of section 80
DD of the Income Tax Act 1961.
Positioning of the Endowment Assurance Plan
The Endowment Assurance Plan can be positioned as along term
savings vehicle with a cover on the savings. The plan is suited to help
in building a fund for long term financial needs. The guarantees in
the nature of sum assured and the bonuses assure the client of a
smoothened long-term return. The philosophy and practices of the
company can help in building the maturity values for the client and
hence positioning the company is also important in the sale of the
Endowment Assurance Plan.
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2. Money Back PlanPlan with periodic survival benefits
Introduction
The Money Back Plan is a with profits savings contract which in
addition to the payment of periodic survival benefits aims to give
good maturity values to the client by investing of funds as per the
IRDA guidelines and reducing claims and costs. The aim of the plan
is to pay periodic survival benefits and build good maturity values so
that the short term, medium term and long-term savings objectives of
the policyholders are met.
The net returns to the policyholders at the time of maturity would
depend on the investment and cost experience during the term of the
contract.
Need for the Plan
The Money Back Plan is designed to provide a solution for the short-
term, medium term and long term financial needs. It is therefore
important to understand the financial needs before suggesting theplan as a solution.
Since people have some short term and medium term and medium
term financial goals like providing for a vacation, purchasing of a
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luxury item or house renovations etc, they require money
periodically in short intervals to meet these goals.
The Money Back Plan is designed to provide money periodically so
that the same can be used for such requirements. The added
advantage of the Money Back Plan is that the risk cover keeps on
adjusting during the term of the contract and the policyholder is
assured payment of the full sum assured together with the bonuses
irrespective of the survival benefits paid on death of the life assured
during the term.
Features of the Money Back Plan
The following are the features of the plan:
1.Benefits:a. Death Benefits: In the event of death of the life assured
during the term of the contract, and provided all the
premiums are paid till the time of the death of the life
assured, the sum assured, together with reversionary
bonus and the terminal bonuses (if any) would be paid tothe beneficiary.
b. Survival Benefits: Survival benefits are paid at the end ofevery fifth year on survival of the life assured. The rates
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of survival benefits are given below. The policy would
continue after payment of the survival benefit.
c. Sur
v
c. Maturity Benefits: On survival of the life assured till thedate of maturity, and subject payment of all premiums,
the policyholder would be paid the sum assured, together
with the reversionary bonuses and terminal bonus (ifany) less all survival benefits paid during the term of the
contract. The policy would terminate on payment of the
maturity benefit.
d. Paid-up Benefits: In case the policyholder discontinuespayment of premium after the premiums are paid for at
least three years, the policy would be reduced to a paid-
up policy. The reduced paid-up benefits are payable on
death of the life assured during the term.
Number of years from the policy commencement date
Policy
Term 5 10 15 20 25
10 40%
15 30% 30%
20 25% 25% 25%
25 20% 20% 20% 20%
30 15% 15% 15% 15% 15%
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e.Surrender Benefits: The policyholder can surrender the
policy at any time. In case the policyholder chooses to
surrender the policy before the payment of three yearspremium the surrender value would be equal to zero and
nothing would be payable.
2.Frequency of premium payment:The policyholder can choose yearly, half-yearly or quarterly
mode of payment, as he desire. The frequency of premium
payment can be altered during the term of the contract.
3.Days of grace:The premium is payable in advance and should be paid within
the days of grace. The days of grace allowed under the plan are15 days from the due date of premium. In case the days of grace
end on a holiday then the premium has to be paid on the next
working day.
4.Lapsation:In the event the premium is not paid within the days of gracethe policy lapses. The policy would be automatically reduced to
a paid up policy in case premiums have been paid for at least
three years. In case premiums are not paid for three years the
policy would lapse without value.
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A lapsed policy can be reinstated within one year from the date
of lapse only.
5.Minimum premium:The following are the minimum premium conditions under the
Money Back Plan.
Annual mode Rs. 1800
Half yearly mode Rs. 1000
Quarterly mode Rs. 550
There is no condition of maximum premium.
6.Other conditions:Minimum Term 10 years
Maximum Term 30 years
Minimum Age at Entry 12 years
Maximum Age at Entry 60 years
Maximum Maturity Age 75 years
The policyholder has the choice to choose any term between 10
to 30 years, subject to the maximum maturity age. In case the
policy is taken on the life of a minor then the legal guardian of
the minor would have to propose the insurance on behalf of the
minor. The policy would automatically vest in the life assured
when he attains the age of majority.
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7.Policy loans:
Policy loans would be available under the plan once the policy
acquires a surrender value. The policy loans would be to theextent of 90% of the surrender value. The company would
quote the terms and conditions of the policy loans at the time of
granting the loans and the same would vary from time to time.
8.Life cover basis:The Money Back Plan can be offered on a single life basis or as
joint life first claim basis. When the policy is offered on a joint
life basis the death claim would be paid on the death of any one
of the lives assured and the policy would terminate.
9.Tax benefits:The premium paid under the plan qualifies for tax rebate under
section 88 of the Income Tax Act 1961. The claim benefits would
also not be taxable as per section 1010 D of the Income Tax Act
1961.
The plan is also approved under the provisions of section 80
DD of the Income Tax Act 1961.
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3. Childrens Plan
Plan designed for the benefit of children
Introduction
The Childrens Plan is a with-profits savings contract designed for
the benefit of the child. The plan therefore has a provision for a
beneficiary, which can be the child, and all benefits under the plan
would be paid to the child. The funds generated under the plan are
invested as per the IRDA guidelines.
The net returns would depend on our investment and cost experience
during the term of the contract
Need for the Plan
Most parents feel that it is their responsibility to provide the best for
their children. In addition to the physical and emotional wants
children also need to be provided for financially. There are two types
of financial needs of the child:
I. Short term financial needs for food, clothing shelter andeducation. This need is mostly met from the income of the
parent
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II. Long term financial need for higher education, marriage
and start in life. The alternatives for this are either to save
or raise loans.
In the event of an early death of the parent the child become
dependent of one of the close relative. To ensure that the child would
be taken care even after such an eventuality the parent can look at
providing an income as well as lump sum amounts for the benefit of
the child. The Childrens Plan is designed to help the parent in
planning for the above financial needs of the child.
All the arguments on the need to save and savings being a better
option than raising a loan are applicable while selling the Childrens
Plan.
Features of the Childrens Plan
The following are the features of the plan:
1. Benefits:
a) Death Benefit: Under this option on death of the lifeassured during the term of the policy, provided the
premium is paid till the date of death; no amount would
be immediately payable. The future premiums would be
waived and at maturity date of the policy the full sum
assured with the reversionary bonuses and terminal
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bonus (if any) would be payable to the beneficiary. The
policy would participate in the bonuses till the date of
maturity. The policy would terminate on the payment to
beneficiary.
b)Accelerated Benefit: Under this option on death of the lifeassured during the tem of the policy, provided the
premium is paid till the date of death, the sum assured
with the reversionary bonus and terminal bonus (if any)
would be payable immediately to the beneficiary and the
policy would terminate.
c) Double Benefits: Under this option on death of the lifeassured during the term of the policy, provided the
premium is paid till the date of death; one sum assured
would be paid to the beneficiary immediately. The future
premiums would be waived and at maturity date of the
policy the full sum assured with the reversionary bonus
and terminal bonus (if any) would be payable to the
beneficiary. The policy would terminate on payment of
the benefit on the date of maturity
d)Maturity Benefits: In the event of survival of the lifeassured during the term of the contract, and provided all
the premiums are paid, the sum assured, together with
the reversionary bonuses and the terminal bonuses (if
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any) would be paid to the beneficiary. The policy would
terminate on payment of the maturity benefit.
e) Paid-up Benefits: In case the policyholder discontinuespayment of premium after the premiums are paid for at
least three years, the policy would be reduced to a paid-
up policy. If the Childrens Plan is made paid up, a table
of adjustment factors will be used to adjust the policys
basic sum assured to a paid up value. The adjustment
factors will vary by the policyholders age, the policys
original term, policy duration, and frequency.
f) Surrender Benefits: The policyholder can surrender thepolicy at any time. In case the policyholder chooses to
surrender the policy before the payment of three years
premium the surrender value would be equal to zero and
nothing would be payable. In case the policyholder
chooses to surrender after three years, he would be
entitled for a surrender value.
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2.Frequency of premium payment:
The policyholder can choose yearly, half-yearly or quarterly
mode of payment, as he desire. The frequency of premium
payment can be altered during the term of the contract.
3.Days of grace:The premium is payable in advance and should be paid within
the days of grace. The days of grace allowed under the plan are
15 days from the due date of premium. In case the days of grace
end on a holiday then the premium has to be paid on the next
working day.
4.Lapsation:In the event the premium is not paid within the days of grace
the policy lapses. The policy would be automatically reduced to
a paid up policy in case premiums have been paid for at least
three years. In case premiums are not paid for three years the
policy would lapse without value.
A lapsed policy can be reinstated within one year from the date
of lapse only.
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5.Minimum premium:
The following are the minimum premium conditions under the
Childrens Plan.Annual mode Rs. 1800
Half yearly mode Rs. 1000
Quarterly mode Rs. 550
There is no condition of maximum premium.
6.Other conditions:
Minimum Term 10 years
Maximum Term 25 years
Minimum Age at Entry 18 years
Maximum Age at Entry 60 years
Maximum Maturity Age 75 years
The policyholder has the choice to choose any term between 10
to 25 years, subject to the maximum maturity age. In case the
policy is taken on the life of a minor then the legal guardian of
the minor would have to propose the insurance on behalf of the
minor.
7.Policy loans:Policy loans would not be available under the plan.
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8.Life cover basis:
The Childrens Plan is to be sold on the life of the parent with
the child as the beneficiary. The plan is not offered on a jointlife basis.
9.Tax benefits:The premium paid under the plan qualifies for tax rebate under
section 88 of the Income Tax Act 1961. The claim benefits would
also not be taxable as per section 1010 D of the Income Tax Act
1961.
The plan is also approved under the provisions of section 80
DD of the Income Tax Act 1961.
Positioning of the Childrens PlanThe Childrens Plan can be positioned as a long term savings vehicle
specially designed to meet the financial requirements of the child.
The plan provides for both the immediate financial needs and the
long term financial needs. In case the client is not worried about the
immediate financial needs of the child on his death then the maturity
benefit option would be suitable to him. The sum assured payable onthe death in a double benefit option would help in providing for the
immediate financial needs of the child. The Accelerated benefit works
exactly like and endowment assurance plan. The guardian of the
child would have an option of either to spend the money for the
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immediate benefit of the child or to save the claim amount for a
future benefit.
4.Term Assurance Plan
Protection of Income
Introduction
The Term Assurance Plan is a without profits protection contractdesigned to protect the income earning capacity of the life assured.
The present earning capacity of the client therefore forms the basis of
the insurance.
Need for the Plan
Uncertainty is a part of life. In the event of death of the breadwinner
the dependents are put to a lot of financial difficulty as they lose the
source of income. The problem is compounded in case the family
does not have savings to rely on. In case a person has dependents
and also does not have savings on which the family can rely on in the
event of his death, he needs to protect his income for the benefit of
the family. Term Assurance Plan is designed to offer the protection of
the income at the least possible cost.
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Term Assurance Plan can also be used to cover liabilities so that in
the event of death the family receives a lump sum amount so that
liabilities are paid off. Term Assurance is an insurance of income and
hence the existence of liabilities is not the basis of granting the
insurance.
Features of the Term Assurance Plan
The following are the features of the plan:
1. Benefits:
a) Death Benefits: Provided the policy is in force in the eventof death of the life assured during the term of the contract
the sum assured is paid.
b)Benefits on expiry of the cover: On expiry of the covernothing is payable as Term Assurance is designed for
protection only.
c) Paid up Benefits: There are no paid up benefits under thisplan.
d)Surrender Benefits: There are no surrender benefits underthis plan.
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2. Frequency of premium payment:
The policyholder can choose to pay by a single premium or
yearly, half-yearly or quarterly mode of payment. The
frequency of premium payment can be altered during the term
of the contract. Please note that a regular premium policy
cannot be changed to a single premium mode during the term
of the contract.
3. Days of grace:
The premium is payable in advance and should be paid within
the days of grace. The days of grace allowed under the plan are
15 days from the due date of premium.
4. Lapsation:
In the event the premium is not paid within the days of grace
the policy lapses. A lapsed policy can be reinstated within one
year from the date of lapse only.
5. Minimum premium:
The following are the minimum premium conditions under the
Term Assurance Plan.
Single Premium Rs. 2000
Annual mode Rs. 1500
Half yearly mode Rs. 800
Quarterly mode Rs. 450
There is no condition of maximum premium.
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6. Other conditions:
Regular Premium Single Premium
Minimum Term 5 years 2 years
Maximum Term 30 years 15 years
Minimum Age at Entry 18 years 18 years
Maximum Age at Entry 60 years 60 years
Maximum Maturity Age 65 years 65 years
7. Policy loans:Policy loans would not be available under the plan.
8. Life cover basis:
The Term Assurance Plan can be sold on a single life or joint
life first death basis.
9. Tax benefits:
The premium paid under the plan qualifies for tax rebate under
section 88 of the Income Tax Act 1961. The claim benefits would
also not be taxable as per section 1010 D of the Income Tax Act
1961.
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10.Special Rates for Women:
Since women have a lesser mortality rate than men for the same
age, the premium rate charged fro women would be the rateapplicable to men three years younger.
5. Loan Cover Term Assurance Plan
Protection of Loans
Introduction
The Loan Cover Term Assurance Plan is a without profits decreasing
cover protection contract designed to protect the outstanding loans of
the life assured. The plan is designed to cover loans however the plan
will be granted only in case the client has sufficient income to back
the insurance.
Need for the Plan
Uncertainty is a part of life. In the event of death of the breadwinner
the dependents are put to a lot of financial difficulty as they lose the
source of income. The problem is compounded in case there are
outstanding loans. The Loan Cover Term Assurance Plan is designed
to cover outstanding loans at the least possible cost.
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Features of the Loan Cover Term Assurance Plan
The following are the features of the plan:
1. Benefits:
a) Death Benefits: Provided the policy is in force in the event
of death of the life assured during the term of the contract
the sum assured is paid.b) Benefits on expiry of the cover: On expiry of the cover
nothing is payable as the Loan Cover Term Assurance is
designed for protection only.
c) Paid up Benefits: There are no paid up benefits under this
plan.
d) Surrender Benefits: There are no surrender benefits under
this plan.
2. Frequency of premium payment:
The policyholder can choose to pay by a single premium or
yearly, half-yearly or quarterly mode of payment. The
frequency of premium payment can be altered during the term
of the contract.
3. Days of grace:
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The premium is payable in advance and should be paid within
the days of grace. The days of grace allowed under the plan are
15 days from the due date of premium. In case the days of grace
end on a holiday then the premium has to be paid on the next
working day.
4. Lapsation:
In the event the premium is not paid within the days of grace
the policy lapses. A lapsed policy can be reinstated within one
year from the date of lapse only.
5. Minimum premium:
The following are the minimum premium conditions under the
Loan Cover Term Assurance Plan.
Single Premium Rs. 2000
Annual mode Rs. 1500
Half yearly mode Rs. 800
Quarterly mode Rs. 450
There is no condition of maximum premium.
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6. Other conditions:
Regular Premium Single Premium
Minimum Term 5 years 2 yearsMaximum Term 30 years 15 years
Minimum Age at Entry 18 years 18 years
Maximum Age at Entry 60 years 60 years
Maximum Maturity Age 65 years 65 years
7. Policy loans:Policy loans would not be available under the plan.
8. Life cover basis:
The Term Assurance Plan can be sold on a single life or joint
life first death basis.
9. Tax benefits:
The premium paid under the plan qualifies for tax rebate under
section 88 of the Income Tax Act 1961. The claim benefits would
also not be taxable as per section 1010 D of the Income Tax Act
1961.
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10.Special Rates for Women:
Since women have a lesser mortality rate than men for the same
age, the premium rate charged fro women would be the rateapplicable to men three years younger.
Important
Although the plan is named as Loan Cover Term Assurance Plan the
plan is basically a decreasing cover term assurance. The plan is not
linked to a loan and the client can choose to purchase this plan even
in case he does not have a loan. The sum assured would decrease at a
predetermined rate and is not linked to the decrease in the loan
amount. Care has been taken to ensure that the sum assured would
be sufficient to pay most of the loans. The plan does not guarantee
payment of the outstanding loan.
6. Single Premium Whole of Life Insurance
Plan
Plan designed to give long-term real growth
Introduction
The Single Premium Whole of Life Insurance Plan is a with profits
investment contract which aims to give long tem real growth to the
client by investing the funds as per the IRDA guidelines and
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reducing claims and costs. The aim of the plan is to generate long
term real growth, providing guarantees at specific times during the
term of the contract.
Need for the Plan
The Single Premium Whole of Life Insurance Plan is designed to help
the client in long-term investment. It is therefore important to
understand the problems associated with investments to sell the plan
better.
However all investment is associated with risk. The higher the risk
one takes, the better the chances of getting a better return. Investment
is all about taking risks.
Various investment instruments are available in the market and the
client has to choose from the investment option available. This
investment instruments are designed to meet short-term, medium-
term and long-term objectives. If an instrument is designed for a
short term the same is not suitable for achieving a long term
objectives. This is because the instrument would terminate in the
short term and the client would be exposed to reinvestment risks.
Long-term investments designed to provide real growth is a solution
to the long-term needs.
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The client can choose to invest directly where the risks are high and
the potential of a higher return also exists. However he would have
the disadvantage of being a small investor, who does not have the
expertise in the market, does not have large funds and is not able to
diversify. The mutual funds help the client in this area and pool the
investment of a group of small investors providing them with
expertise in investment, diversification and better returns.
However investment in mutual fund requires a strategy and the
returns depend on the time of entry and exit from the fund. Two
investors may make different kinds of return due to the different
strategies they follow. The Single Premium Whole of Life Insurance
Plan is designed to remove this problem of the investors by giving
insurance in the form of guarantees on death and at specific time
intervals so that the returns at these guaranteed periods do not
depend on the market conditions. These guarantees in long-term
investment are very valuable and since the product is a whole of life
one, the client can continue with the investment till death.
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Features of the Single Premium Whole of Life
Insurance Plan
The following are the features of the plan:
1. Benefits:
a) Death Benefits: In the event of death of the life assuredduring the term of the contract, and provided all the
premiums are paid till the time of the death of the lifeassured, the sum assured, together with the (compound)
reversionary bonus and the terminal bonuses (if any)
would be paid to the beneficiary. The policy would
terminate on payment of the death benefit.
b)Maturity Benefits: The Single Premium Whole of LifeInsurance Plan is a whole life plan and therefore does not
have a maturity date.
c) Paid up Benefits: This is not applicable to the SinglePremium Whole of Life Insurance Plan since the plan is a
single premium plan.
d)Minimum Guaranteed Surrender Benefits: On surrenderof the policy after a period of three years from the date of
commencement, there is and guarantee that the minimum
surrender value would be equal to 50% of the premium
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paid, except in the four weeks immediately following the
completion of the 10th policy year and every 5th year
thereafter, when the minimum guaranteed surrender
value would be equal to the sum assured.
e) Special Surrender Benefits: The Company at its solediscretion may pay special surrender values higher than
the guaranteed surrender values depending on the
investment and expense experience of the company. The
special surrender values would be paid after completion
of the first six months from the date of commencement of
the policy.
2. Frequency of premium payment:
The policyholder has to pay the premium by way of a single
premium only. The single premium payable is equal to 95% of
the sum assured chosen.
3. Premium:
The following are the premium conditions under the Single
Premium Whole of Life Insurance Plan:
Minimum Premium Rs. 23,750
Maximum Premium Rs. 47,50,000
4. Other conditions:
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Minimum Sum Assured Rs. 25,000
Maximum Sum Assured Rs. 50,00,000
Minimum Age at Entry 18 years
Maximum Age at Entry 70 years
5. Policy loans:
Policy loans would be available under the plan once the policy
acquires a surrender value. The policy loans would be to the
extent of 90% of the surrender value. The company would
quote the terms and conditions of the policy loans at the time of
granting the loans and the same would vary from time to time.
6. Life cover basis:
The Single Premium Whole of Life Insurance Plan can be
offered on a single life basis only.
7. Tax Benefits:
The Premium paid under the plan qualifies for tax rebate under
section 88 of the Income Tax Act 1961.
The plan is also approved under the provisions of section 80
DD of the Income Tax Act 1961.
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Positioning of the Single Premium Whole of LifeInsurance Plan
The Single Premium Whole of Life Insurance Plan can be positionedas along term investment vehicle with guarantees at specific dates.
The Plan is suited to help in providing a fund for long term financial
needs. The philosophy and practices of the company can help in
building the policy values for the client and hence positioning the
company is also important in the sale of the Single Premium Whole
of Life Insurance Plan.
7. Personal Pension Plan
Savings for a better retirement
Introduction
The Personal Pension Plan is a with profits deferred pension contract
which aims to give good pension benefits to the client by helping the
client build a retirement fund. The aim of the plan is to build good
fund values so that the client can enjoy a better pension on
retirement.
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Need for the Plan
Income in retirement is becoming more and more important. With
the breakup of the joint family system and the increase in longevity,
it is becoming more and more important to provide for retirement.
The fall in the interest rates and the uncertainty prevailing in the
market make pensions more attractive. Pension can provide a
guaranteed income till death and hence there is a renewed interest in
pension schemes in the recent years.
It is important that the person plans for his retirement. The planning
should start early so that the person contributes lesser amounts and
there is time for the fund to grow. For retirement there is only one
option for the person and that is to save. One cannot raise a loan for
retirement.
There are various instruments of savings and investment, which the
client can use to provide for his retirement. A deferred pension plan
has the following advantages:
I. The deferred pension plan can be issued for long terms so thatthe single instrument covers the retirement need of the client.
II. The deferred pension plan automatically vests in the lifeassured on the date of vesting. This is an advantage as the
likelihood that the fund would be used for some other purposes
is minimized and fund would be used only for retirement.
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III. Special tax benefits are available for investment in deferred
pension plans.
Features of the Personal Pension Plan
The following are the features of the plan:
1. Benefits:
a) Death Benefits: In the event of death of the life assuredduring the term of the contract the following amountwould be payable:
i. In the event of the death of the life assured in thefirst year then 90% of the premium paid would be
payable in case of single premium policies and 80%
of the premium paid would be payable in case of
regular premium policies.
ii. In the event of the life assured after the first year
Sum assured plus reversionary bonusattached would be payable under single
premium policies.
Lower of the sum assured plus reversionarybonus and return of premium paid with
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interest of 8% is payable, under regular
premium policies.
b)Benefits at Vesting: On the vesting date, provided thepolicy is in full force the Notional Cash Value (NCV)
would be used to pay the following:
i. Cash lump sum to the extent permitted by theregulations at the time of vesting. The policyholdermay choose either to take the cash lump sum or use
the full NCV to purchase an annuity.
ii. Purchase of an immediate annuity as per the choiceof the policyholder. In case the policyholder has
opted for the cash lump sum the balance NCVwould be used to purchase the annuity. In case the
policyholder has not opted for the cash lump sum
then the full NCV would be used to purchase the
annuity.
c) Paid up Benefits: In case the policyholder discontinuespayment of premium after the premiums are paid for at
least three years, the policy would be reduced to a paid-
up policy. The reduced paid up benefits would form the
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Notional Cash Value on the date of vesting of the policy.
The paid up policy will not participate in future bonuses.
d)Surrender Benefits: The policyholder can surrender thepolicy at any time. In case the policyholder chooses to
surrender the policy before the payment of three years
premium the surrender value would be equal to zero and
nothing would be payable. In case the policyholder
chooses to surrender after three years, he would beentitled for a surrender value.
2. Frequency of premium payment:
The policyholder can choose to pay single premium or regular
premium by yearly, half-yearly or quarterly mode. The
frequency of premium payment can be altered during the term
of the contract.
3. Days of grace:
The premium is payable in advance and should be paid within
the days of grace. The days of grace allowed under the plan are
15 days from the due date of premium. In case the days of grace
end on a holiday then the premium has to be paid on the next
working day.
4. Lapsation:
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In the event the premium is not paid within the days of grace
the policy lapses. The policy would be automatically reduced to
a paid up policy in case premiums have been paid for at least
three years. In case premiums are not paid for three years the
policy would lapse without value.
A lapsed policy can be reinstated within one year from the date
of lapse only.
5. Minimum premium:
The following are the minimum premium conditions under the
Personal Pension Plan.
Single Premium Rs. 25000
Annual mode Rs. 2400
Half yearly mode Rs. 1300
Quarterly mode Rs. 700
6. Maximum premium:
The following are the maximum premium conditions under the
Personal Pension Plan.
Single Premium Rs. 50,00,000
Annual mode Rs. 50,00,000Half yearly mode Rs. 25,00,000
Quarterly mode Rs. 12,50,000
7.Other conditions:
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Minimum Term 10 years
Maximum Term 40 years
Minimum Age at Entry 18 years
Maximum Age at Entry 60 years
Minimum Vesting Age 50 years
Maximum Vesting Age 70 years
The policyholder has the choice to choose any term between 10
to 40 years, subject to the minimum and maximum vesting age.
8. Policy loans:
Policy loans would not be available under the plan.
9. Life cover basis:
The Personal Pension Plan can be offered on a single life basis
only.
10.Tax benefits:
The premium paid under the plan qualifies for tax deductions
under section 80CCC of the Income Tax Act 1961.
The cash lump sum received at the date of vesting is tax free
under section 1010a (iii) of the Income Tax Act 1961.Surrender value during the deferment period would be taxable
as per section 80CCC of the Income Tax Act. Similarly pensions
received after vesting would be taxable in the hands of the life
assured.
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SWOT ANALYSIS
Strengths:
Weakness:
Frequent Job Rotation Less number of advertisements Hidden Charges
Opportunities:
Threats:
Country Wide Recognition Need Base Analysis Same Standard Services in all Branches Fair Deal in all Transactions Customers Centric Approach Infrastructure
Scope in Jaipur as it is in the developing phase Only 25% of insurable people have any insurance Higher possibility of growth in Indian share Market
LICs Brand Name People of Jaipur prefer short-term investment rather than in
insurance
Upcoming private insurance companies.
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FINDINGS & SUGESSTIONS
FINDINGS:
1. In HDFC SL I feel that Insurance sector is one of the most growingsectors among all sectors in India.
2. I also find that HDFC Standard Lifes Traditional Plans are veryuseful for a normal person.
3. Jaipur is one of the most growing city and there is lot of scope ofinsurance.
4. Most of the people are aware of traditional plans.
5. Electronic media has proved to be very beneficial for people tounderstand about the insurance.
6. There is lot of opportunities for young and energetic people inHDFC SL to build there sound career.
7.
HDFC Standard Lifes traditional plans like children plan, one ofthe most popular product of the company.
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SUGESSTIONS:
1)Use of creative advertisements to attract more and more targetcustomers and to create awareness among them.
2) HDFC SL should chalk out some programs to create generalawareness regarding its presence and various services of the
company.
3) Today is the era of competition. In order to increase thecompany network (In terms of clients and business volumes) an
aggressive approach is required.
4) HDFC SL should try to make its promotional activities moreeffectively.
5) HDFC Standard Life Company should regularly conductmarket research and surveys for knowing customers better and
for facing threat from competitors.
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QUESTIONNAIRE
To get a better insight about the advisor's satisfaction levelthe various improvements to be done in the HDFC StandardLife Insurance product.
Name: Qualification:
Age: Profession:
Tel no:
Ql. For how long are you working with HDFC StandardLife Insurance ?
o Less than 1 yr.
o l-2yr.
o 2-3 yr.
o More than 3 yrs.
Q2. How many products have you sold as an advisor?
o Less than 10.
o 10-20
o 20-30
o More than 30
Q3. What is the purpose of buying an insurance product byCustomers?
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o Tax benefit
o Investment
o Security
o Any other
Q4. Products which are sold most?
o Unit Jink plan
o Smart kit plan
o Annuity plan
Q5. Products which are sold least?
o Term plan
o Endowments plan
o Group insurance
Q6. Rate the products of HDFC Standard Life Insurance incomparison to its
Competitors?
(Best = 4 pts Good = 3 pts Average = 2 pts Poor = 1 pt)
o Best
o Good
o Average
o Poor
Q7. Which company do you think the best products available?
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Q8. What motivates you to stay in this business?
o Money
o Recognition
o Motivation by the co./UM
o Any other
Q9. Are you satisfied with the commission provided by theco.?
o Yes
o No
If no, then why _______
Q10. Are you satisfied with the facilities provided by the co. toit's a Advisors in comparison to other players?
o Yes
o No
If no, then why_^ _ ^ __
Q. l1. HDFC Standard Life Insurance how to better otherCompanies?
o Commission
o Recognition
o Better Products
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CONCLUSION
HDFC is the leading insurance service providers to public and
private sector. HDFC Standard Life is the first private insurancecompany which got license in 2000 from IRDA.
Life Insurance in India has a huge potential for growth. Statistics
reveal that only 25% of the insurable population in India is
insured. And those insured are in need of still higher insurance
cover. The cover 100% growth displayed by private life insurers
indicates this huge untapped potential.
Traditional plans like children plan gives invaluable support to
your child, Term Assurance Plan gives help secure your family
financial needs, Money Back Plan gives a wide range of terms and
cash benefit schedules to choose from, Personal Pension Plan is
designed to provide a post retirement income for life with the
freedom to choose the retirement date, Single Premium Whole of
Life Insurance Plan is a tailor-made plan well suited to meet your
long-term investment needs, Endowment Assurance Plan is
designed to provide a solution to the long term financial needs,
Loan Cover Term Assurance Plan is designed to cover outstanding
loans at the least possible cost.
At last we can conclude that HDFC SL provides best solutions to
its customers by giving them best value of their money.
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BIBLIOGRAPHY
y C. R. Kothari: Research Methodologyy Philip Kotler: Marketing Managementy Fact sheets of:
HDFC Standard Life CompanyWebsites
y www.google.com (search engine)y www.yahoo.com (search engine)y www.wikipedia.comy www.hdfcinsurance.comy www.hdfc.comNewspapers
Economics Times Times of India
Magazines
Business Today Business World