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A

PROJECT STUDY REPORTON

TRAINING UNDER TAKEN AT

HDFC STANDARD LIFE INSURANCE COMPANY LTD.

(Titled)

Recruitment of Financialconsultants

Submitted in the partial Fulfillment for

the

AWARD OF DEGREE OF

BBA(2010-2011)

Submitted to:- University Of Rajasthan ,Jaipur(raj.)

Submitted By:-

TARUN KUMAWAT

BBA III Year

VIDYASTHALI INSTITUTE OF TECHNOLOGY ,SCIENCE AND

MANAGEMENT

Prithviraj Nagar,Maharani Farm,Durgapura , Jaipur(raj.)

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ACKNOWLEDGEMENT

Memories give you the power to collect roses in the winter.

I express my sincere thanks to my project guide Mr. Vimal modifaculty of Vidyasthali for guiding me right from the inspection

till the successful completion of the project. I sincerelyacknowledge him for ascending their valuable guidancesupport for litereature, critical review of the project and aboveall the moralk support for he had provided to me with all stagesof this project.

I would also like to thanks to Mr.Naveen sharma (BranchManager) and Vimal Modi (Professor) for their extreme supporthelp and cooperation throughout my project.

TARUN KUMAWAT

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STUDENT DECLARATION

I here by declare that the project entitled Recruitment ofFinancial Consultants HDFC Standard Life InsuranceCompany Ltd. Vaishali Nagar Jaipur. Submitted in therecruitment for the degree of bachelor of BusinessAdministration to VIDYASTHALI INSTITUTE OF

TECHNOLOGY, SCIENCE AND MANAGEMENT AFFILIATEDTO UNIVERSITY OF RAJASTHAN JAIPUR(RAJ.) is my original workand has not been submitted for the award of any otherdiploma, fellowship or other similar title or project.

TARUN

KUMAWAT

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PREFACE

As a part of course curriculum for a award of BBA,the studentshave to undergo practical traning for minimum 45 workingdays after the 3rd year.

The underlying object of training is to provide the student withpractical aspect of the organizational working and corporateenvironment . such type of traning helps the students to workin a real industrial environment,to gain practical knowledgeand to build confidence. The idea & intention of taking traning

in this field to came up to me because of tremendous changesand scope in insurance services.

As a part of this trend, I took my traning at:

HDFC Standard life insurance company Ltd.Gopalpura, jaipur

This project deals with analysis of various insurance plans suchas protection, investment,pension saving plans of HDFCstandard life insurance company ltd. Even though I tried tomake efforts at my best there may be manymistakes,shortcomings in my project report which I hope will beforgiven by the reader.

TARUN

KUMAWAT

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CONTENTS Page.no

1. Introduction

5

2. Company Profile10

3. Vision and Values of the Company 24

4. Organization Hierarchy38

5. Products of HDFCSLIC Ltd. 73

6. SWOT Analysis74

7. Findings 758. Conclusions 76

9. Suggestion 77

10. Bibliography 78

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INTRODUCTION

What is 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.

All of us are interested in the creation of assets because:

i. All assets have values.

ii. They yield income to the owner.

iii. They meet some other needs of the owner.

iv. They may provide satisfaction of some needs and

also yield income to the owner.

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 assetis 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

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unfortunate event before the completion of its expected

lifetime. The owner and

those deriving benefits from the asset will suffer because the

arrangement to make available its substitute is not yet ready.

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 lossresulting to the asset from such damage or destruction.

Brief 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 19th 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 were transacting life insurance business at that

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time. Thereafter, LIC got the exclusive privilege to transact life

insurance business in India

Purpose and Need for Insurance

Assets are likely to be destroyed or made non-functional

due to accidental 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.

Possibility of damage to asset caused by any peril is the

risk that asset is exposed to. Risk means uncertainty or unpredictability about future

loss or damage, which may or may not happen. This refers

to the losses, which may happen suddenly and

unexpectedly.

We can say that a human life is also an income-generating

asset.

Human life may be lost due to unexpected early death or

become non-functional following sickness or disabilities

cause by accidents.

If this happens by the time one is on the verge of

retirement when his income is about to cease, he might

have made alternative arrangements to meet his needs.

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But if this happens at a younger age when he is not expected

to have made adequate alternative arrangement, those who

are dependent on his income, will suffer. Insurance is

necessary to help those dependent on his income.

Types of Insurance

Basically there are two types of Insurances:

Non-Life Insurance

Life Insurance

INSURANCE

NON-LIFE

INSURANCELIFE

INSURANCE

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--MARINE

INSURANCE

--FIRE

INSURANCE

--MISCELLANEOUS

INSURANCE

VEHICLES

FURNITURE BUILDING

AIRCRAFTS

GENERAL

INTANGIBLES

--ONLY HUMAN LIFE

INSURANCE

INCLUDES IN THIS

CATEGORY

--HUMAN BEINGS

SICKNESS, ILLNESS

AND OTHER

ASSURANCE GIVEN

IN THIS CATEGORY

--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 an asset 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.

Their re-engineering has always centered around the customer

in retail markets on both sides of the balance sheet, i.e. loans

are given to individuals and deposits are accepted from

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individuals. A positive personalized approach towards our

customers' needs has been HDFCs goad and motto. HDFC has

been voted the second 'Best Managed Company in India' after

Infosys in a poll conducted by Asia

money for the year 2000. The book, Global Cases in

Benchmarking by Robert Camp includes a case study on HDFC.

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.

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

Home Loan Services India Pvt. Ltd.

HDFC Realty Ltd.

HDFC Deposits

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http://www.hdfcbank.com/http://www.hdfcsec.com/http://www.hdfcfund.com/http://www.hdfcrealty.com/http://www.hdfcrealty.com/http://www.hdfcbank.com/http://www.hdfcbank.com/http://www.hdfcsec.com/http://www.hdfcfund.com/http://www.hdfcrealty.com/http://www.hdfcrealty.com/http://www.hdfcbank.com/


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HDFC Standard Life Insurance

HDFC Chubb

Intelenet

HDFC Bank Limited

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 and

Medium segmentsAsiamoney Awards

Best Bank in India in 2006Euromoney Awards

HDFC Asset Management Company Ltd.

HDFC Asset Management Company Ltd. (AMC) was

incorporated under the Companies Act, 1956; on December 10,14
http://www.hdfcinsurance.com/http://www.hdfcbank.com/http://www.hdfcbank.com/http://www.hdfcbank.com/http://www.hdfcinsurance.com/http://www.hdfcbank.com/http://www.hdfcbank.com/http://www.hdfcbank.com/


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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

Moddys investor service award for the best performing

fund house for the one year category.

Zurich also received the best performing fund house

award for the three year category.

Home Loan Services India Pvt. Ltd.

Home Loan Services India Private Limited is a wholly owned

subsidiary of HDFC Ltd. The company has been floated as a

distribution arm of HDFC with an objective of offering doorstep

service to prospective clients of HDFC group.

Financial Management: HLSIL offers financial management

solutions in 9 cities and is continuously expanding its reach.

HLSIL employs sales persons across all spectrums of financial

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http://www.hdfcbank.com/http://www.hdfcbank.com/


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management enabling them to meet a range of financial

needs.

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 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.

Motor Insurance

We understand and care for your vehicle beyond just the policyissue and speedy claims. HDFC Chubb's Motor Insurance

product mainly focuses on Motor Package Policy for privatecars & two wheelers.

Home Insurance

With Home Insurance, we will offer you cover for your homeand belongings against fire and burglary. Our Home Insurancewill bring you the convenience of purchase from HDFC's homeloan counters.

Accident & Health Insurance

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Accidents can happen anywhere and at anytime, which is whythe HDFC Chubb Accident and Travel policy is designed toprotect you from the financial consequences. Avail of the GroupAccident Policy, Hospital cash-Accident policy and Business

Travel policy.

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.

Awards

Deloitte Technology Fast 50 India 2005 Program

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Intelenet 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 Program

Intelenet 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 2005

Intelenet 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 both

depositors 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, 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.

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Awards

HDFC has been awarded AAA rating and MAAA rating

for 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.

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

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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 of

individual 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.

Highlights

First life insurance Company in the private sector to get

license from the regulator IRDA.

First life insurance Company to come out with Term

Assurance Plan.

First private life insurance Company to declare bonuses

consecutively for 6 years from inception.

First life insurance Company to introduce open option to

the pension plan policyholders.

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http://www.hdfcbank.com/http://www.google.co.in/imgres?imgurl=http://www.hdfcinsuranceindia.com/hdfc_sl/images_index/lp_top.gif&imgrefurl=http://www.hdfcinsuranceindia.com/hdfc_sl/index.php%3Fref...&usg=__iSu_mWnexG3URdv9d6dZUyhnLuo=&h=391&w=779&sz=132&hl=en&start=31&tbnid=5Cs-FzcO0jo-CM:&tbnh=71&tbnw=142&prev=/images%3Fq%3Dimages%2Bof%2Bhdfc%2Blife%2Binsurance%2Bplane%26start%3D20%26um%3D1%26hl%3Den%26sa%3DN%26tbs%3Disch:1&um=1&itbs=1http://www.google.co.in/imgres?imgurl=http://media1.delhi.88db.com/del/DB88UploadFiles/2009/04/08/A75B9AE4-B3E5-4564-AB62-B8C3A116D805.jpg&imgrefurl=http://in.88db.com/delhi/q-Best%2520Health%2520Insurance/1/&usg=__aZ14ZBsQo7MT2vqhdw1EK1Usb-w=&h=428&w=428&sz=111&hl=en&start=9&tbnid=N7hqxXZp4wzJGM:&tbnh=126&tbnw=126&prev=/images%3Fq%3Dimages%2Bof%2Bhdfc%2Blife%2Binsurance%2Bplane%26um%3D1%26hl%3Den%26sa%3DN%26tbs%3Disch:1&um=1&itbs=1http://www.hdfcbank.com/


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First life insurance Company to introduce Automatic

Allocation Option to all the policyholders under Unit Linked

Plans.

Only life insurance Company to give 24 free switching

option to Unit Linked Policyholders.

HDFC is one of the fastest growing Private Life Insurers

and today have more than 8 lakh policyholders.

HDFC have one of the widest networks with more than

160 branches and servicing over 440 towns.

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 consecutive

years.

Voted as the Most Respected Life Insurance Company

by Business World in 2004.

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+ STRENGT =

Financial Expertis

22

Market leader

in the Housing

Finance Sector

Over 2 million

satisfied

customers

Over 1,00,000

Crores in Loan

Approvals

Ranked as

Indias 3rd Best

Managed

Company by

Finance Asia-

2005

Serving

customers for

over 180 years

Currently

administers

125 billion in

assets

Voted 5 Star

Life &

Pensions

provider forlast 10 years

250 Branches

11,00,000

Customers

Multiple

Products

- Protection

- Unit Linked

- With Profit

More than

8 lakhpolicyholders

Servicing over

440 towns in

India


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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.

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.

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VISION & VALUES

VISION & VALUES

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Our Vision

The most successful and admired LifeInsurance Company, which means that weare most trusted company, the easiest todeal with, offers the best value for money,

and set the standards in the industry. Inshort, The most obvious choice for all.

Values

IntegrityInnovation

Customer CentricPeople CareTeam Work

Joy & Simplicity


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BRANCH PROFILE OF HDFCSLIC, VAISHALINAGAR

HDFC Standard Life Insurance Companys branch at Vaishali

Nagar, 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. Vaishali Nagar, 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 Managers Mr. Naveen Sharma

(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 10-16 Sales

Development Managers (SDM), who takes the responsibility of

promoting and selling of HDFCSLICs products.

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ORGANIZATION HIERARCHY

hhhhjhlh

Mr. Sumeet Chugh (TM)

Mr. Rajesh Gupta

BM, Jaipur-IV

Mr. Utkarsh Upadyaya

BM, Jaipur-V

Mr. Chandra S. Paliwal

ABM, Jaipur-IX

26

Mr. Siddarth Singh

BM, Jaipur-III

SDM

Ajay Agarwal

Ashish Kedawat

Kanishk Dutt

Rahul Chandal

Ram K. Khandelwal

Ritu Mathur

Rohit Khanna

Pancham Sharma

Shashikant Sharma

Preet Pal Singh

Ramit Chawla

Pankaj Batra

SDM

Mahendra K. Bairwa

Atin Bhargava

Roop C. Lakhera

Neeraj Pareek

Ashish Pareek

Kapil Chaudhary

Atul Rajwanshi

Payal Singhal

Ajay Narain

Mahendra Singh Pal

Mithun Tailor

Dharmendra Prasad

SDM

Arad Ullah Khan

Mohit Pareek

Harish Kumar Dabi

Abhishek Sharma

Dharmendra Saxena

Puneet Wadhwa

Ajay Sharma

Akhil Mathur

Arun Singh

SDM

Ashish Saraswat

Pranaya Sharma

Nisha Jain

Naveen K. Verma

Varun Bhatnagar

Abdul Haseeb

Kuldeep Kumawat

Bal K. Upadhayaya


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LIFE INSURANCE PLANS

Life insurance plans can be compared to medicines. No one pill

can cure all the diseases; one insurance plan can also not

provide the solution to all financial problems. One has to use a

combination of plans to arrive at an insurance solution. Taking

the right medicine for the disease is important, similarly taking

the right kind of insurance plan is important to achieve

financial goals. Medicines can be administered by different

methods like pills, injections. Life insurance plans are also

come in with-profits and unit linked options.

Life Insurance Plans are a means to achieve a solution to the

clients financial needs.

Creating Wealth Childrens Education

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28

An average suburban property

costs Rs. 15 Lakh

--Outlook Money

To study for an MBA & associated

expenses, today you would require inexcess of Rs. 6 lakh

--Outlook Money Statistics

Retirement Standard of Living

96 out of 100 Indians do not

have any provision

--World Bank Report

If you are currently earning

Rs. 20,000 p.m. & inflation is at 5%, you will

need an income of Rs. 53,065 p.m. in 20

years time to maintain your current standard

of living

--Outlook Money Guide, 2005


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Retirement

P.I.P.S.

Classification of life insurance plans

29

Serious Illness Premature Death

It will cost Rs. 2 lakh

For open heart surgery & Rs. 18

lakh for a liver transplant--Brand Equity Foundation

More than a quarter

Of Indians do not reach the age of

60--World Health Organization


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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.

The premium collected under this category of plans is generally

sufficient to cover the risk insured. There is no return of

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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 plans can be explained with the following diagram...

Fig 1: The policyholders pay the premium, which goes into a

fund. This fund is sufficient enough to pay all the claims that

arise and meet all the expenses.

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 issufficient 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

31

Death ClaimsPremium

Expenses

Fund sufficient to

pay claims to

meet all expenses

Policyholder


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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 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 financialresponsibility. 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 theinsured

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event as defined occurs. Rider benefits usually come with a

number of exclusions.

HDFC Standard Life Company has two products in this category

and they are:

1. Term Assurance Plan

2. Loan Cover Term Assurance Plan

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 of the 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.

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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 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

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client depend on the movement of the Net Asset Values (NAVs)

of the units purchased.

The functioning of a with-profits investment plan can be

explained with the following diagram:

Fig 2: The policyholder pays the premium, which is invested by

the insurance company. The returns are distributed to the

policyholder by means of bonus mechanism, which tries to

achieve a smoothening of the returns.

The Single Premium Whole of Life Insurance Plan (SPWLIP) of

HDFC Standard life falls in this category of products.

Pension PlansPension Plans are designed to provide pension. With the

interest rates fluctuating and the increase in longevity the

interest in the pension products has been growing in the recent

past. Life pensions provide

an income till death and this is attractive in the above

mentioned scenario.

35

Sum Assured plus bonus on death/maturity

Investment Returns

ExpensesPremium

Investments

With Profits Fund

Policyholder


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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

the pension fund during his earning years and convert the

fund into pensions on the chosen retirement date.

2. Immediate Pension Plans These plans pay a pension

immediately after the lump sum purchase price is paid to

the insurance company.

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

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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.

The figure below helps to understand how the pension policy

works:



37

Sum Assured plus bonus used to purchase

annuity at the end of the term. In event of

death during the term of the contract the

premium is returned with interest.

Investment Returns

ExpensesPremium

Investments

With Profits Fund

Policyholder


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policyholder by means of bonus mechanism, which tries to

achieve a smoothening

of the returns. On the chosen date of retirement the fund is

used to purchase an annuity. In the event of death of the life

assured during the term the premiums are returned with

interest.

HDFC Standard Life launched the following plans in this

category:

1. Personal Pension Plan (with profits)

2. Unit Linked Pension Plan

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 asavings 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.

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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.

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 bigger due to the effect of compound

interest

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.

The following diagram can explain the working of the savings

plan.

39

Sum Assured plus bonus on death/maturity

Investment Returns

ExpensesPremium

Investments

With Profits Fund

Policyholder


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policyholder

by means of bonus mechanism, which tries to achieve a

smoothening of the returns.

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 followingsavings 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 Plan

Savings 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.

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Consequently the needs keep on increasing and often increase

at a 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-termevents, 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 policywould terminate on payment of the death benefit.

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b) Maturity Benefits: On survival of the life assured tillthe 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.

c) Paid-up Benefits: In case the policyholder

discontinues payment 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

the policy 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 threeyears, he would be entitled for a surrender value.

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.

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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

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

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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:

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.

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2. Money Back Plan

Plan 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 the plan 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


1. Benefits :

a. Death Benefits: In the event of death of the life




with reversionary bonus and the terminal bonuses (if

any) would be paid to the beneficiary.

b. Survival Benefits: Survival benefits are paid at the

end of every fifth year on survival of the life assured.

The rates of survival benefits are given below. The

policy would continue after payment of the survival

benefit.

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c. Surv

c. 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) less all survival benefits

paid during the term of the contract. The policywould terminate on payment of the maturity benefit.

d. Paid-up Benefits: In case the policyholder




paid-up benefits are payable on death of the lifeassured 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



of three years

premium the surrender value would be equal to zero

and nothing would be payable.





the contract.

3. Days of grace:The premium is payable in advance and should be paid





4. Lapsation:

In the event the premium is not paid within the days of






date of lapse only.

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5. Minimum premium:


the Money Back Plan.














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:

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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:




of the Income Tax Act 1961.

The plan is also approved under the provisions of section

80 DD of the Income Tax Act 1961.

3. Childrens PlanPlan designed for the benefit of children

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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

and education. This need is mostly met from the

income of the parent

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

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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


1. Benefits:

a) Death Benefit: Under this option on death of the life

assured 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 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 life assured during the tem of the policy,

provided the premium is paid till the date of death.

c) would be payable immediately to the beneficiary and

the policy would terminate.

d) Double Benefits: Under this option on death of the

life assured during the term of the policy, provided

the premium is paid till the date of death; one sum

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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

e) Maturity Benefits: In the event of survival of the life


provided all the premiums are paid, the sum assured,

together with the reversionary bonuses and the

terminal bonuses (if any) would be paid to the

beneficiary. The policy would terminate on payment

of the maturity benefit.

f) Paid-up Benefits: In case the policyholder



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.

g) Surrender Benefits: The policyholder can surrender





the policyholder

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chooses to surrender after three years, he would be

entitled for a surrender value.





the contract.

3. Days of grace:

The premium is payable in advance and should be paid





4. Lapsation:




paid for at least

three years. In case premiums are not paid for three years

the policy would lapse without value.


date of lapse only.

5. Minimum premium:


the Childrens Plan.

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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.


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 joint life basis.

9. Tax benefits:



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80 DD of the Income Tax Act 1961.

4.Term Assurance Plan

Protection of Income

Introduction

The Term Assurance Plan is a without profits protection

contract designed 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.

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

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insurance of income and hence the existence of liabilities is not

the basis of granting the insurance.

Features of the Term Assurance 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

b) the sum assured is paid.

Benefits on expiry of the cover: On expiry of the cover

nothing is payable as Term Assurance is designed forprotection 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.


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.

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3. Days of grace:



the plan are 15 days from the due date of premium.

4. Lapsation:


grace the policy lapses. A lapsed policy can be reinstated

within one year from the date of lapse only

5. Minimum premium:


the Term Assurance Plan.

Single Premium Rs. 2000






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.

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The Term Assurance Plan can be sold on a single life or

joint life first death basis.

9. Tax benefits:



benefits would

also not be taxable as per section 1010 D of the Income

Tax Act 1961.

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 rate applicable to men three years younger.

5. Loan Cover Term Assurance PlanProtection 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

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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.

Features of the Loan Cover Term Assurance 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.


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:


within the days of grace. The days of grace allowed underthe plan are 15 days from the due date of premium.

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In case the days of grace end on a holiday then the

premium has to be paid on the next working day.

4. Lapsation:


grace the policy lapses. A lapsed policy can be reinstated

within one year from the date of lapse only.

5. Minimum premium:


the Loan Cover Term Assurance Plan.







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:



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The Term Assurance Plan can be sold on a single life or

joint life first death basis.

9. Tax benefits:





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 rate applicable 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. It is important that the client

compares the outstanding loan amount with the rate of

decrease of the sum assured and chooses an appropriate

cover.

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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 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 condition

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,

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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.

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


1. Benefits:

a) Death Benefits: In the event of death of the life




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 Life

Insurance Plan is a whole life plan and therefore does

not have a maturity date.

c) Paid up Benefits: This is not applicable to the Single

Premium Whole of Life Insurance Plan since the plan

is a single premium plan.

d) Minimum Guaranteed Surrender Benefits: On

surrender of the policy after a period of three years

from the date of

e) commencement, there is and guarantee that the

minimum surrender value would be equal to 50% of

the premium paid, except in the four weeks

immediately following the completion of the 10th

policy year.

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f) Special Surrender Benefits: The Company at its sole

discretion 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.


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,


Minimum Sum Assured Rs. 25,000

Maximum Sum Assured Rs. 50,00,000

Minimum Age at Entry 18 yearsMaximum Age at Entry 70 years

5. Policy loans:





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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 rebateunder section 88 of the Income Tax Act 1961.


80 DD of the Income Tax Act 1961

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 abetter 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 recentyears.

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

that the single instrument covers the retirement need of

the client.

II. The deferred pension plan automatically vests in the life

assured 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


1. Benefits:

a) Death Benefits: In the event of death of the life

assured during the term of the contract the following

amount would be payable:

i. In the event of the death of the life assured in

the first 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 bonus

attached would be payable under single

premium policies.

Lower of the sum assured plus

reversionary bonus and return of

premium paid with interest of 8% is

payable, under regular premium policies.

b) Benefits at Vesting: On the vesting date, provided

the policy is in full force the Notional Cash Value

(NCV) would be used to pay the following:

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i. Cash lump sum to the extent permitted by the

regulations at the time of vesting. The

policyholder may 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

choice of the policyholder. In case the

policyholder has opted for the cash lump sum

the balance NCV would be used to purchase the

annuity. In case the policyholder has not opted

for the cash lump sum

iii. then the full NCV would be used to purchase the

annuity.

c) Paid up Benefits: In case the policyholder




paid up benefits would form the 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





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the policyholder chooses to surrender after three

years, he would be entitled for a surrender value.


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:




case the days of grace

end on a holiday then the premium has to be paid on the

next working day.

4. Lapsation:






A lapsed policy can be reinstated within one year from thedate of lapse only.

5. Minimum premium:


the Personal Pension Plan.




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6. Maximum premium:

The following are the maximum premium conditions under

the Personal Pension Plan.

Single Premium Rs. 50,00,000

Annual mode Rs. 50,00,000

Half yearly mode Rs. 25,00,000

Quarterly mode Rs. 12,50,000






Minimum Vesting Age 50 years

Maximum Vesting Age 70 years


between 10 to 40 years, subject to the minimum and

maximum vesting age.

8. Policy loans:



The Personal Pension Plan can be offered on a single life

basis only.

10.Tax benefits:

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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.

SWOT ANALYSIS

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STRENGTH

Country WideRecognition

Need BaseAnalysis

Same Standard

Services in allBranches

Fair Deal in allTransactions

Customers CentricApproach

Infrastructure

WEEKNESS

Frequent JobRotation

Less number ofadvertisements

Hidden Charges


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FINDINGS:

1. In HDFC SL I feel that Insurance sector is one of the most

growing sectors among all sectors in India.

2. I also find that HDFC Standard Lifes Traditional Plans arevery useful for a normal person.

3.Jaipur is one of the most growing city and there is lot ofscope of insurance.

4. Most of the people are aware of traditional plans.

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OPPORTUNITY

Scope in Jaipur asit is in thedeveloping phase

Only 25% ofinsurable peoplehave anyinsurance

Higher possibilityof growth in Indianshare Market

THREAT

LICs Brand Name

People of Jaipurprefer short-terminvestment ratherthan in insurance

Upcoming privateinsurancecompanies.


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5. Electronic media has proved to be very beneficial for peopleto understand about the insurance.

6.There is lot of opportunities for young and energetic peoplein HDFC SL to build there sound career.

7. HDFC Standard Lifes traditional plans like children plan, oneof the most popular product of the company.

CONCLUSION

HDFC is the leading insurance service providers to public

and private sector. HDFC Standard Life is the first private

insurance company 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.

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Traditional plans like children plan gives invaluable support

to your child, Term Assurance Plan gives