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Company profile of HDFC
standard life
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8/26/2010

ADIT SARIN

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PGD FM 09/017

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SUBMITTED TO-MR HARIHARAN

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COMPANY PROFILE:

Incorporated in 1977 with a share capital of Rs. 10 cores, HDFC have since emerged as
the largest residential mortgage finance institution in the largest residential mortgage
finance institution in the country. The corporation has had a series of share issues raising
its capital to Rs.119 cores. The net worth of the corporation as on March 31, 2000 stood at
Rs. 2096 cores.

HDFC operates through 75 locations throughout the country with its Corporate head
Quarters in Mumbai, India. HDFC also has an international office in Dubai, U.A.E., with
service associates in Kuwait, Oman and Qatar.
 3

Standard Life is Europe's largest mutual life assurance company. Standard Life, which has
been in the life insurance business for the past 175 Years, is a modern company surviving
quite a few changes since selling its first Policy in 1825. The company expanded in the
19th century from its original
Edinburgh premises, opening offices in other towns and acquiring other Similar
businesses.

Standard Life currently has assets exceeding over $119 billion under its management and
has the distinction of being accorded "AAA" rating consequently for the past six years by
Standard and Poor. They have assets under management which are worth more than the
market value of Sainsbury's Boots, Tesco, Cadbury Schweppes and Marks and Spencer
combined.

HDFC standard life insurance is backed by HDFC, the reputed housing financial
institution operating since several decades and Standard Life Assurance Company, one of
 4

The Partnership

the Europe's largest mutual fund company HDFC has 30000 crores of assets and Standard
Life has $119 billion of assets so they can comfortably consider has safe as insurers.

Your Family, Their Future, Our Help

HDFC are the main shareholders in HDFC Standard Life with 81.4% stake while Standard
Life owns 18.6%. The company is one of the top three performing companies in the
industry. They have tie ups with various banks like Indian bank, Union bank and Kochi
based JRG Financial Services Pvt Ltd. On its bank assurance tie up with Union bank of
India, the bank has been selling HDFC Standard Life products across the country through
its branches. HDFC Standard Life has the widest distribution network among all the
private insurance companies with the presence in 53 locations. HDFC Standard Life
Insurance Company Ltd recorded a 120% growth in the collection of new business
premium over the previous year.

HDFC and Standard Life first came together for a possible joint venture, to enter the Life
Insurance market, In January 1995.it was clear from the outset that both company shared
similar values and beliefs and a strong relationship quickly formed. In October 1995 the
company signed a 3 year joint venture agreement. Around this time Standard Life
purchased a 5% stake in HDFC, Further strengthening the relationship. The next 3 years
were filled with uncertainties, due to changes in government and ongoing delays in getting
the IRDA (Insurance Regulatory and Development Authority) Act passed in parliament.
Despite this both companies remained firmly committed to the venture. In October 1998,
 5

the joint venture agreement was renewed and additional resource made available. Around
this time Standard Life purchased 2% of Infrastructure Development Finance Company
limited.(IDFC).
Standard Life also started to use the services of the HDFC Treasury department to advice
them upon their investments in India.

Towards the end of 1999, the opening of the market looked very promising and both
companies agreed the time was right to move the operation to the next level. Therefore in
January 2000 an expert team from the UK joined a handpicked team from HDFC to form
the core project team, based in Mumbai.

In a further development Standard Life agreed to participate in the Asset Management

Company promoted by HDFC to enter the mutual fund market. The mutual fund was
launched on 20th July 2000.

Incorporation of HDFC Standard Life Insurance Company Limited:

HDFC Standard Life insurance company Limited was the first company to be granted
license by the IRDA to operate in Life insurance sector. Each of the JV player is highly
rated and been conferred with many awards. HDFC is rated 'AAA' by both CRISIL and
ICRA. Similarly Standard Life is rated 'AAA' both by Moody's and Standard and Poor's
.these reflect the efficiency with which HDFC and Standard Life manage their asset base
of Rs .30000 Cr and RS.600, 000Cr respectively.

The company was incorporated on 14th August 2000 under the name of HDFC Standard
Life Insurance Company Limited.

Our ambition as far back as October 1995 was to be the first private company to re-enter
the life insurance market in India. On the 23 of October 2000, this ambition was realized
when HDFC Standard Life was the only life company to be granted a certificate of
registration.
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HDFC are the main share holders in HDFC Standard Life, with 81.4%, while Standard
Life owns 18.6%. Given Standard Life's existing investment in the HDFC group, this is
the maximum investment allowed under current regulation.

HDFC and Standard Life a long and close relationship built upon shared values and trust.
The ambition of HDFC Standard Life is to mirror the success of the parent companies and
be the yardstick by which all other insurance companies India are measured.

Service:
It has employed well-equipped and trained consultants to whom question can be asked for
any policy purchased or any other queries.
 7

MISSION OF THE COMPANY

The company aim is to be the top new life insurance company in the market.

This does not just mean being the largest or the most productive company in the market.
Rather it is a combination of several things like-

• Customer service of the highest order

• Value for money for customers
• Professionalism in carrying out business
• Innovative products to cater to different needs of different customers
• Use of technology to improve service standards
• Increasing market share

VISION OF THE COMPANY

“The most successful and admired life insurance company, which mean that we are the
most trusted company, the easiest to deal with, offer the best value for money, and set the
standards in the industry.”

“The most obvious choice of all.”

VALUES OF THE COMPANY

SECURITY: providing long term financial security to its policy holders will be co's
constant endeavor. It will be doing this by offering life insurance and pension products.

TRUST: Co appreciates the trust placed by its policy holders in it hence; Co will aim to
manage their investments very carefully and live up to this trust.
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INNOVATION: recognizing the different needs of customer, Company will be offering a

range of innovative products to meet these needs.

Strategic objectives of the insurance companies:

As a leading insurance company, we are committed to providing the best possible service
for our clients. Since the establishment of the company, we have set a number of long
term strategic goals.
We are keen to achieve. On top of our goals is to build a strong loyal customer base that
we always try to enrich by providing the best services at competitive costs. We have
broadened our range of services over the years, in order to reach out for more customers
and meet their precise needs.

One of the main objectives of the company is to maintain a stable financial position in the
market along with a stable growth in capital over the years.

To be able to compete in a fast emerging market, we have to keep up with needs of our
clients. Our services are updated according to their demands.
Innovative services were presented according to the needs of the new market. We try to
cover as many sectors as possible using our long experience in the insurance field.
Finally, our achievements and clients speak for us, which proves that we are on the right
track.

Reaching the top is hard... staying on top is the hardest

9
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ORGANISATION STRUCTURE OF THE BRANCH OFFICE

I WORKED:

Branch manager is the head of the branch under whom the whole branch office is dealt
with. Next to the branch manager is the business development managers of 1 or 2 of them.
The sales development manager falls under business development manager but is
accountable to branch manager only. Below the business development manager and sales
development manager are the financial consultants who are not the employees of the
company but the agents who give the business. Operational officer and the agency support
officers are the staff members employed to maintain the inner transactions and to keep
account of all the receipts and payments. Even they are accountable to the branch manager
only.
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Table showing the various individual products offered by HDFC

standard life insurance company:

Plan Benefits
Savings series
Endowment Assurance Plan Life Insurance with Savings

Unit Linked Endowment plan Life Insurance and savings with choice of
investment in funds

Children's plan Financial Security for your child

Money Back plan Life Insurance with Savings

Unit linked young star Life Insurance and savings with choice of
investment in funds
Investment Series
Single Premium Whole Of Life plan Investment with life insurance

Protection series
Term Assurance plan Life Insurance at an affordable
price(i.e. high risk cover with low
premium)
Retirement Series

Personal Pension Plan Savings for retirement

Unit Linked Pension Plan Retirement savings with choice of

investment in funds
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THE VARIOUS GROUP PRODUCTS OFFERED B Y HDFC STANDARD

LIFE:

Group Term Insurance:

HDFC Standard Life offers a Group Insurance scheme for companies called "Group Term
Insurance". This product has been designed to offer innovative features and a high degree
of customization.

Gratuity Plan:

The HDFC gratuity plan is an insurance policy. Which offers you, as an employer and
gratuity scheme trustee, a new and flexible way to fund your gratuity liability? The
contributions that you decide to invest in this policy will assist you in meeting your
gratuity obligations in a systematic manner.

Leave Encashment Plan:

The HDFC leave Encashment plan is a flexible insurance policy, which helps employers,
and leave encashment scheme trustees in funding leave encashment obligations without
the employer's profit and loss account being unexpectedly impacted.

Development Insurance Plan:

This product is well suited for the economically weaker sections of society and caters
specifically to their needs. It makes available life cover at affordable rates.
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Rider:
Rider is not a basic plan offered by the company it is an additional benefit given by
receiving additional premium with the basic plan's premium

Riders Offered By the Company:

1) Critical illness benefit (CI)

This rider pays an additional sum assured on happening of the 6 specified critical
illnesses, along with the sum assured of the basic plan.

2) Additional term benefit (ATB)

Additional Term benefit provides additional sum assured on death during the term of this
rider along with the sum assured of the basic plan.

3) Accidental death benefit (ADB)

This rider pays one extra sum assured on death due to accident.

4) Waiver of premium benefit (WOP)

As the name indicates, this rider waives of future premiums on disability of the
policyholder.

5) Accelerated sum assured (ASA)

This rider accelerates the payment of the basic sum assured on happening of critical
illness (6 specific illnesses).
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VARIOUS PRODUCTS AND OTHER FEATURES:

Savings Series Endowment Assurance Plan:

This plan is with profits saving plan and is well suited for saving money for long term
financial goals. This plan also provides the needs of a family in the absence of incoming
earning capacity of the a family (unfortunate death of earner) by paying out a lump sum in
the event of unfortunate death of policy holder during the term of the policy

Features

 Provides financial support to the family by way of a lump sum payment in case of the
unfortunate death of the life assured within the term of the policy.
 Provides a lump sum payment to the life assured on survival up to maturity of the
policy.
 The lump sum mentioned is the basic Sum Assured plus any bonus addition.
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The Riders Allowed Under the Plan:

• Critical illness benefit (CI)

• Additional term benefit (ATB)
• Accidental death benefit (ADB)
• Waiver of premium benefit (WOP)

Payment options:

Payment of premium can be done either in yearly, half yearly or quarterly modes,
depending on the convenience.

Benefits:
On maturity basic sum assured + Reversionary bonus + Terminal bonus (if any) is paid.

On death basic sum assured + Reversionary bonus + Terminal bonus (if any) is paid along
with the rider benefits if any.

Allowed to: single life as well as joint life first claim basis Eligibility:

Basic policy Rider options with corresponding

eligibility ages chart
CI ATB ADB WOP
Min age at entry 12 18 18 18 18
Max age at entry 60 55 60 55 50
Max age at expiry 75 70 75 65 60

Terms:

Minimum: - 10years
Maximum: - 30years
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UNITLINKED ENDOWMENT PLAN:

MARKET- linked insurance plans (MLP) are fast becoming popular HDFC plans
plays a lump sum either on death or maturity but the returns are directly linked to the
underlying investments.
Term period Age at entry Maximum age at
maturity
Option Min Max Min Max
Life option 10 30 18 60 7
Life and health 10 30 18 55 65
option
Extra life option 10 30 18 55 70
Extra life and death 10 30 18 55 65
option

MONEY BACK PLAN

The plan has a 5 investments options- liquid fund, secure managed, defensive managed,

balanced, and growth fund.

SWICHING OPTIONS:
Policy holder can have the option to switch between funds and also redirect future
premiums into a different fund.

PREMIUM ALTERATION:
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Premium levels can be either reduced or increased .if regular premium have been paid for
3 years or the policy value is at least Rs.15, 000.

WITHDRAWALS:
Withdrawals can be made from the fund any time provided the balance does not fall below
the SA.

CHARGES:
The charge is lower compared to other plans. You can pay minimum premium in the first
2 years and subsequently increase them. the charges in the subsequent years are
substantially lower, even on top ups, moreover, you will not be charged for altering your
premium, switch between funds redirecting your premium into other.

CHILDREN'S PLAN

FEATURES:

The plan can be taken those in the 18-60 age groups with the maximum age at maturity
being 75. The minimum and maximum terms are 10 & 25 respectively. Under this plan,
the payer of the premium is the life insured and child is the beneficiary. Children's plan is
design to provide a lump sum to the child at maturity. It also provides financial security to
the child in the future, incase of insured person's unfortunate death during the policy term.
 18

Policy receives simple reversionary bonuses, which are usually added annually. This is a
flexible plan with three options to choose from .depending on the requirements they are:

Maturity Benefit Plan:

If the life insured die during the term of the plan. The future premiums are waived and the
policy continues till maturity.
On maturity, the beneficiary will receive the sum assured and the accumulated bonuses.
Bonuses under the plan are of reversionary in nature and are on sum assured.

Accelerated benefit plan:

If the life insured dies during the term of the plan. The beneficiary will receive the sum
assured and the accumulated bonuses immediately and the policy terminates. Bonuses
under the plan are of reversionary in nature and are on sum assured.

Double benefit plan:

If the life insured dies during the term of the plan. The beneficiary will receive the sum
assured and the accumulated bonuses immediately and the policy continues till the date of
maturity. The future premiums are waived on maturity, the beneficiary will receive
another sum assured and the accumulated bonuses. Bonuses under the plan are of
reversionary in nature.

This plan helps you plan for future anticipated expenses by paying a periodic cash lump
sum to you at regular intervals

Features:
 19

 Payment of cash lump sum, each of which is a proportion of the basic sum assured at a
5 year intervals during the term of the policy.
 On survival up to maturity, a payment equal to the basic sum assured plus any bonus
addition less the cash lump sum paid earlier is provided.
 In case of the unfortunate death of the life assured with in the term of the policy, the
basic sum, assured plus any bonus addition is provided. This is a cover and above the
earlier pay outs.

OPTIONAL BENEFITS:

The following optional benefits can be added to customize the policy to suit the personal
needs.

 Critical illness benefit

 Additional term benefit

 Accident death benefit
 Waiver of premium benefit.

Eligibility:
 Min, age at entry 12 years
 Max age at entry 60
 Max age at expiry 75 years
 Min term 10 years
 Max term 30 years Payment options

Payment of premium can be done either in yearly, half yearly or quarterly modes,
depending on the convenience.

SINGLE PREMIUM WHOLE OF LIFE INSURANCE PLAN

FEATURES:
 20

 A sound investment: the money is invested in their with profit funds. A compound
reversionary bonus is declared for the policy every year and added to the policy on its
maturity.

 Flexibility of term: even after choosing the policy, you can decide on the policy term.

 Surrender value: the policy can be terminated any time, after it has been in force for
at least 6 months. And receive a surrender value.

 In case of unfortunate death: the nominee gets the sum assured secured by your
premium. Plus any attached bonus.

 No medical benefits: no medical test is required for this plan

Eligibility:

Min, age at entry 18 years

Max, age at entry 70 years

Payment options:
A single premium can be paid by cheque, cash or demand draft.

Indicative premium:

 Minimum sum assured Rs.25, 000

 Maximum sum assured Rs.5.00.000
 Premium 950 per thousand sum assured

PROTECTION SERIES
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TERM ASSURANCE PLAN

Under this plan sum assured is payable in case of death of the assured during the tern of
the contract. One can choose the lump sum that would replace the income lost to one's
family in the unfortunate event o f one's death. Since this is non participating (with
profits) plan is a pure risk cover plan. No benefits are payable on survival to the end of the
term of the policy.

Optional benefits:

 Critical illness benefit

 Accident death benefit
 Accelerated sum assured benefit

ELIGIBILITY:

Basic policy policy with optional benefits

Min, age at entry 18 18

Max, age at entry 60 55

Max age at expiry 65 65

Payment option:
Payment of premium can be done either in yearly, half yearly or quarterly modes or a
single one time premium depending on the convenience.
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LOAN COVER TERM ASSURANCE:

This plan provides a lump sum on the unfortunate death of the life assured during the term
of the policy. The lump sum will be a decreased percentage of the initial sum assured, as
the outstanding loan decreases as per the loan schedule, the cover under the policy
schedule.

Eligibility:

 Min, age at entry 18 years

 Max, age at entry 55 years

 Max, age at expiry65 years

Payment option:

Payment of premium can be done either in yearly, half yearly or quarterly modes, or a
single one time premium depending on the convenience.
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RETIREMENT PLANS

PERSONAL PENSION PLAN:

This plan is basically savings contract, which is designed to provide an income for life
from retirement.

Eligibility:

 Min, age at entry RP -18 sp -35

 Max, age at entry 60
 Min, age at retirement 50
 Max, age at retirement 70

Surrender value:

You can surrender the policy at any time. if premiums have been paid continuously for at
least 3 years. The surrender value will be subject to a guaranteed minimum.

Unit Linked Pension Plan

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The unit linked pension plan is a basically an insurance contract, which is designed to
provide a retirement income for life.

Your premiums are invested in units of the investment fund of your choice based on the
prevailing unit price.

Funds which can be chosen:

 Liquid fund
 Secured managed fund
 Defensive managed fund
 Balanced managed fund

Eligibility:

Min, age at entry RP-18 SP-18 Max age at entry RP 60 SP-65

Min, age at retirement 50

Max, age at retirement 70

Tax Benefits:
Tax benefits under various sections of the Income Tax Act, 1961 are as follows:
 25

** Applicable to premiums paid for Cl, WOP and ASA.

Plan Tax Benefits

Endowment Assurance Sec. 88, Sec. 80D** and Sec. 10 (10D)

Children' s Plan Sec. 88 and Sec. 10 (10D)

Money Back Sec. 88, Sec. 80D** and Sec. 10 (10D)
Single Premium Whole Of Life Sec. 88
Term Assurance Sec. 88, Sec. 80D** and Sec. 10 (10D)
Loan Cover Term Assurance Sec. 88, Sec. 80D** and Sec. 10 (10D)
Personal Pension Plan Sec. 80 CCC

** Applicable to premiums paid for Cl, WOP and ASA.

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