DECLARATION

I, Joydip Roy, A 6th semester student of Cooch Behar college’s bachelor Digree Program in Business Administration have done my poject from 3rd March’2011 to 3rd April’2011 in SBI Life Insurance CoochBehar.I have been under the guidance of Mr.Tuhin Nandi, Branch Sales Manager, SBI Life Insurance and Mr.Subendhu Chakroborty, Batch faculty.

I claim that this project is absolutely genuine and primary. Other similar research paper and literary review were followed.

Date:

Joydip Roy

To whom it may concern

This is to certify that Mr.Joydip Roy, S/O Mr.Sunil Kumar Roy is a bonafied student of CoochBehar College BBA Department, Roll Number-06/BBA/080011, Registration Number-060011, Session-2008-11. He is due to appear at 6th semester Examination of University of North Bengal.

To the best of my knowledge he bears a very good character.

Sankar Saha

(Co- ordinator)

To Whom it may concern

This is to certify that Mr. Joydip Roy, Roll Number-06/BBA/080011,Registration Number-060011,Session 2008-2011, a student of BBA of Cooch Behar College has successfully completed his project work from “SBI Life Insurance” Cooch Behar.

Subendhu Chakroborty

Internal guide

ACKNOWLEDGEMENT

I would like to express my profound gratitude to all those who have been instrumental in the preparation of this project report. I wish to place on records, my deep gratitude to my project report guide Mr. Subendu Chakroborty, a high esteemed and distinguished guide, for his expert advice and guide.

I would also like to thank Mr.PankajKumar Debnath (Principal, Cooch Behar College) and Mr.Shankar Saha, Course coordinator(B.B.A) for their support.

I am deeply grateful to Mr.Tuhin Nandi, Branch Sales Manager, SBI Life Insurance, CoochBehar, for the co-operation extended by him to conduct this study, advising me on this project and furnishing the required information.

I am also thankful to the ………………………. (SBI Life insurence) CoochBehar.

Last but not the least,I would like to thank my parents and friends for their constant help and support.

RAJIB PRASAD/ JOYDIP ROY

ROLL NO:06/BBA/080011

Introduction of Insurance Sector

The practice of insurance in the world is quite old infect. However, life insurance business, as it is known today, is a much later development. It evolved from the great transformation in life, which began with the decline of the agrarian society in the western countries in the 19century.Industrialization with its cities, factories, cash economy and an urban ‘saving’ class set the stage for life insurance as a large – scale national institution. It can truly be that life insurance is a product of modern industry. Growth of life insurance Company in any country will illustrate introduced modern life insurance business didn’t make much headway. The business started taking its deeper roots only when in the late 19century ‘India’ insurance companies appeared on the scenes and started accepting ‘India’ lies freely on the same terms as European lives in India. The growth of India life insurance business continued to remain restricted till the Swedish movement gathered momentum.The business passed through the period of ups and downs with the political and economic situation in the country.

Need for Association

With the rise in the number of Indian life insurance companies occasioned by the growth in the national spirit as a result of the independent movement a need was felt by the companies for an organization to assist them in solving the problems faced by them. With a view to meeting this need and also to providing a representative body for expression of a common viewpoint of Indian insurance before the government regarding insurance legislation and Indian life Assurance offices association was established in 1928. The association played companies’ forum for expression of representative views on insuranceand taxation legislation and imparting insurance education.

Nationalization

Even during days of the freedom struggle there was occasional demand for nationalization of life insurance industry. The demand naturally gathers mare momentum after independence. Mismanagement had lead to liquidation of as

many as 25 life insurance companies in the decade after independence. Another 25 insurance companies had during the same period so frittered away

their resources that their business had to be transferred to other companies. All these cost financial losses and consequent suffering to several policyholders who had entrusted their hard earned saving to the care of the companymanagement.This misuse of power, position and privilege by these companies in the private sector was one of the most compelling reasons that influenced the decision of the government of India to nationalize the life insurance industry in 1956. The life insurance industry in India had to be geared up for raising resources for execution national programs. One of the objectives of the national plans was to build a pay welfare state. It was therefore, essential that benefits of life insurance were made available to every family in the country and that the business should be conducted with utmost economy by the management acting in a spirit of trusteeship to enable maximization of the people’s saving that could be analyzed through the life insurance into the development programs.

Objectives of nationalization:

The decision of the Government of India to nationalize life insurance industry was implemented by the passage of the life insurance Corporation Act, 1956, by Parliament. The objectives of nationalization of life insurance industry that emerged out of the discussion and speeches in the parliament in the time passage of the act were: Spread of message of life insurance as far and wide as possible reaching out beyond the more advanced urban areas well into hitherto neglected areas.

Effective mobilization of the people’s savings. Complete security to policyholders. Prompt and efficient services to the policyholders. Conducting of the business with the utmost economy and with the full

realization that the money belonged to the policyholders. Investment of funds in such a way as to secure maximum yield

consistent with safety of capital. Economic premium rates. Development of a dynamic and vigorous organization under a

management conducted in sprit of trusteeship.

Formulation of scheme of insurance to suit different section of the

Community.How big is the insurance market?

Insurance is an Rs.400 billion business in India, and together with banking services adds about 7% to India's Gap. Gross premium collection is about 2% of Gap and has been growing by 15-20% per annum. India also has the highest number of life insurance policies in force in the world, and total investible funds with the LIC are almost 8% of GDP. Yet more than three-fourths of India's insurable population has no life insurance or pension cover. Health insurance of any kind is negligible and other forms of non-life insurance are much below international standards.

Indian Scenario:

Unfortunately the concept of insurance is not popular in our country .As per the latest estimates, the total premium income generated by life and general insurance in India is estimated at around a meager 1.95% of GDP. However India's share of world insurance market has shown an increase of 10% from 0.31% in 2004-2005 to 0.34% in 2005-2006.India's market share in the life insurance business showed a real growth of 11 % thereby outperforming the global average of 7.7% Non-life business grew by 3.1% against global average of 0.20%. In India insurance spending per capita was among the lowest in the world at $7.6 compared to $7 in the previous year. Amongst the emerging economies, India is one of the least insured countries but the potential for further growth is phenomenal, as a significant portion of its population is in services and the life expectancy has also increased over the years.

Need for insurance:

Modern life insurance caters to multiple needs for insurance, which can be broadly classified as under:

Cash and income needs on an immediately following death. Family income needs. Income needs of a widow on the death of her husband. Cash and income needs of a husband on the death of his wife. Retirement income needs.

Education needs. Business needs

What is Human Life Value (HLV)?

Human life value is:1. Capitalized value of the net earnings.2. Present value of the total income lost to the family in the event death.

These points will be more cleared with this example: Suppose an individual earns Rs. 10000/month. The personal expense is Rs.2000/month. Therefore the income provided to his family is Rs. 8000/month. The annual income provided to his family works out to Rs. 96000. Now if he were not to earn it for them, the family would have to

*******Rs.1600000 in a bank so that they get Rs. 96000 yearly at 6% interest.(96000*100/6).6 Therefore the HLV of the person is Rs. 1600000.Ps. Note that we have not taken into account the future income growth of the person. Hence this is not the exact human life value but only a representation to give the customer a fair idea of how it works.

What is a contract of insurance?

A contract of insurance is a contract of utmost good faith, technically known as uberrima fides. The doctrine of disclosing all material facts is embodied in this important principal that applies to all forms of insurance. The purpose, who is one of the parties to the contract, is presumed to have means of knowledge that are not accessible to the corporation who is the other party to the contract. Therefore, the purpose is bound to tell the insurer everything affecting the judgment of the insurer. In all the contracts of insurance the proposes is bound to make full disclosure of all material facts and not merely, those which he thinks material Misrepresentation non-disclosure or fraud in any document leading to the acceptance of the risk automatically discharges the corporation from all liability under the contract. Although Section 45 of the Insurance Act.

1938 provides that no policy can be called in question after a period of two years from the date of its issue on the ground that any statement in proposal

or a related document was false or inaccurate (making the policy indisputable),

This provision is not applicable if the corporation can prove that misrepresentation or nondisclosure was on a material fact and was fraudulently made and that the policyholder knew at the time that statement he made was false. It is, therefore, in the interest of the policyholder to disclose all the material facts to the corporation to avoid any complication when the claim arises. It is equally obligatory on an agent to see that the assured doesn't obtain the contract by means of untrue representation or concealment in any respect. It is the duty that the agent owes both to his client and to the corporation.

Classification of insurance business:

The insurance is broadly classified as:1 .Life insurance business2. Non-life insurance business

Life insurance business:

It is the business of effecting contracts of insurances upon human life including any contract whereby the payment of money is assured on death or on the happening of any contingency to the dependent on human life and any contract which is subject to the payment of premiums for a term and shall be deemed to include: The granting disability and double and triple indemnity accident benefits, if so provided in the contract of insurance. The granting of annuity of human life. The granting of super-annulations allowance and annuities payable out of any fund applicable solely to the relief and maintenance of the person engaged or who have been engaged in any particular profession, trade or employment or of the dependents of such persons.

Non life insurance business:

Conventional classification of insurance business: Fire insurance Marine insurance Miscellaneous insurance (accident)

Modern classification of general insurance: Insurance of person Insurance of property Insurance of interest Insurance of liability

ROLE OF INSURANCE REGULATORY AND DEVLOPMENTAUTHORITY (IRDA) ACT, 1999

An act to provide for the establishment of an authority to protect the interests of policyholders, to regulate, to promote and ensure orderly growth of the insurance industry and for matters connected therewith for incidental thereto and further to amend, the Life Insurance Corporation Act, 1956 and the insurance Act, 1938 and General Insurance Business Act 1972. Spread Life Insurance much more widely and in particular to the rural areas and to the socially and economically backward classes with a view to reaching all insurable persons in .the country and providing them adequate financial cover against death at a reasonable Cost. Maximize mobilization of people's savings by making insurance linked savings adequately attractive. Bear in mind, in the investment of funds, the primary obligation to its policyholders, whose money it holds in trust, without losing sight of the interest of the; community as a whole; the funds to be deployed to the best advantage of the investors as well as the community as a whole, keeping in view national priorities and obligations of attractive return. Conduct business with utmost economy and with the full realization that the moneys belong to: the policyholders. Act as trustees of the insured public in their individual and collective capacities. Meet the various life insurance needs of the community that would arise in the changing social and economic environment. Involve all people working in the

corporation to the best of their capability in furthering the interests of the insured public by providing efficient service with courtesy. Promote amongst

all agents and employees of the Corporation a sense of participation, pride and job satisfaction through discharge of their duties with ded1cat1on towards achievement of Corporate Objective.

INTRODUCTION OF SBI LIFE

SBI Life Insurance Company Limited is a joint venture between the State Bank of India and BNP Paribas Assurance. SBI Life Insurance is registered with an authorized capital of Rs 2000 crores and a Paid-up capital of Rs 1000 Crores. SBI owns 74% of the total capital and BNP Paribas Assurance the remaining 26%. State Bank of India enjoys the largest banking franchise in India. Along with its 7 Associate Banks, SBI Group has the unrivalled strength of over 14,500 branches across the country, arguably the largest in the world.

BNP Paribas Assurance is the life and property & casualty insurance unit of BNP Paribas - Euro Zone’s leading Bank. BNP Paribas, part of the world’s top 6 group of banks by market value and a European leader in global banking and financial services, is one of the oldest foreign banks with a presence in India dating back to 1860. BNP Paribas Assurance is the fourth largest life insurance company in France, and a worldwide leader in Creditor insurance products offering protection to over 50 million clients. BNP Paribas Assurance operates in 41 countries mainly through the banc assurance and partnership model.

SBI Life has a unique multi-distribution model encompassing Banc assurance, Agency and Group Corporate. SBI Life extensively leverages the SBI Group as a platform for cross-selling insurance products along with its numerous banking product packages such as housing loans and personal loans. SBI’s access to over 100 million accounts across the country provides a vibrant base for insurance penetration across every region and economic strata in the country ensuring true financial inclusion. Agency Channel, comprising of the most productive force of more than 63,000 Insurance Advisors, offers door to door insurance solutions to customers.

SBI

State Bank of India (SBI) is the largest bank in India. The bank traces its ancestry back through the Imperial Bank of India to the founding in 1806 of the Bank of Calcutta, making it the oldest commercial bank in the Indian Subcontinent. The Government of India nationalized the Imperial Bank of India

in 1955, with the Reserve Bank of India taking a 60% stake, and renamed it the State Bank of India. In 2008, the Government took over the stake held by the Reserve Bank of India. SBI provides a range of banking products through its vast network in India and overseas, including products aimed at NRIs. The State Bank Group, with over 16000 branches, has the largest branch network in India. With an asset base of $250 billion and $195 billion in deposits, it is a regional banking behemoth. It has a market share among Indian commercial banks of about 20% in deposits and advances, and SBI accounts for almost one-fifth of the nation’s loans. SBI has tried to reduce its over-staffing through computerizing operations and Golden handshake schemes that led to a flight of its best and brightest managers. These managers took the retirement allowances and then went on the become senior managers at new private sector banks.The State bank of India is 29th most reputable company in the world according to Forbes.

BNP Paribas

BNP Paribas is one of the main banks in Europe. It was created on 23 May 2000 through the merger of Banque Nationale de Paris (BNP) and Paribas. Together with Société Générale and Crédit Lyonnais (now known as LCL), it is one of the "three old" banks of France. It is a constituent of the CAC 40 index.On 9 August 2007, BNP Paribas announced that it could not fairly value the underlying assets in three funds as a result of exposure to U.S. subprime mortgage lending markets.Faced with potentially massive (though unquantifiable) exposure, the European Central 12 Bank (ECB) immediately stepped in to ease market worries by opening lines of €96.8 billion (then US$130 billion) in low-interest credit. The long term debt of the group iscurrently ranked AA by S&P, Aa1 by Moody's and AA by Fitch.On 28 April 2009, the General Meeting of Shareholders of Fortis SA/NV in Ghent voted

in favour of the transactions with the Belgian State and BNP Paribas with a majority of 72,99%. At the General Meeting of Shareholders of Fortis N.V. in

Utrecht on April 29,77.65 percent of shares voted in favour of BNP's purchase of a 75 percent stake in Fortis Bank, the Belgian banking business now in state hands. This confirms the deal for BNP Paribas to take a majority stake in Fortis Bank to make it the euro zone’s largest deposit holder through its positions in Belgium and Luxembourg.

ULIPs vs. Mutual Funds

ULIPs vs. Mutual Funds: Who's better?

Unit Linked Insurance Policies (ULIPs) as an investment avenue are closest to mutual funds in terms of their structure and functioning. As is the cases with mutual funds, investors in ULIPs are allotted units by the insurance company and a net asset value (NAV) is declared for the same on a daily basis. Similarly ULIP investors have the option of investing across various schemes similar to the ones found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to name a few. Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance component. However it should not be construed that barring the insurance element there is nothingdifferentiating mutual funds from ULIPs.

How ULIPs can make one RICH!

Despite the seemingly comparable structures there are various factors wherein the two differ.

1. Mode of investment/ investment amounts

Mutual fund investors have the option of either making lump sum investments or investing using the systematic investment plan (SIP) route which entails commitments over longer time horizons. The minimum investment amounts are laid out by the fund house.21 ULIP investors also have the choice of investing in a lump sum (single premium) or using the conventional route, i.e. making premium payments on an annual, half-yearly, quarterly or monthly

basis. In ULIPs, determining the premium paid is often the starting point for the investment activity.This is in stark contrast to conventional insurance plans

where the sum assured is the starting point and premiums to be paid are determined thereafter.ULIP investors also have the flexibility to alter the premium amounts during the policy's tenure. For example an individual with access to surplus funds can enhance the contribution thereby ensuring that his surplus funds are gainfully invested; conversely an individual faced with a liquidity crunch has the option of paying a lower amount (the difference being adjusted in the accumulated value of his ULIP). The freedom to modify

premium payments at one's convenience clearly gives ULIP investors an edge over their mutual fund counterparts.2. ExpensesIn mutual fund investments, expenses charged for various activities like fundmanagement, sales and marketing, administration among others are subject to predetermined upper limits as prescribed by the Securities and Exchange Board of India. For example equity-oriented funds can charge their investors a maximum of 2.5% per annum on a recurring basis for all their expenses; any expense above the prescribed limit is borne by the fund house and not the investors. Similarly funds also charge their investors entry and exit loads (in most cases, either is applicable). Entry loads are charged at the timing of making an investment while the exit load is charged at the time of sale. Insurance companies have a free hand in levying expenses on their ULIP products with no upper limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development Authority. This explains the complex and at times 'unwieldy' expense structures on ULIP offerings. The only restraint placed is that insurers are required to notify the regulator of all the expenses that will be charged on their ULIP offerings.Expenses can have far-reaching consequences on investors since higher expenses translate into lower amounts being invested and a smaller corpus being accumulated. ULIP-related expenses have been dealt with in detail in the article "Understanding ULIP expenses".

3. Portfolio disclosure

Mutual fund houses are required to statutorily declare their portfolios on a quarterly basis, albeit most fund houses do so on a monthly basis. Investors get

the opportunity to see where their monies are being invested and how they have been managed by studying the portfolio.

There is lack of consensus on whether ULIPs are required to disclose their portfolios. During our interactions with leading insurers we came across divergent views on this issue.While one school of thought believes that disclosing portfolios on a quarterly basis is mandatory, the other believes that there is no legal obligation to do so and that insurers are required to disclose their portfolios only on demand. Some insurance companies do declare their portfolios on a monthly/quarterly basis. However the lack of transparency in ULIP investments could be a cause for concern considering that the amount invested in insurance policies is essentially meant to provide for contingencies and for long-retirement; regular portfolio disclosures on the other hand can enable investors to make timely investment decisions.

ULIPs Mutual Funds :

ULIPs Mutual Funds

Investment amountsDetermined by the investorand can be modified as well

Minimum investmentamounts are determined bythe fund house

Expenses

No upper limits, expensesdetermined by the insurancecompany

Upper limits for expenseschargeable to investors havebeen set by the regulator

Portfolio disclosureNot mandatory* Quarterly disclosures

aremandatory

Modifying asset allocation

Generally permitted for freeor at a nominal cost

Entry/exit loads have to beborne by the investor

Section 80C benefits areavailable on all ULIPinvestments

Section 80C benefits areavailable only oninvestments in tax-savingfunds

SBI Life - Saral Maha Anand.

SBI Life - Saral Maha Anand is a unique product created just for you, which will pleasantly surprise you with its sheer Simplicity and Convenience! It is a Unit Linked non-participating Life Insurance Plan, which lets you manage your investments according to your risk appetite, giving you the power to realise market related returns on your policy. You can choose your required Life Insurance cover subject to a minimum and a maximum level.

Key Features of SBI Life - Saral Maha Anand .

• Simple joining process; no medical examination

• Guaranteed Addition of up to 30% of Annualised Premium

• Option to avail additional Rider Benefit under SBI Life - Accidental Death Benefit Linked Rider

• No Premium Allocation Charge from 11th year onwards, thereby boosting your Fund Value

• 4 Fund Options to get market related returns as per your risk appetite

• Liquidity through Partial Withdrawals

• Tax benefits on premiums paid and benefits received as per the Income Tax Act, 1961

How does the plan work?

• You need to choose premium amount and the Policy Term.

• Your premiums after deduction of Premium Allocation Charge are invested into Funds of your choice.

• On Maturity, accumulated Fund Value will be paid to you. In case of unfortunate event of death, your nominee will receive Higher of the Fund Value or Sum Assured; with a minimum of 105% of total premiums paid.

Death Benefit:

Higher of the Fund Value or Sum Assured is payable; with a minimum of 105% of total basic premiums paid till the time of death. Sum Assured and amount equal to 105% of total basic premiums paid till the time of death will be reduced to the extent of Partial Withdrawals made in the last 24 months for age on death below 60 years and for age at death 60 years & above all withdrawals made from 58 years onwards.

Maturity Benefit:

• On survival of the Life Assured up to maturity, the Fund Value shall be paid in a lump sum.

• Alternatively, the Maturity Benefit can be availed in installments under 'Settlement' option, which helps you to get periodic

installments of your maturity proceeds within five years (maximum) from the Date of Maturity. During the Settlement Period, the Fund Value will remain invested in the existing Funds as per the prior allocation. The investment risk is continued to be borne by the Policyholder. No charges except Fund Management Charges & Switching Charge, if any, will be applicable. Partial Withdrawals are not allowed during this period. Switches are allowed as per conditions mentioned in Switching Option. At any point of time, if you ask for payment of remaining Fund Value the same will be paid immediately. In case of death before the end of the settlement period, remaining Fund Value is payable immediately as a lump Sum to the nominee/beneficiary.

Additional Features of the Plan:

Tax Benefit##:

• U/s 80C of the Income Tax Act 1961 on your premiums paid under the Basic Policy and Accidental Death Benefit Linked Rider.

• U/s 10(10D) of the Income Tax Act 1961 on your Maturity Proceeds / the Death Benefit under the policy.

##Subject to change in the Tax Laws. Please consult your Tax Advisor for details.

SBI Life - Smart Elite

What is 'SBI Life - Smart Elite'?

This is a Unit Linked Life Insurance Plan which gives you flexibility to pay premium(s) for limited term or pay a Single Premium, with the freedom to stay invested and protected for the long term. You need to select Premium Payment Term, Policy Term and Premium Amount. You also need to select the Sum Assured Multiple for Life Cover and Plan Option for protection as per your life stage and requirement. The options available for protection are Gold Option and Platinum Option giving you choice of higher of Sum Assured or Fund Value or both, respectively. One of these options has to be chosen at the outset of policy and cannot be changed during the policy term. The premium amount is invested in Funds of your choice which gives you market related returns.

Key features of 'SBI Life - Smart Elite:

• Maximum value addition through Excellent Allocation Rates.

• Pay Premiums only for a Limited Term of 5, 8 or 10 years or a Single Payment, as per your convenience to enjoy benefits throughout the chosen Policy Term.

• Market linked returns, which in the long term are proven to give better returns.

• No Premium Allocation Charge from 6th Policy Year onwards, thereby enhancing your Fund Value.

• Invest in wide range of Funds and manage them as per your convenience.

• Two protection options available: Gold Option & Platinum Option.

• Life Insurance coverage with minimum Sum Assured of 10 or 7 times of your Annual Premium (AP) (based on your age).

• Switch and redirection facility, to pilot your investments.

• Option to increase/decrease your Sum Assured from 6th year onwards.

• Accidental Death and Accidental Total and Permanent Disability (Accidental TPD) benefit automatically comes to you as an integral part of the plan!

Benefits of SBI Life- Smart Elite:

In case of unfortunate event of death of the Life Assured, the beneficiary will receive following benefit:

For Gold Option: Higher of Fund Value or Sum Assured is payable; with a minimum of 105% of total premiums paid of intimation of the death claim.

For Platinum Option: Fund Value plus Sum Assured is payable; with a minimum of 105% of total premiums paid as on the date of intimation of the death claim.

In-built Benefit: Accidental Death and Accidental Total and Permanent Disability (Accident Benefit).

This is an in-built benefit. This benefit provides an additional benefit for Accidental Death or Accidental TPD. The benefit would be equal to Basic Sum Assured, subject to an overall maximum of Rs. 50 Lakhs for this plan. In respect of Accidental Death, the amount payable is paid in a lump sum, whereas for Accidental TPD, the benefit will be paid to the Life Assured in 10 equal annual instalments. Accidental Death should occur within 120 days of the date of accident, solely and directly due to injuries and Independent of all other causes. In case of Accidental TPD Benefit the permanence of the disability will only be established 6 months following the date of the disability.

This Accident Benefit shall be payable only once, i.e. in the event of death or disability whichever occurs first. In case of claim towards Accidental TPD, Accident Benefit will cease and no charges towards the same will be deducted from your Fund. However, the policy will continue with basic life benefit and you would continue to pay all due premiums thereafter. In case of death of Life Assured during the payment of the accidental TPD installments the discounted value of remaining instalments would be paid to the beneficiary (e.g. assignee, nominee, legal heir, etc of the Life Assured)

Maturity Benefit:

• On survival of the Life Assured up to maturity, the Fund Value shall be paid in a lump sum.

• Alternatively, the Maturity Benefit can be availed in installments under 'Settlement' option, which helps you to get periodic installments of your maturity proceeds within five years (maximum) from the Date of Maturity. During the settlement period, the Fund Value will remain invested in the existing Funds as per the prior allocation. The investment risk is continued to

be borne by the Policyholder. No charges except Fund Management Charges will be applicable. Partial Withdrawals and switches are not allowed during this period. At any point of time, if you ask for payment of remaining Fund Value the same will be paid immediately. In case of death before the end of the

settlement period, remaining Fund Value is payable immediately as a lump Sum to the nominee/beneficiary (e.g. legal heir). In order to exercise settlement option you have to provide a notice to the Company, two months before the date of maturity of your policy.

IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT

PORTFOLIO IS BORNE BY THE POLICYHOLDER

With the changing social and economic environment, shifting individual and family needs, it is advisable to follow a dynamic retirement planning process to improve the probability of success of your retirement plan. We know that increasing longevity and a dynamic working span would require a simple and flexible pension plan, which provides you the opportunity to maintain your current standard of living even after retirement. We at SBI Life Insurance understand your needs the best and are proud to present to you, SBI Life-Smart Pension. A Unit Linked deferred pension plan, which offers you the flexibility to provide for all your retirement goals at one go or as per your convenience, spread over a period of time. All this,so as to ensure that you receive regular income as per your choice in your golden years. What's more, it provides you a minimum guaranteed return on the gross premiums paid. This is a pure pension plan, without any Life Cover.

Key Features of SBI Life - Smart Pension:

• Enjoy the benefit of guaranteed amount at maturity or vesting.

• Option to avail pension by paying only Single Premium.

• Phase your retirement income - you have an option to take multiple Single Premium Policies, at lower costs.

• Freedom to avail different Annuity Options.

• Tax Benefits as per the prevailing Tax Laws.

How does the plan work*?

• You need to choose Single Premium amount and one of the four available policy terms.

• Your premium after deduction of the Premium Allocation Charge is invested into the Guaranteed Pension Fund. (GPF)

* The policy can be bought, only if the Fund is open for subscription.

What is the Guaranteed Pension Fund? (GPF)

The Objective of the Fund is to maximize returns subject to a guaranteed return over a fixed period. It aims to guarantee a reverse repo related return by investing mostly in fixed income securities (debt instruments, money market instruments and cash) with maturities close to the maturity date of the Fund.

Special Benefits:

Guaranteed Amount:

• The product offers you a Minimum Guaranteed Return of 4.5% per annum (on gross premium), applicable for this financial year 2010-11, for all premiums received up to March 31st 2011.

• Starting from 1st April 2011, every year the guaranteed interest rate shall be 50 basis points above the average of the reverse repo rate prevailing as on the last working day of June, September, December and March of the previous financial year.

• The guaranteed interest rate applicable shall be subject to a maximum of 6% and a min of 3%.

• The Single Premium paid will be accumulated at the above guaranteed interest rate to give the "Guaranteed Amount" at the end of the financial year.

• Thereafter, the opening "Guaranteed Amount" at the start of the financial year will be accumulated at the guaranteed interest rates every year to give the "Guaranteed Amount" at the end of the financial year.

Phased Retirement Income:

• You have an option to take multiple Single Premium Policies, whenever you have lump-sum money available. This would help you to match the inflating pension required after your retirement.

• You can plan a phased retirement over a period of your choice by investing Single Premiums at different times over a period. Your pension would correspondingly increase as the policies taken at different times vest over a period.

• You will get the added advantage of a spread of annuity rates prevailing over a period and avoid unfortunately getting locked into a low annuity rate at a single point.

• As a special benefit for loyal customers, we would be capping the overall policy administration charges to Rs. 100 per month, irrespective of the number of policies you have opted for under single life.

Death Benefit:

In the unfortunate event of death of the policyholder, the Fund Value is payable in lump sum to the nominee or legal heir of the policyholder as on the date of intimation of the claim to the company.

Maturity Benefit:

The Policy will be terminated at maturity. The maturity benefit will be the higher of Fund based on NAV at maturity or the 'Guaranteed Amount' at maturity. The Fund Value can be utilized as follows:

1) Purchase Annuity Plan for the entire amount.

OR

2) Commute up to one third of Fund Value as lump sum and the balance can be used for the purchase of annuity.

SBI LIFE- SMART PERFORMER

Introduction: The equity market may have its ups and downs, but you now have a protective shield that will safeguard your investments, while providing upside potential. SBI Life brings you ’Smart Performer’, a unique Unit Linked, Non Participating insurance product that offers you the twin benefits of ’Higher than the Highest’ of the daily NAV Guarantee and the prospect of market upside. What’s more, it also allows you to protect your gains through Automatic Rebalancing facility and offers you a choice of Single and Limited Premium Payment options.

Key Features:

•Guarantee at maturity based on ’5% Higher than Highest Guaranteed NAV’ during the first seven years or prevailing NAV at Maturity, whichever is higher, subject to conditions#.

•Enjoy the best of both worlds - Guarantee only or Guarantee and Market Upside through our unique Plan offerings - ‘Secure Plan’ and

‘Secure N Grow Plan’ respectively

•‘Automatic Rebalancing’ to Lock-in your gains

•Convenience through single premium (SP) or 5 year Premium Paying Term (PPT)

•Life Insurance coverage with minimum Sum Assured of 10 times

or 7 times of your Annualised Premium (AP), based on your age.

•Liquidity through Partial Withdrawal(s)

•Option to customize the product with Accidental Death Benefit

•Attractive Tax benefits under the Income Tax Act, 1961, subject toconditions **

Benefits:

•Maturity Benefit: On completion of Policy Term, Maturity Value will bepaid.Maturity value for the Daily Protect Fund II will be calculated based on NAV which is higher of:

• Prevailing NAV as on date of Maturity OR

• Higher than Highest Guaranteed NAV: There will be an increment of 5% to the Highest NAV achieved during the first seven years underthe‘DailyProtectFundII’.

•Death Benefit: Higher of the Fund Value or Sum Assured## is payable; subject to a minimum of 105% of the total premiums paid## at the time of death. The death benefit is payable only for inforce policies.

•Accidental Death Benefit Option: Accidental Death Benefit: Provides additional death benefit if the death occurs as a result of an accident.

The Guaranteed NAV is applicable only in respect of the Daily Protect Fund II and shall be available only at maturity, and shall be further subject to the Policy being in force till the maturity date. Guarantee charge of 0.50% p.a. of Daily Protect Fund II value, would be recovered from the fund (through cancellation of units) to provide the NAV guarantee.

## Net of partial withdrawals

**Tax benefits are subject to change in tax laws. Please consult your tax advisor for details.

IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS BORNE BY THE POLICY HOLDER

Life begins afresh when you become a parent. Its a joy you never felt and a feeling you never experienced. And when your child takes baby steps towards you, nothing seems more blissful.

With this divine happiness comes a new sense of responsibility that's close to your heart. You want to make your child's life a bed of roses or a tender cushion. At SBI Life, we understand your needs and provide you with a unique, flexible and all-encompassing solution: the SBI Life - Smart Scholar Plan. Secure your child's future by gaining from the financial markets. Our specially crafted Smart Scholar Plan is as accommodating as you are to your child.

Why should I take Smart Scholar Plan ?

To secure your child's future by gaining from the financial markets and much more:

•Dual Protection for your family, in case you are not around -

a) Payment of base Sum Assured and

b) Inbuilt Premium Payor Waiver benefit to ensure continuance of your policy.

• In addition, Accident Benefit which includes Accidental Death benefit and Accidental Total and Permanent Disability (Accidental TPD) benefit, is an integral part of the plan.

• Free allocation of units by way of regular Loyalty Unit Additions, giving periodic boosts to your investments.

• Enhanced investment opportunity through 9 varied Fund Options including P/E Managed Fund, Index Fund & Top 300 Fund.

• Twin Benefits of market linked returns & insurance benefits.

• Flexible Options to meet your changing requirement.

• Liquidity through Partial Withdrawal(s)

What is Smart Scholar Plan?

It is a Unit Linked Child cum Life Insurance plan available for parents (Life Assured) who have a child aged between 0 - 17 years. You can pay premiums for a limited period whereas the policy benefits would continue till your child becomes an adult.

Your money can be invested in any of the available Nine Funds, as per your choice and risk appetite. At the end of the term your accumulated Fund Value can be used for your child's higher education, marriage, financial security or anything else, while withdrawals facility helps you to meet unplanned

expenses.

Protection for your child's future in your absence:

In case of your unfortunate death due to any reason other than accident:

• Benefit 1: We pay a lump sum benefit equal to maximum of Sum Assured and 105% of all basic premiums paid as on the date of intimation of death claim. If on the date of intimation of death, the Sum Assured is less than 105% of all premiums paid, the amount in excess of the Sum Assured will be paid from your Fund by disinvestment of units.

• Benefit 2: We continue to pay your future premium(s) on your behalf (inbuilt Premium Payor Waiver Benefit) and the accumulated Fund Value will be paid at maturity.

In case of your unfortunate accidental death or accidental total and permanent disability we pay:

• Additional benefit equal to Accident Sum Assured

The Accident Benefit and Premium Payor Waiver Benefit are not available in the Single Premium policies.

Benefits of Smart Scholar Plan:

Basic Life Benefit:

In the event of unfortunate death of Life Assured, a lump sum benefit equal to higher of the Sum Assured or 105% of all premiums paid till date of death will be payable.

If on the date of death, the Sum Assured is less than 105% of all premiums paid, the amount in excess of the Sum Assured will be paid from your Fund by

disinvestment of units.

In the event of death of child no Sum Assured is payable. Life Assured will inform the Company regarding the event. In such case he/she can either continue the policy or terminate the contract. In case of termination of contract, the Fund Value (without any Surrender Charges),will be payable.

If both the Life Assured and the child die during the term of the policy, the policy will be automatically terminated and all due benefits will be paid along with the Fund Value.

Maturity Benefit:

On completion of the Policy Term, Maturity Benefit i.e. the Fund Value shall be paid to beneficiary in a lump sum or as per settlement option, if chosen.

The beneficiary will be:

The Policyholder if he/she survives

OR

Child, in case of death of the Life Assured during the Policy Term

Unit Plus Supper

IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT

PORTFOLIO IS BORNE BY THE POLICYHOLDER

Key Features of Unit Plus Supper :

• Guaranteed Additions upto 75% of one Annual Regular Premium

• Guaranteed Additions starting as early as 10th Policy Year onwards

• No Policy Administration fees for first 5 years for Regular and Limited Premium Paying Term (LPPT) plans, thereby boosting your Fund Value

• No Premium Allocation Charge from 11th year onwards

• Enhanced investment opportunity through 9 varied Fund Options including P/E Managed Fund, Index Fund & Top 300 Fund

• Life Insurance coverage, with minimum Sum Assured based on your age

• Option to customize the product with a wide range of riders - Criti Care 13 Rider, Accidental Death Benefit Linked Rider, Premium Payor Waiver Benefit Rider and Income Sustainer Rider

• Flexible product with an option to increase/decrease your Sum Assured from 6th Policy Year onwards

HOW DOES IT WORK ?

The premiums paid by you, net of Premium Allocation Charges are invested in Fund(s) of your choice. The units are allocated depending on the price of units for the Funds. The Fund Value is the total value of units that you hold across all the Unit-Linked Funds. You also have the option to have added protection by choosing any one or more of the riders. The premium for the rider(s)will be payable additionally over and above the basic Annual Premium.

In-force policies are rewarded in the form of Guaranteed Additions on completion of specific durations. For Regular & Limited Premium policies such Guaranteed Addition is a percentage of Annual Premium. For Single Premium policies the Guaranteed Additions would be a fixed percentage of the Single Premium.

BENIFITS:

LIFE COVER BENIFITS:-

Higher of the Fund Value or Sum Assured is payable; with a minimum of 105% of total basic premiums paid till the time of death.Sum Assured and amount equal to 105% of total basic premiums paid till the time of death will be reduced to the extent of Partial Withdrawals made in the last 24 months for age on death below 60 years and for age at death 60 years & above all withdrawals made from 58 years onwards.

Maturity Benefit

●On survival of the Life Assured up to Maturity, the Fund Value shall be paid in a lump sum.

●Alternatively, the Maturity Benefit can be availed in installments under 'Settlement' option, which helps you to get periodicinstallments of your Maturity proceeds within five years from the Date Of Maturity. During the settlement period, the Fund Value will remain invested in the existing Funds as per the prior allocation. The investment risk is continued to

●Charge, if any will be applicable. Partial Withdrawals are not allowed during this period. Switches are allowed as per conditions mentioned in switching option. At any point of time, if you ask for payment of remaining Fund Value the same will be paid immediately. In case of death before the end of the settlement period, remaining Fund Value is payable immediately as a lump sum to the nominee/beneficiary (e.g. legal heir).

If your personal and/or financial circumstances change and you wish to alter your insurance plan to suit your new requirements then you have the flexibility of changing your Sum Assured Multiplier Factor (SAMF) subject to the limits provided in the product at the time of such change request.

●You have the option to change the SAMF at each Policy Anniversary date starting from the 6th Policy Year.

●Such flexibility to change SAMF can be allowed provided all due Regular Premiums have been paid and the Company has been intimated in writing at least 2 months before the Policy Anniversary.

●The flexibility to change the SAMF can be exercised only 3 times, in total, in the entire Policy Term. The changes in SAMF must be within the limits provided by the product.

Any increase in the Sum Assured due to increase in SAMF would be subject to underwriting and is not available at age 50 years and above. The Rider Benefit remains unchanged on increase in Sum Assured.

●Cost of medical examination and tests, if any, will be borne by you.

●Decrease in Sum Assured due to reduction in SAMF will affect the Rider Benefit which will be automatically adjusted to stay below or equal to the reduced basic Sum Assured. Premium for Rider Benefit will be accordingly reduced. For Single

Premium Riders, Surrender Value towards the reduced Sum Assured will be paid.

Smart Wealth Assure:

IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS BORNE BY THE POLICYHOLDER

Equity Market Performance is affected by many variables like Economic condition, Liquidity, Corporate Performance, Global Markets, etc. Thus you are not sure what returns you will get on your hard earned money...

SBI Life realises the same and brings to you SBI Life - ‘Smart Wealth Assure’* which takes care of all these variables and gives you 'Peace of Mind' by providing a Minimum NAV Guarantee Plus Upside, if any.

Smart Wealth Assure is a unit Linked non participating Life Insurance Plan. The Plan is further fortified with many power packed features which takes care of your financial needs.

Key Benefits:

• Option to choose a mix of Funds providing Guaranteed Return and Market Linked Returns

• Guaranteed Return provided through Return Guarantee Fund (RGF) which guarantees a Minimum Pre-specified NAV

• Apart from Minimum Guarantee, any upside in the RGF will also be paid to You…

• Market Linked Returns provided through 3 Funds - Bond Fund, Equity Fund & P/E Managed Fund to give you the best possible returns

• Pay only once and get the benefits throughout the Policy Term

• Liquidity through Partial Withdrawal(s)

• Option to customize the product with Accidental Death Benefit Option

• An excellent investment cum insurance plan

How does the plan work?

The Single Premium (SP) paid by you, after deducting the Premium Allocation Charge is invested in the Fund(s) as chosen. You can choose to invest in 4 Funds - Return Guarantee Fund, Bond Fund, Equity Fund and P/E Managed Fund.

RGF has close ended sub-fund(s), open for subscription for a maximum period of 3 months. This has a fixed termination date which is 10 years from the start of the subscription period of this sub-fund. As a result, your actual investment period in RGF may be up to 3 months less than 10 years.

At termination of sub-fund, we will allocate the proceeds from the RGF which will be the Fund Value at the higher of the prevailing NAV or the minimum pre-specified guaranteed NAV. For example, if the minimum pre-specified guaranteed NAV of a RGF sub-fund is Rs. 18 and NAV of RGF prevailing at termination of sub-fund is Rs. 20 then the Fund Value on the date of termination of sub-fund will be calculated on NAV of Rs. 20. And, if the NAV of RGF prevailing at termination of sub-fund is Rs. 15 then the Fund Value on the date of termination of sub-fund will be calculated on NAV of Rs. 18, i.e. at the pre-specified guaranteed NAV.

You will have a choice of Funds to allocate the proceeds of the RGF. If you do not exercise this choice, these proceeds will automatically be allocated to the Bond Fund

The customer also have added protection by choosing Accidental Death Benefit Option.

Maturity Benefit:

• On survival of the Life Assured up to maturity, the Fund Value shall be paid in a Lump Sum.

If the Policy Term is such that the maturity date is the same as the termination date of RGF, then the Fund Value at maturity will be:

*Fund Value at the prevailing NAV as on date of Maturity for the Market Linked Return Funds Plus

* Higher of the Fund Value at the minimum pre-specified guaranteed NAV or at the prevailing NAV for the RGF.

If the Policy Term is such that the maturity date is later than the termination date of RGF, the maturity value is the total Fund Value at maturity.

• Alternatively, the maturity benefit can be availed in installments under 'Settlement' option, which helps you to get periodic installments of your maturity proceeds within five years from the date of maturity. During the settlement period, the Fund Value will remain invested in the existing Funds (other than RGF) as per the prior allocation. The investment risk is continued to be borne by the Policyholder. No charges except Fund Management Charges will be applicable. Partial Withdrawals and switches are not allowed during this period. At any point of time, if you ask for payment of remaining Fund Value the same will be paid immediately. In case of death before the end of the settlement period, remaining Fund Value is payable immediately as a Lump Sum to the nominee/beneficiary (e.g. legal heir). The Policyholder can choose to opt for payments in instalments, with two months prior notice to the Company.

Death Benefit:

Higher of the Fund Value or Sum Assured is payable; with a minimum of 105% of the Single Premium paid. Sum Assured and amount equal to 105% of the Single Premium paid will be reduced to the extent of Partial Withdrawals made in the last 24 months for age at death below 60 years and for age at death 60 years & above all Partial Withdrawals made from 58 years onwards.If you have