INTRODUCTION TO INSURANCE

1.1 INSURANCE: Insurance is not necessarily an investment from which one expects to get ones money back nor is it gambling. A gambler takes risk, while insurance offers protection against risk that already exists. Insurance is a way to share risk with others. Insurance is a cover used for protecting oneself from the risk of a financial loss. It is important to understand that risk is a part of any persons life and that it increases as a person increases in age, responsibility and wealth. Insurance is risk coverage against financial losses and should not be taken as an investment instrument. Insurance is a contract between two parties - the insurer and the insured. The insurer is the insurance company who will provide the cover to the insured against any financial losses. The insured may be an individual person or a group of people like an employer, members of a society, etc. A policy is the contract between the insurer and the insured, which states the risks covered, the exclusions, if any, and the benefits reimbursed on the happening of an event like death, illness etc. The policy is paid through what is called a premium, which is a set amount that must be paid by the insured on a monthly, semi-annual or annual basis. On the happening of an event like death, disability, fire, etc, for which the insured is covered, the benefit amount stated in the policy contract can be claimed by the insured.

Insurance is mainly of two types: Life insurance and General insurance. INSURANCE

LIFE INSURANCE TERM WHOLE LIFE ENDOWMENT PENSION

GENERAL INSURANCE MOTOR MARRINE FIRE HEALTH

LIFE INSURANCE: Under this type of insurance, the corporation guarantees to pay a certain sum of money to the policyholder on reaching a certain age or on his death, whichever is earlier. Life insurance has an element of both of protection and investment. GENERAL INSURANCE: It includes all other types of insurance except life insurance as fire insurance, marine insurance, accident insurance, burglary, fidelity, third party, workmen compensation, consequential loss etc. Under this type of insurance, the insurer undertakes to indemnify the loss suffered by insured on happening of a certain event inconsideration for a fixed premium. LIFE INSURANCE: Risk cover for financial loss in death, disease, disability and destitution. Product aims mainly at person/family. individuals. Long- term contract. Other benefits as Riders. Short-term contract. Combination of various policies possible. GENERAL INSURANCE: Risk cover for loss due to variety of Contract o f indemnity. Product aims at both institutions

1.2 HISTORY OF LIFE INSURANCE

Life Insurance started in 1583 in England. It started in 1870 in India. Government exercised control over the Insurance sector by passing Insurance Act in 1912. It was amended in 1938 therefore, the Act is known as Insurance Act, 1938. In 1956, Life Insurance business nationalized. In 1999, the Insurance sector was opened for private players. IRDA was formed in place of controller of Insurance by passing an Act i.e. IRDA Act. Insurance is contribution by many to share lose too few. Insurance is an important tool in reducing social security cost. Insurance also plays an important role in the economic development.

Principles of Insurance
1. Utmost good faith. 2. Insurable interest. 3. Principle of indemnity.

1.3 LIFE INSURANCE COMPANIES IN INDIA

Following is the list of life insurance companies operating in India: 1. Life Insurance Corporation of India 2. Bharti AXA Life Insurance Company Ltd 3. Aviva Life Insurance Company India Limited 4. Bajaj Allianz Life Insurance Company Limited 5. Birla Sun-Life Insurance Company Limited 6. HDFC Standard Life Insurance Co. Limited 7. ICICI Prudential Life Insurance Co. Limited 8. ING Vysya Life Insurance Company Limited 9. IDBI Fortis Life Insurance Company Ltd. 10. Max New York Life Insurance Co. Limited 11. MetLife Insurance Company Limited 12. Kotak Mahindra old mutual Life Insurance 13. Reliance Life Insurance Company Limited. 14. SBI Life Insurance Company Limited 15. Sahara India Life Insurance Co, Ltd. 16. Shriram Life Insurance Co, Ltd. 17. TATA AIG Life Insurance Company Limited 18. AMP Sanmar Assurance Company Limited 19. Dabur CGU Life Insurance Co. Pvt. Limited 20. Future General India Life Insurance Company Limite

1.4 OVERALL INSURANCE BUSINESS PROCESS

Actuarial Evaluation

Market Research

IRDA Approval

Product Development Sales & Marketing Product Positioning Advertising

Competition

Customers

Field and Other Channel Sales

Underwritin g

Policy Issuance

Claims Experience

Policy Servicing/Claims

2.1 BAJAJ ALLIANZ LIFE INSURANCE CO. LTD.

Bajaj Allianz Life Insurance Co. Ltd. is a joint venture between Bajaj Auto Ltd. & Allianz AG of Germany. Both enjoy a reputation of expertise, stability & strength. Incorporated on 19 Sept. 2000 Bajaj Allianz Life Insurance Co. Ltd. received the Insurance Regulatory & Development Authority (IRDA) certificate of registration (R3) on 2 May 2001 to conduct life insurance business (including health insurance business) in India. The company has an authorized & paid-up capital of Rs. 110 Cores. Bajaj Allianz is poised for an accelerated growth in the market and has already become the fastest growing private life insurance company in India. Bajaj Allianz has also forged strong Banc assurance & continues to build on new tie-ups for fast track growth & deep market penetration. Bajaj Allianz Life Insurance Co. boasts of a nationwide presence with 876 offices and over 4 million satisfied customers. India offers convenient premium payment and receipt options the payments can be direct ,through cheques, demand drafts or directly from your accounts or through credit cards the premium can also be paid on online the insurance policy holders who also have on account with standard chartered bank can and the direct debit mandate facility. Its core business and focus is insurance. With 102.6 billion of revenue during 2007, Allianz is the largest international insurance and financial services organization in the world. Allianz is also the principal sponsor of the Swiss Open tennis tournament and owner of Gornik Zabrze great football team.

2.2 HISTORY OF ALLIANZ Allianz AG was founded in Berlin in 1890 and shifted its headquarters to Munich in 1949. The first step to become an international company started with the opening of a branch office in London in the late 19th century. After World War II, global business activities were gradually resumed. Allianz opened an office in Paris in the late 1950s, and a management office for Italy in the 1960s. These expansions were followed in the 1970s by the establishment of business in Great Britain, the Netherlands, Spain, Brazil and the United States. In 1986, Allianz acquired Cornhill Insurance PLC, London, and the purchase of a stake in Riunione Adriatica di Sicurit (RAS), Milan, strengthened its presence in Western and Southern Europe in the 1980s. Recently, in February 8, 2006, RAS Shareholders approved the mergers with Allianz. In 1990, Allianz started an expansion into eight Eastern European countries with establishing a presence in Hungary. In the same decade, Allianz also acquired Firemans Fund, an insurer in the United States, which was followed by the purchase of Assurances Generales de France (AGF), Paris. These acquisitions were followed by the expansion into Asia with several joint ventures and acquisitions in China and South Korea. Around this time Allianz expanded its asset management business as well by purchasing for example asset management companies in California. In 2001, Allianz acquired Dresdner Bank, a large German bank. Allianz Group and Dresdner Bank combined their asset management activities by forming Allianz Dresdner Asset Management. In 2002 Michael Diekmann succeeded Henning Schulte-Noelle as CEO of Allianz AG. The Allianz Group was reincorporated under a European Company Statute and, as a result of the cross-border merger with RAS, Allianz converted into a European Company (SE - Societas Europaea) in October 13, 2006. Allianz is now present in more than 70 countries with over 177,000 employees. At the top of the international group is the holding company, Allianz SE, with its head office in Munich. Allianz Group provides its more than 60 million customers worldwide with a comprehensive range of services.

KEY FACTS OF ALLIANZ SE: Worlds Largest Insurance Co. by revenue Rs. 520353 Cr (Euro 96.9 billion). Worldwide by Gross Written Premiums Rs. 4 77930 Cr (euro 89 billion). Third largest Assets under Management (AUM) & largest amongst Insurance cos. AUM of Rs 9594200 Cr (Euro 1078 billion). 11th largest corporation in the world. 50% of global business from Life Insurance closes to 0 million lives insured globally. Established in 1890,110 years of Insurance expertise. More than 70 counties, 177,000 employees worldwide. Insurance to almost half of the Fortune 500 cos.

GROWTH Over 2 million (20,79,217) policies in this year-highest amongst all private sector players and taking the number 1 position. Have sold over 3.4 million policies (34, 72,875) issued till date. Largest distribution network to reach the customers across the country with 213000 agents, 900 offices in 840 towns, 200 corporate agents & Bancassurance partners.

2.3 VISION
To be the best insurance company In India to buy from, Work for & invest in

Business focus
To position themselves as a leading corporate and rater insurance company catering to the needs of their customers their guiding principles are customers service and client satisfaction. All their efforts are directed towards understanding the culture social environment and individual insurance requirements or their customers so that they can cater to their valid needs.

2.4 VALUES Customer delights the guiding principle. Ensuring world class solutions and services. Offering customized products. Transparent benefits.

2.5 Organization chart

Kmesh Goyal(CEO)

Sanjay kumar ( Zonal manager)

Ashwani sharma(additional manager)

Anshupuri(divisional manager)

Sales Department

Opreational Department

Mr,parveen Mr. kunaal Mr.Divakar kumar malik singla sharma (BDM) (SBM) (BM)

Mr. Amandeep singh(SM)

Mr.Sandeep kumar(opreational manager)

Mr.Rajvir Singh(CSE)

Mr.Vimal kumar Miss.Amand eep kaur(RE) (accountant)

Agents

Mr.Bhagwant singh(runner)

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 Accelerated Growth: Fiscal Year 2001-2002 2002-2003 2003-2004 2004-2005 2006-2007 2006-2007 No .Of policies sold in FY 21,376 1, 15,965 1, 86,443 2, 88,189 7, 81,685 20, 79,217 New business in FY Rs. 7 cr . Rs. 69 cr . Rs. 180 cr. Rs. 857 cr. Rs. 2717 cr. Rs. 4270 cr.

Assets under management Rs. 5500 cr. Shareholder capital base of Rs. 700 cr.

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2.6 Channels of Bajaj Allianz

CHANNELS OF BAJAJ ALLIANZ

Agency Channel

Banc assurance

Group & Alternate Channel

Branches

Standard Chartered Bank

Employee Benefit

Satellites (643)

Syndicate Bank GE Money

Corporate Agents

Franchisees Direct Marketing Brokers

Urban Co-Op Banks Dist. Co-Op Bank Over 2,00,000 Strong tied Agency Force & Growing rapidly every day

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2.7 Bajaj Allianz has tied up with these banks:-

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2.8 GROWING REACH THROUGH TIE-UPS Bancassurance Pioneered the phenomenon in India-170 Bancassurance partners. One of our core focus areas-tie ups with large national & private sector banks: Standard Chartered Bank. Syndicate Bank. GE money. Tie-up with urban co-op banks, dist. Co-op bank and regional rural banks.

Expanding reach also through tie-ups with large regional banks. Exclusive life insurance products-MRTA & credit shield. Products customized to suit specific needs of banks.

Alternate channels: The strategic alliances group at Bajaj Allianz focus on Group Insurance and Corporate Agency network:

Corporate Agents, Brokers and Franchisees: A constantly growing nationwide network of Corporate Agents, Brokers and Franchisees. A decentralized, dedicated team of professionals to recruit, develop and support Corporate Agents, Brokers and Franchisees.

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Group Business: A growing product range to meet generic and specific needs of various groups. Some of them are Group Term Life, Group Gratuity and Group Super annuation, Group MRTA, GTL in lieu of EDLI, among many others. A dedicated team to ensure nothing but the best in service delivery.

Online Selling and Renewals: Unit Gain plus SP and unit Gain Easy Pension.

Financial services Consultants: A set of expert financial advisors to address comprehensive financial planning needs of high net worth clients.

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2.9 Bajaj group of companies: Bajaj group of companies

Bajaj Auto Ltd. Mukand Engineers Ltd. Bajaj Hindustan Ltd. Bajaj Consumer Care Ltd. Hercules Hoists Ltd. Hind Lamps Ltd. Bajaj Ventures Ltd. Baroda Industries Pvt Ltd. Bajaj Allianz General Insurance Company Ltd. Bajaj Holdings & Investment Ltd. P T Bajaj Auto Indonesia (PTBAI) Mukand International Ltd. Bajaj Electricals Ltd. Bachhraj Factories Pvt. Ltd. Bajaj Auto Finance Ltd. Jamnalal Sons Pvt. Ltd. Jeevan Ltd. The Hindustan Housing Co Ltd. Hind Musafir Agency Pvt Ltd. Bombay Forgings Ltd. Bajaj Finserv Ltd. Bajaj Allianz Financial Distributors Ltd. Bajaj Auto International Holdings BV. Mukand Ltd. Mukand Global Finance Ltd. Maharashtra Scooters Ltd. Bajaj Auto Holdings Ltd. Bajaj Sevashram Pvt Ltd. Bachhraj & Company Pvt. Ltd. Bajaj International.

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2.10 Bajaj Team:

Bajaj Team
Rahul Bajaj Madhur Bajaj Rajiv Bajaj Sanjiv Bajaj Eric Vas Abraham Joseph Pradeep Shrivastava S Sridhar R C Maheshwari Rakesh Sharma C P Tripathi N H Hingorani Kevin P D'sa V S Raghavan S Ravikumar K Srinivas Ranjit Gupta J. Sridhar Chairman Vice Chairman Managing Director Executive Director President (New Projects) President (Research & Development) President (Engineering) CEO (2WH) CEO (Commercial Vehicles) CEO (International Business) Vice President (Corporate) Vice President (Commercial) Vice President (Finance) CEO (Operations, BHIL) Vice President (Business Development) Vice President (Human Resources) President (Insurance, BFSL) Company Secretary

2.11 Competitors of Bajaj Allianz:

HDFC STANDARD LIFE INSURANCE CO. LTD. ICICI PRUDENTIAL LIFE INSURANCE CO. LTD. BIRLA SUN LIFE INSURANCE CO. LTD. ING VYSYA LIFE INSURANCE CO. PVT. LTD. MET LIFE INDIA INSURANCE CO. PVT. LTD. KOTAK MAHINDRA OLD MUTUAL LIFE INSURANCE LTD.
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2.11 SWOT ANALYSIS OF BAJAJ ALLIANZ

S STRENGTH Brand name Product portfolio Customer services

W WEAKNESS Lack of management Communication gap

O OPPORTUNITY Globally expanding business Promoting rural career agents & business. Making environment more conducive

T THREAT .Increased competition Increasing/ decreasing premium rates by competitors. Investment in FDI's.

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2.13 Financial analysis:

Financial analysis refers to an assessment of the viability, stability and profitability of a business, sub-business or project. It the process of identifying the financial strength & weakness of the firm by establishing relationship between the items of Balance Sheet & Profit & Loss Account. The purpose of Financial Analysis is to diagnose the information contained in financial statements so as to judge the profitability & financial soundness of the firm.

Ratio analysis:
This is the study and interpretation of the relationships between various financial variables, by investors or lenders. Ratio Analysis is a technique of analysis & interpretation of financial statements. A ratio in simple sense is defined as the indicated quotient of two mathematical expressions and as the relationship between two or more things. Ratio Analysis is the process of establishing and interpreting various ratios [quantitative relationship between figures and group of figures]. In financial analysis is used as a bench mark for evaluating the financial position of firm.

YEAR RATIOS:Liquidity ratios Current Ratio Debt/Equity Interest Cover Profitability ratios OPM GPM NPM

2008

2007

2006

19.10 11.11 1.35

20.40 10.58 1.30

25.87 10.24 1.30

92.65 92.48 17.82

92.03 91.78 17.82

88.23 87.87 16.52

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Analysis and interpretation of ratios Liquidity ratios:-

o Current ratio:-The current ratio is the ratio of current assets to current liabilities.

Current Assets Current Ratio = -------------------------Current Liabilities Interpretation:-As compare of 2006 or 2007 current ratio is declining in 2008.Due to current liabilities is increasing. o Debt to equity ratio:-The debt to equity ratio is total debt divided by total equity. Total debt = -------------------------Total equity Debt ratios depend on the classification of long term leases and on the classification of some times as long term debt or equity. Interpretation:-As compare of 2007, 2006 companys debt equity ratios is increasing because of company has taken debt from outside.

o Interest coverage ratio:-It indicates the how well the firms earnings can cover the interest payments on its debt. Total debt = -------------------------Total equity

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Interpretation:-As you can see the debt ratio has been increasing, so automatically interest coverage ratio also increasing because we have to pay interest to debenture holder which we lead to increasing in interest in interest coverage ratio.

Profitability ratio:o Operating profit margin:-It show how much cost company is bearing against net sale of goods. Operating profit OPM =-----------------------------------------------------------* 100 Net Sales

Interpretation:-As compare to 2007, 2006 it is increasing. Due to this operating profit has been increased.

o Gross profit margin:- The GPM is measure of the gross profit on sales. Sale cost of goods sold GPM =---------------------------------------* 100 Net Sales Interpretation: GPM is increasing as compare to 2007, 2006. Due to the sale increased.

o Net profit margin: NPM = Net profit ----------------------------* 100 Net Sales Interpretation: There is slight increase in the Net profit in the financial year 2007 as compared to FY 2006. The Net profit remains the same for the financial year 2007-08.
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Introduction to the topic:

Products and services

Life insurance products are usually referred to plans of insurance. These plans have two basic elements. One is Death cover providing for the benefit being paid on the death of the insured person within a specified period. The other is the Survival benefit providing for the benefit being paid on survival of a specified period. Plans of insurance that provide only death cover are called Term Assurance plans. Those that provide only survival benefits are called Pure Endowment plans.

Individual plans Group life plans

INDIVIDUAL PLANS

In our constant endeavor to secure a bright and happy future for u and your family, we offer a range of insurance products that is just perfect for your investment needs. Unit Linked Insurance Plans Traditional Insurance Plans Pension Plans Terms Plans

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TRADITIONAL INSURANCE PLANS

1. INVEST GAIN: An Endowment Plan that helps you save tax and earn more interest.

PRODUCT FEATURE:

Limited premium payment.

PRODUCT TYPE: This is a participating endowment plan (with limited premium payment term option with) minimum guaranteed benefits at maturity or death, whichever is earlier.

ELIGIBILITY & LIMITS:

CONDITIONS

INVEST GAIN ECONOMY

INVEST

GAIN

GOLD,

DIAMOND & PLATINUM Min. age at entry Max. age at entry Max. age at maturity Min. Sum Assured Max. Sum Assured Min. Premium 0 65 70 50,000 No Limit Rs. 5,000 p.a., Rs. 3,000 half yearly, Rs. 3,00quarterly, Rs.700 monthly 18 50 70

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 MATURITY BENEFIT: declared lump sum.

The policyholder will receive the Sum Assured plus

compounded reversionary bonus plus a possible terminal bonus as a

DEATH BENEFIT: Invest Benefits payable in case of death Economy Gain Invest Gold Gain Invest Diamond Gain Invest Platinum Gain

Sum Assured + Double S.A. + Triple S.A. + Quadruple S.A. Accrued bonus Accrued bonus Accrued bonus + Bonus

ADDITIONAL BENEFITS (Riders): o Family Income Benefit (FIB) o Comprehensive Accident Protection (CAP) o Critical Illness Benefit (CI) o Hospital Cash Benefit (HC)

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2. keep.

CHILD GAIN:

Because your child has miles to go and you have promises to

PRODUCT FEATURE: Both lives cover Child and the proposer (Mother/ Father).

PRODUCT TYPE: Right from providing for your childs education to securing a bright future, this plan is tailor made to suit your childs needs.

Funds for critical stages in your childs life like Graduation Post Graduation Marriage. Start a business

Child Gain

Child Gain 21 ChildGain24+

Child Gain 24

Child Gain 21+

STANDARD AGE PROOF: o D.O.B. + MLQ (In case of 0-5 years) o D.O.B. + MLQ + School going certificate (latest) + Signature of child. (In case of 5-18 years)

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 ELIGIBILITY & LIMITS: Eligibility Conditions Min. age of policyholder Max. age of policyholder Min. age of child Max. age of child Max age of child at maturity Min. Sum Assured Max. Sum Assured Min. premium 21, 21 + Plans 20 50 0 13 21 Rs.100000 Rs.50,00,000 24, 24 + Plans 20 50 0 13 24 Rs.100000 Rs.50,00,000

Rs.5,000 yearly, Rs.2,500 half yearly, Rs.2,000 quarterly, Rs.700 monthly.

DEATH BENEFIT: Age Below 7 years 7 to 18 years Above 18 & below 24 years Payout Refund of premium without interest. Sum Assured + Bonus. Payout in lump sum + Bonus.

In case of proposers death 21+, 24+ plans Sum Assured + Riders (at the time of mishappening) 21, 24 plans Riders + Monthly 1% of S. A.

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 ADDITIONAL BENEFITS (Riders): o Family Income Benefit (FIB) o Option to purchase insurance at maturity o Waiver of premium

3.

CASH GAIN:

A plan that adjusts to your lifes needs.

PRODUCT FEATURE:

Money Back Plan

PRODUCT TYPE: This is a regular premium payment participating money back plan with minimum guaranteed benefits at survival on certain year during the policy term (including maturity) or on death whichever is earlier.

ELIGIBILITY & LIMITS: Cash Gain Economy Term Min. age at entry Max. age at entry Max. age at maturity Min. Sum Assured Max. Sum Assured Min. Premium 15 years 15 55 70 50,000 No Limit 20 years 14 50 70 50,000 No Limit 25 years 13 45 70 50,000 No Limit 30 years 12 40 70 50,000 No Limit 18 50 70 50,000 No Limit Cash Gold Gain

Rs.5000 yearly, Rs.5000 h.y., Rs.5000 quarterly, Rs.700 monthly

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 MATURITY BENEFIT:

1st Cash benefit

2nd benefit

Cash 3rd Cash benefit 4th Cash benefit On Maturity

10%

of

Sum 15%

of

Sum 25%

of

Sum 25%

of

Sum 50% of S.A.+ Bonus

Assured

Assured

Assured

Assured

DEATH BENEFIT: Cash Benefits payable in case of death Economy Gain Cash Gain Gold Cash Diamond Gain Cash Platinum Gain

Sum Assured + Double S.A. + Triple S.A. + Quadruple S.A. Accrued bonus Accrued bonus Accrued bonus + Bonus

ADDITIONAL BENEFITS (Riders): o Family Income Benefit (FIB) o Comprehensive Accident Protection (CAP)

o Critical Illness Benefit (CI) o Hospital Cash Benefit (HC)

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4.

PROTECTOR: PRODUCT TYPE:

A Mortgage Reducing Term Insurance Plan.

This is the perfect plan to protect the family from the repayment liability of outstanding loans, in the unfortunate case of death of the loanee. There is also an option to cover the coapplicant of the loan at a very nominal cost under this plan. The asset purchased with the loan continues to be with the family, without any liability for repayment of the loan. Make sure your family home remains with your family for life. The loan protector plan from Bajaj Allianz Life Insurance is a mortgage reducing term assurance plan, which at low premiums helps you to secure your family against home loan. PRODUCT FEATURES: It is an economical way to protect the family from the burden of repayment of the loan in case of death of the loanee . The Plan offers you the convenience of choosing between two premium payment options - Regular Premium Payment & Single Premium Payment. Joint Life availability - the option to cover the co-applicant of the loan under this plan.

5.

RISK CARE: your life.

A plan with Regular/Single Premium payment options to secure

PRODUCT FEATURE: Financial security at lowest cost.

PRODUCT TYPE: This is a non-profit level premium Term insurance plan with additional rider benefits like CIB, HCB, ADB, APT/PDB and in which death benefit is equal to the chosen sum assured (Death Benefit = Sum Assured).

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 ELIGIBILITY & LIMITS: Eligibility Age at Entry Age at Maturity Policy Term Sum Assured Premium Minimum 18 years _ 5 years Rs.4,00,000 Single - Rs.5,000 Regular - Rs.1500 yearly, Rs.1000 half No Limit yearly, Rs.500quarterly, Rs.200 monthly Maximum 60 years 65 years 40 years Rs.50,00,00,000

MATURITY BENEFIT: There are no survival / maturity benefits payable under this plan.

DEATH BENEFIT: Sum Assured is payable, in case of death of the policyholder during the policy term.

ADDITIONAL BENEFITS (Riders): o Accidental Death Benefit o Accidental Permanent Total/Partial Disability Benefit o Critical Illness Benefit (CI)

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UNIT LINKED INSURANCE PLANS

Offering insurance plans with flexibility and tax benefits

When people see how investments in the capital market have grown over the last few years, they prefer to use their funds in ways that help them to participate in the boom in the capital market. Insurers have developed plans that combine the benefits of life insurance as well as giving various options of participating in the growth of the capital market. Such plans are called Linked Life Insurance Plans. They are also called Unit Linked Insurance Plans or ULIPs, in short. A ULIP is a life insurance policy which provides a combination of life insurance protection and investment.

FEATURES: 1. ULIPs provide a lot of flexibility to the policyholder. The option of switching is one provision that gives the flexibility. Policyholders are allowed to switch their money from one fund to another during the term of policy. Some insurers charge a fee for every such switch. Some others allow a certain number of switches free and then charge a fee for every switch thereafter. 2. Policyholders are also allowed to make a lump sum additional contribution at any time i.e. called Top-Up. The risk cover will remain the same, but the amount going into the fund for investment will change. 3. If a person is investing in ULIP, then he gets premium holidays of 2 years if the person is not in a position of paying premium due to some financial problem.

ULIPs and mutual funds In structure, yes but in objective, no. Because of the high first-year charges, mutual funds are a better option if you have a five-year horizon. But if you have a horizon of 10 years or more, then ULIPs have an edge. In the long-term, ULIP managers have several over mutual fund managers. Since policyholder premiums come at regular intervals, investments can be planned out more evenly. Mutual fund managers cannot take a similar long-term view because they have bulk investors who can move money in and out of schemes at short notice.
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 Why do insurers prefer ULIPs? Insurers prefer ULIPs for several reasons. Most important of all, insurers can sell these policies with less capital of their own than what would be required if they sold traditional policies. In traditional policies, the insurance company bears the investment risk to the extent of the assured amount. In ULIPs, the policyholder bears most of the investment risk. Since ULIPs are devised to mobilize savings, they give insurance companies an opportunity to get a large chunk of the asset management business, which has been traditionally dominated by mutual funds. Thus, ULIPs offer better returns than the traditional endowment plans and offer a great deal of flexibility along with great returns making them the finest product offering.

Plans of ULIPs:

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1. NEW FAMILY GAIN: Flexibility in investment for your changing needs.

PRODUCT TYPE:
With Bajaj Allianz New family gain, you can invest in one life insurance plan that can take care of your entire changing requirement. This plan has been designed to provide you with maximum flexibility, so that you do not have to worry about your changing needs.

PRODUCT FEATURES:
It is a unit linked endowment type plan with a minimum term of 10 years and maximum maturity age 70. Guaranteed Life Cover: Sum Assured + Value of Units. Choice of three investment funds today with flexible investment management

ELIGIBILITY:
Conditions Age at Entry Age at Entry with Riders Maturity Age Top-Up Minimum 0 18 5,000 Maximum 60 50 70 25% of regular premium paid till date Policy Term Sum Assured 10 years 5 times or As per need Term/2*A.P. -

whichever is higher Premium Rs. 5000p.a, 2500 half -

yearly, 1250 quarterly

33

 MATURITY BENEFIT: On maturity, the NAV of units in the fund will be paid out and the policy will terminate.

DEATH BENEFIT: Sum Assured + Fund Value

ADDITIONAL BENEFITS (Riders): UL Accidental Death Benefit and UL Accidental Permanent Total/Partial Disability Benefit. UL Critical Illness Benefit and UL Hospital Cash Benefit.

2.

NEW UNIT GAIN SUPER: security. PRODUCT TYPE:

Super financial planning for your familys

Insure fully and get MAX allocation along with a host of additional benefits to choose from. A flexible unit linked plan that allows partial & full withdrawal after 3 years.

PRODUCT FEATURES: Manage your investments: four funds to choose from, with 3 free switches every year. Partial and full withdrawals after 3yrs. Pay top-ups. Reduce regular premium after 2 yrs. Insure fully and get MAX allocation up to 93%
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 ELIGIBILITY & LIMITS: Conditions Age at Entry Age at Entry with Riders Maturity Age Top-Up Minimum 0 18 5,000 Maximum 60 50 70 25% of regular premium paid till date Policy Term Sum Assured 10 years 5 times or As per need Term/2*A.P. -

whichever is higher Premium 25000p.a, 12500 half yearly, 7500 quarterly,

MATURITY BENEFIT: On maturity, the value of units in the fund will be paid out and the policy will terminate. DEATH BENEFIT:

Sum Assured or Fund Value whichever is higher

ADDITIONAL BENEFITS (Riders): UL Accidental Death Benefit and UL Disability Benefit. UL Critical Illness Benefit and UL Hospital Cash Benefit. Four funds to choose from & flexibility to pay top-up any time.

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3. UNIT GAIN PLUS GOLD: The plan that takes care of your insurance and investment requirements for life.

PRODUCT TYPE: Bajaj Allianz Unit Gain Plus Gold aims to meet needs of individuals by clubbing life insurance with market-linked investment. A Unique plan with the combination of protection and prospects of earning attractive returns with investments in various mix of securities that makes a perfect plan to last you a lifetime of prosperity and happiness.

PRODUCT FEATURES: High Allocation upto 85%. Guaranteed Life Cover with a choice of seven Investments Funds.

ELIGIBILITY & LIMITS: Conditions Age at Entry Age at Entry with riders Maturity Age Top-Up Minimum 0 18 5,000 Maximum 60 50 70 Unlimited with top-up sum assured Policy Term Sum Assured Premium 10 years Term/2 * Annual premium As per need -

12000p.a, 6000 half yearly, 1000 monthly

36

 MATURITY BENEFIT: On maturity, the fund value in respect of regular premium and top-up premium (if any) will be paid. DEATH BENEFIT: Sum Assured or Fund Value whichever is higher

ADDITIONAL BENEFITS (Riders): UL Accidental Death Benefit. UL Critical Illness benefit. UL Hospital Cash Benefit. UL Family Income Benefit. UL Waiver of Premium benefit.

4. CENTURY PLUS II: PRODUCT TYPE:

Score a century with your investment plan.

Bajaj Allianz Century Plus II offers you a limited premium payment term option and a unique combination of protection and prospect of attractive returns.

PRODUCT FEATURES: Guaranteed life cover of sum assured plus fund value. 98% allocation in year 1 and year 2 and 100% allocation 3rd year onwards.

37

 ELIGIBILITY & LIMITS: Conditions Age at Entry Age at Entry with Riders Maturity Age Top-Up Minimum 8 18 18 5,000 Maximum 60 50 70 Unlimited with top-up sum assured Policy Term Sum Assured 10 years 10 years

5 times annualized premium

Premium

Rs15000p.a, yearly,

7500

half -

* You can change the premium payment mode on any policy anniversary.

MATURITY BENEFIT: On maturity, the fund value in respect of regular premium and top-up premium (if any) will be paid.

DEATH BENEFIT: Sum Assured + Fund Value

ADDITIONAL BENEFITS (Riders): o Accidental Death Benefit o Accidental Permanent Total/Partial Disability Benefit

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5. invest.

NEW UNIT GAIN: An investment plan that creates value for every rupee you

PRODUCT TYPE: A plan that provides the best returns possible for every rupee you invest.

PRODUCT FEATURES: Partial and full withdrawals after 3yrs (Minimum-Rs. 5,000) Assured Protection even if you miss payment of your premium after 3 yrs

ELIGIBILITY & LIMITS: Conditions Age at Entry Age at Entry with Riders Maturity Age Top-Up Minimum 0 18 5,000 Maximum 60 50 75 Unlimited assured Policy Term Sum Assured Premium 15 Term/2*Annual Premium Males-Rs.10000p.a, half yearly, 20, 25 with top-up sum

5000 -

1000p.m,

Females-7500p.a, 3750 half yearly, 750 per month

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 MATURITY BENEFIT: On maturity, the fund value in respect of regular premium and top-up premium, if any, will be paid and the policy will terminate.

DEATH BENEFIT:

Sum Assured or Fund Value whichever is higher

ADDITIONAL BENEFITS (Riders): o Accidental Death and Disability Benefit o Critical Illness Benefit o Hospital Cash Benefit o Family Income Benefit

Single premium: Bajaj Allianz unit gain plus (sp): The Only Single premium plan that
gives you Maximum Allocation. o 98% Allocation. o Guaranteed Life Cover. o Choice of 5 Investment funds. o 3 free switches allowed everyear. o Partial and Full withdrawls after 3 years. o Now minimum premium as low as Rs10, 000 only.

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Difference between Traditional plans and ULIPs

ULIPs

TRADITIONAL PLANS

The premiums, in excess of risk cover, is All the premiums go into a common fund and invested as desired by the policyholder. are invested at the insurers discretion. of benefitsFor

The investment return may vary depending There are two categories on the market movements and the investment guaranteed risk is borne entirely by the policyholder. and

non-guaranteed.

guaranteed benefits, the insurer bears the investment risk. However, non-guaranteed benefits, such as bonuses, depend on the performance of the insurer.

Withdrawals are allowed.

Surrenders are allowed but at a loss. Loans may be provided.

There are no bonuses, except loyalty bonus For in some cases.

participating

policies,

bonuses

are

payable.

The amount of the premium used for The premium amount used for insurance insurance coverage, other charges and the coverage, other charges and investment are purchase of units are unbundled and bundled up and not known.

transparent. Benefits are variable. Loss is likely. Benefits are pre-determined. Loss is unlikely.

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PENSION PLANS
When you have retired, your golden years can be secure. Live a worry free life. New Unit Gain Easy Pension Plus: Unit Linked Retirement Plan without life cover Swarna Vishranti: Retirement Plan

TERM PLANS
Term Care: Term Plan with Return-of-Premium Risk Care: Pure Term Plan Life time Care: Whole Life Plan

GROUP LIFE PLANS

Bajaj Allianz provides an exciting range of group products which enable organizations to provide protection and care to their members/employees. Group Credit Shield Group Term Life Group Term Life Scheme in lieu of EDLI Group Gratuity Care Group Superannuation Care Small Group Term Life

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REVIEW
REO (2000) With the Indian government on a determined move to push up infrastructure project, the future for project insurance is bright. Insurance risk management inpertise must be tapped by the principal and not merely their after of insurance capacity, at acceptable

rates. The perception of both the buyer of insurance and the sellers of insurance on trading of insurance must be change. They must reappraise their respective professional rates but banks to have a powerful role to influence the range of an insurance program. OHIO (2009) explore in his book Insurance is the subject matter of solicitation Has little relevance to non life insurance products, primarily because, customers have no ambiguity about the product being insurance, and hence scope for misleading information by solicitors. These disclosure regulations may not be construed as detrimental to marketability of insurance products or to be taking the tone of disclaimers. It is in the best interest of insurers and intermediaries to follow these norms voluntarily rather than under compulsion of regulations. GOYAL (2OOO) gives overview on Bajaj Allianz once again revolutionizes the life insurance industry by launching Invest Plus a traditional plan that offers transparency and flexibility of ULIPs with minimum guaranteed investment returns, which is guaranteed at the beginning of the year itself. This is the first of its kind traditional plan that offers upfront minimum guaranteed investment returns at the beginning of each year and an guaranteed maturity value so that customers can feel protected at all times and plan their investments without any worries. SONI (2009) Explore that all investment instruments have their unique set of advantages to offer. It is vital for investors to be aware of the nuances in a particular offering and make informed decisions. When investing in a Unit Linked Insurance Plan, popularly called ULIP, it is to be borne in mind that ULIPs being a market linked instrument will fetch good returns on a long term basis. The basic advantage of a ULIP over other investment instruments is that it offers the twin benefits of life insurance as well as an investment.

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VARADARAJAN (2007) stated that as a parent, securing your childs financial and her life perhaps is top priority. Help is around with life insurers offering products that meet both the goals. These target-oriented plans are suitably tailored for your childs education and her marriage. But like all other insurance products, finding the balance between costs and returns is not easy. CHIDAMBARAM (2007) examined that for handicapped children, LIC offers among others Jeevan Aadhar. Here the guaranteed addition is Rs 100 for every Rs 1,000 sum assured for each completed policy year, which can continue till the parent turns 65. In case the worst happens, the child gets 20 per cent of the accumulation upfront and the rest is used to purchase an annuity. This ensures a handicapped child gets adequate and regular future income. SHANBHAG (2006) Gives an overview on Demand for life insurance policies has increased in the last couple of years. However, people think of insurance policies as a way of investment and PPF (Public Provident Fund), RBI (Reserve Bank of India bonds, equity mutual funds are thought of as investment for adults. But it is not like that. There is no product labeled as `for adults only'. Similarly, children's investment products are not the only products that are meant for children. PRASAD (2006) Explore that Standard Life Insurance, the difference between ULIPs (Unit Linked Investment Plans) and traditional products is the way your money is invested. The companies invest the investible portion of the premium as per IRDA (Insurance regulatory funfests in different asset classes and gives you three to four varieties of funds in one policy. ULIP should be preferred if the investor is inclined towards the market and feels that he should actively participate in fund management. HASSAN AND LAWRENCE (2007) conducted a survey on, An analysis of financial preparation for retirement. This study based on the data from the survey of consumer finances. It applied profit analysis to compare and examine the variables affecting retirement preparation between men and women of the age group 30-39 years. These results revealed that retirement plan eligibility has a significant and negative association with retirement plan.

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BAUER AND FREHEN (2008) analyzed in this study evaluated the pension fund performance. The research revealed that the pension funds have closely performed in relation to its benchmark and multiple components. It was observed that the pension funds are less exposed to hidden agency cost in comparison to mutual funds.

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OBJECTIVES OF THE STUDY

Whenever a study is conducted, it is done based on certain objectives in mind. This study is based on following objectives:

1. To study awareness among the people about Life Insurance.

2. To study the preferences of investors between Unit Linked Insurance Plans and Traditional Plans.

3. To know which ULIPs and Traditional plans are better?

4. To know the frequency of payment made by customer.

SCOPE OF THE STUDY

The report title is Comparative Study of ULIP and Traditional Plans. The report gives an overview of the Insurance Sector and company profile. It also includes history of Bajaj Allianz. The study was conducted to know the preferences of investors between ULIPs and Traditional Plans. The methodology adopted for the study was through a structured questionnaire. For this purpose sample size of 30 was taken. The data collected, is analyzed thoroughly and presented in the form of charts and tables.

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LIMITATIONS OF THE STUDY

The study based on survey through pre-designed questionnaires suffers from the basic limitations of the possibility of difference between what is recorded and what is the truth, no matter how carefully the questionnaire has been designed and field investigation has been conducted. This is because the persons may not deliberately report their true responses and even if they want to do so, they are bound to be differences owing to problems in the communication process. In addition, there are some limitations, which are as below:

Data collection error may be there due to wrong response from respondents as some time they are not the right person who takes actual decisions.

Some of the respondents can hide the real information. Some time people did not have time to fulfill questionnaire, so they give only few information.

A sample size cannot always represent the whole population.

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RESEARCH METHODOLOGY Necessity is the mother of invention Research methodology is a plan of action to be carried out in connection with a research report. The population for the study consists of all the investors who are investing a part of their income in various schemes on financial instruments. The data for the study was collected with the help of structured questionnaires.

RESEARCH DESIGN Research design is the basic framework which provides guidelines for the rest of research process. The survey done for this project conveys Regional information. Scope of survey is limited to Ludhiana City. The research design specifies:-

TYPE OF RESEARCH This is descriptive type of research in which clients has been surveyed to check their preferences regarding the ULIP and Traditional Plans.

METHOD OF DATA COLLECTION There are two methods of data collection. For study both primary and secondary data was collected. o Primary Data: For collecting primary data I used a questionnaire. Under this questionnaire, the questions, which were related to check the customers preference between ULIP and Traditional plans, are included. The data was collected in the field through questionnaires to get the meaningful information not available for secondary data. o Secondary Data: This data was taken from published media and internet.

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SAMPLING UNIT The data was collected from various locations of Ludhiana. Data was collected from businessmen and service class.

SAMPLE SIZE It was decided to restrict the sample to 30 respondents.

CONTACT METHOD I personally interacted with people to fill up the questionnaire so that I may able to complete my survey.

SAMPLE DESIGN For drawing the sample convenient sampling has been used to save time and to meet my Objectives.

STATISTICAL TOOLS Bar, graph diagrams and Pie charts have used to understand the result analysis.

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GENDER (Table1.1)
Particulars Male Female Respondents 26 4

Male

Female

Figure 1.1

Interpretation:There are 26 male respondents and 4 female respondents.

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Income group of customer

Table 1.2

Particulars Below 50,000 50,000 to 1,00,000 1,00,000 to 2,00,000 Above 2,00,000

Respondents 2 22 4 2

25 20 15 10 5 0 Below 50,000 50,000 to 1,00,000 to Above 1,00,000 2,00,000 2,00,000 Respondents

Figure(1.2) Interpretation: Survey shows that there are 2 respondents below 50,000 salary, 22 respondents earn salary 50,000 to 1,00,000, 4 respondents earn 1,00,000 to 2,00,000, 2 respondents earn above 2,00,000.

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Percent of income put in saving. Table (1.3)

Particulars Below 10% 10% to 20% 20% to 30% 30% to 40%

Respondents 9 10 11 0

12 10 8 6 4 2 0 Below 10% 10% to 20% 20% to 30% 30% to 40% Below 10% 10% to 20% 20% to 30% 30% to 40%

Figure (1.3) Interpretation: 9 respondents save below 10% of salary, 10 respondents save 10% to 20%, 11 respondents save 20% to 30%, No respondents save 30% to 40% of their salary.

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Awareness of life insurance Table (1.4)

Particulars Yes No Respondents 30 0

30 25 20 15 Yes

10
5

No

0
Yes No

Figure (1.4)

Interpretation:
All the respondents are aware of life insurance sector, there is hardly any person who doesnt know about the life insurance.

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Persons having life insurance policy

Table (1.5) Particulars Yes No Respondents 24 6

25 20 15 10 5 Yes No

0
Yes No

Figure (1.5)

Interpretation:Out of 30, 24 respondents have the insurance policy because during my survey I found that now a days insurance is not only taken as a life cover tool but people also take it as an investment and tax saving tool.

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Insurance is the only way to safeguard against the unpredictable risks of the future.
Table (1.6)

Particulars Highly Dis satisfied Dis-satisfied Neutral Satisfied Highly satisfied 0 5 4 11 10

Respondents

12 10 8 6 4 2 0

Figure (1.6)

Interpretation:Out of 30,10 respondents are highly satisfied that insurance is only

safeguard way against the unpredictable risk of future.And 11 are satisfied and 5 are dis satisfied and 4 are netural.

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Insurance is a better tool for investment purpose or for life cover and tax saving

Table (1.7)

Particulars Highly Dis agrred Dis-agreed Neutral Agreed Strongly agreed 0 5 4 10 11

Respondents

Strongly agreed Agreed Neutral Dis-agreed Highly Dis -agrred 0 2 4 6 8 10 12

Figure (1.7)

Interpretation: Out of 30, there are 11 person who are strongly agreed insurance is better tool for investment or for life cover and tax saving.And 10 are agreed.

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Awareness about Bajaj Allianz

Table (1.8) Particulars Yes No Respondents 22 8

Yes No

Figure (1.8)

Interpretation: 22 respondents know about Bajaj Allianz and remaining 8 respondents were unknown about Bajaj Allianz.

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Persons having Bajaj Allianz product Table (1.9)

Particulars Respondents Yes No 14 16

16 15.5

15 14.5
14 13.5 13

Yes

No

Figure (1.9)

Interpretation: Out of 30, 14 respondents have bought the products of Bajaj Allianz, and rest 16 does not have any product of this company. Some of the persons who have not bought its products are unknown about Bajaj Allianz.

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Awareness about unit linked insurance plans.

Table (1.10)

Particulars yes No

Respondents 22 8

25 20

15
10 5 0 yes no

yes

no

Figure (1.10) Interpretation:-There are 22 respondents who know about unit link plans. And 8 are not.

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Customer preference of ULIPs Table (1.11)

Particulars
New unit gain Young care Young care plus New family gain Future secure Century plus Fortune plus Health care

Respondents
1 1 2 2 1 12 2 1

12 10 8 6 4 2 0

Figure (1.11)

Interpretation:-out of 30,12 respondents are having century plus according to them it is

better than other.

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Awareness of traditional plans.

Particulars Yes No

Respondents 23 7

Table (1.12)
25 20 15 10 5 0 yes no

Figure (1.12)

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Customer preference of traditional plans

Table (1.13)

Particulars respondents Invest gain Life time care super saver child gain cash gain 2 3 1 10 6

12 10 8 6 4 2 0 Invest gain Llife time care super saver child gain cash gain

Figure(1.13)

Interpretation: 23 respondents are aware of Traditional Plans and only 7 are not aware of Traditional Plans.Acoording to respondents child gain is better than others.

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Tenure of investment customer prefer

Table (1.14) Particulars 3 years 3 to 5 years More than 5 years Respondents 18 12 00

More than 5 years 3 years

3 to 5 years
3 years 0 5 10 15 20

3 to 5 years
More than 5 years

Figure (1.14)

Interpretation: According to 18 persons, the tenure of investment should be 3 years, 12 says that it should be 3 to 5 years.

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Frequency of payment Table (1.15) Very Bad Yearly Half-yearly Monthly Quarterly 1 1 10 10 Bad 1 5 19 12 Good 7 22 0 1 Very Good 21 2 1 7

YEARLY
very Bad Bad Good very Good

HALF-YEARLY
Very Bad Bad Good Very Good

Table (1.15a)

Table (1.15b)

MONTHLY
Very Bad Bad Very Good

QUARTERLY
Very Bad Bad Good Very Good

Table (1.15c)

Table (1.15d)

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 Interpretation: There are 21 respondents who said yearly payment is very good.

22 respondents said half yearly payment is good Monthly payment is bad most of think that. There are some pepole who favour in quqrterly payment some are not.

Source to know about these plans

Through advertisement Through relatives/friends Table (1.16) Particulars Through advertisement Through relatives/friends Respondents 15 15

16 14 12 10 8 6

4 2 0
Through advertisement Through relatives/friends

Figure (1.16) Interpretation: 15 respondents know about ULIP and Traditional Plans through advertisements and 15 respondents know through relatives/friends.

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ULIPs is better than traditional plans of Bajaj Allianz

Table (1.17)

Particulars Strongly agreed Dis-agreed Neutral Agreed strongly agreed 5 4 13 8 Dis- 0

Respondents

14
12 10 8

6 4
2 0 Strongly Dis-agreed Dis-agreed Neutral Agreed strongly agreed

Figure (1.17) Interpretation: There are 13 respondents who thinks ULIPs better then traditional plans.And 8 are strongly agreed..

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RECOMMENDATIONS

On the basis of the analysis of the data collected from the project the following recommendations are suggested to the company: Good distribution network will be a key to success with the required number of skilled and well-trained agents or the company, should appoint skilled professionals especially MBAs to enhance their workforce. People consider the security of funds more than Brand name and higher returns in an insurance company, so Bajaj Allianz Life Insurance Company should try to lit this psychology of the prospects. The public sector bureaucracies and cumbersome procedure has given an opportunity to private sector to score in the field of customer services, hence the company need to strengthen its customer services. Bajaj Allianz Life Insurance Company should do extensive advertisement i.e. bombardment of advertisement through every media whether electronic, print, or hoarding etc. The company should create awareness about the rules and regulations of IRDA among the public so that they may gain confidence in the private sector companies. Bajaj Allianz Life Insurance Company must associate itself with the organization of events like games, debates, social welfare programs etc. Under social benefits, company should initiate positive phone calls and should provide service suggestions with getting to problems

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CONCLUSION According to my survey, most of the investors prefer ULIP as compared to Traditional Plans because investors want flexibility, higher returns and liquidity that is why ULIP is better than Traditional Plans. It is pertinent to mention that Traditional Plans have comparatively low returns and have less liquidity. ULIP is the insurance cover with investment. Both ULIP and Traditional Plans are under IRDA( Insurance Regulatory And Development Authority).When I conduct the survey, respondents told me that if they go with ULIP, although they should be

more aware of the market but they need not to worry because fund managers manages the money and money can be shifted (switched) to safer funds. Another advantage of ULIPs over Traditional Plans is its flexibility. The difference lies in the flexibility that ULIPs afford the individual. Some insurance companies allow a certain number of 'free' switches. Bajaj Allianz offers three free switches in one policy year. ULIP is more transparent than Traditional Plans. There is no doubt about the returns in ULIP due to proper transparency, but Traditional Plans have no transparency. Customers came to know about their transactions only at the end. ULIP covers insurance with investment. In ULIP, a person on the one hand is investing money in market and on the other hand, he is securing his life. Therefore, ULIP is solving both the problems of investing and insurance. If a person is willing to invest in the market, then ULIP is the best option for him. In Indian market before the era of Traditional Plans and ULIP, three things were very popular FDs, RDs and saving bonds. Now days investors have more choice. At the time of investment investor think about the return, that is why investor prefers both the insurance and good return. In the end we can say that it depends on the appetite of the investor but majority of people want safety, security and higher returns. That is why my report says that ULIP is better otherwise; it is difficult to say which is better.

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