Mutual Funds

Edelweiss Asset Management Limited, a subsidiary of Edelweiss Capital Limited (ECL) is the
asset management company acting as an investment manager to Edelweiss Mutual Fund (EMF).
Edelweiss Capital Limited is one of the leading and fastest growing financial services company
in India. Founded in 1996, Edelweiss Capital including its subsidiaries offers a wide array of
multi-line solutions including Investment Banking, Institutional Equities, Asset Management,
Wealth Management, Private Client Business, Insurance Brokerage, Wholesale Financing and
Treasury Operations.
Edelweiss Asset Management Limited constitutes a team of experienced professionals from the
Financial Services industry. The management team is highly qualified and carries a rich
experience of working in the mutual fund industry and finance related areas.
Edelweiss Asset Management Limited will follow a research based and process oriented
investment approach. Edelweiss Asset Management Limited will observe the highest ethical
standards while deploying investors’ monies and servicing investors and dealing with business
partners.
Vision Statement:
To be an innovative and universally renowned asset manager providing excellent investment

solutions, exemplary services and setting the highest ethical standards.
Mission Statement:
• Providing high quality investment management services to a wide spectrum of investors.

• Assessing investor’s acceptable risk parameters and endeavor to achieve their financial
goals.
• Adhering to a disciplined investment process to steadily grow our investor’s assets.
• Committed to offering exemplary services to our customers and setting the highest
standards of ethics.
We firmly believe that by placing the best interests of our customer first, we will also serve
the best interests of our employees, stakeholders and our community.
Our Principles:
• Thinking and transparent organization

• Fair to our investors, partners and employees
• Ethical in all our actions
• Focus on growth
• Our assets are our stakeholders, reputation and capital
• Creativity and innovation in everything we do
Mutual Funds
The article mentioned below, is for the investors who have not yet started investing in mutual
funds, but willing to explore the opportunity and also for those who want to clear their basics for
what is mutual fund and how best it can serve as an investment tool.
Stocks
Stocks represent shares of ownership in a public company. Examples of public companies

include Reliance, ONGC and Infosys. Stocks are considered to be the most common owned
investment traded on the market.
Bonds
Bonds are basically the money which you lend to the government or a company, and in return
you can receive interest on your invested amount, which is back over predetermined amounts of
time. Bonds are considered to be the most common lending investment traded on the market.
There are many other types of investments other than stocks and bonds (including annuities, real
estate, and precious metals), but the majority of mutual funds invest in stocks and/or bonds.
Working of Mutual Fund
Regulatory Authorities
To protect the interest of the investors, SEBI formulates policies and regulates the mutual funds.
It notified regulations in 1993 (fully revised in 1996) and issues guidelines from time to time.
MF either promoted by public or by private sector entities including one promoted by foreign
entities is governed by these Regulations.
SEBI approved Asset Management Company (AMC) manages the funds by making investments
in various types of securities. Custodian, registered with SEBI, holds the securities of various
schemes of the fund in its custody.
According to SEBI Regulations, two thirds of the directors of Trustee Company or board of
trustees must be independent.
The Association of Mutual Funds in India (AMFI) reassures the investors in units of mutual
funds that the mutual funds function within the strict regulatory framework. Its objective is to
increase public awareness of the mutual fund industry.
AMFI also is engaged in upgrading professional standards and in promoting best industry
practices in diverse areas such as valuation, disclosure, transparency etc.
What is a Mutual Fund?
A mutual fund is just the connecting bridge or a financial intermediary that allows a group of
investors to pool their money together with a predetermined investment objective. The mutual
fund will have a fund manager who is responsible for investing the gathered money into specific
securities (stocks or bonds). When you invest in a mutual fund, you are buying units or portions
of the mutual fund and thus on investing becomes a shareholder or unit holder of the fund.
Mutual funds are considered as one of the best available investments as compare to others they
are very cost efficient and also easy to invest in, thus by pooling money together in a mutual
fund, investors can purchase stocks or bonds with much lower trading costs than if they tried to
do it on their own. But the biggest advantage to mutual funds is diversification, by minimizing
risk & maximizing returns.
Diversification
Diversification is nothing but spreading out your money across available or different types of
investments. By choosing to diversify respective investment holdings reduces risk tremendously
up to certain extent.
The most basic level of diversification is to buy multiple stocks rather than just one stock.
Mutual funds are set up to buy many stocks. Beyond that, you can diversify even more by
purchasing different kinds of stocks, then adding bonds, then international, and so on. It could
take you weeks to buy all these investments, but if you purchased a few mutual funds you could
be done in a few hours because mutual funds automatically diversify in a predetermined category
of investments (i.e. - growth companies, emerging or mid size companies, low-grade corporate
bonds, etc).
Types of Mutual Funds Schemes in India
Wide variety of Mutual Fund Schemes exists to cater to the needs such as financial position, risk
tolerance and return expectations etc. thus mutual funds has Variety of flavors, Being a
collection of many stocks, an investors can go for picking a mutual fund might be easy. There
are over hundreds of mutual funds scheme to choose from. It is easier to think of mutual funds in
categories, mentioned below.
Overview of existing schemes existed in mutual fund category: BY STRUCTURE
1. Open - Ended Schemes:
An open-end fund is one that is available for subscription all through the year. These do not have
a fixed maturity. Investors can conveniently buy and sell units at Net Asset Value ("NAV")
related prices. The key feature of open-end schemes is liquidity.
2. Close - Ended Schemes:
These schemes have a pre-specified maturity period. One can invest directly in the scheme at the
time of the initial issue. Depending on the structure of the scheme there are two exit options
available to an investor after the initial offer period closes. Investors can transact (buy or sell) the
units of the scheme on the stock exchanges where they are listed. The market price at the stock
exchanges could vary from the net asset value (NAV) of the scheme on account of demand and
supply situation, expectations of unitholder and other market factors. Alternatively some close-
ended schemes provide an additional option of selling the units directly to the Mutual Fund
through periodic repurchase at the schemes NAV; however one cannot buy units and can only
sell units during the liquidity window. SEBI Regulations ensure that at least one of the two exit
routes is provided to the investor.
3. Interval Schemes:
Interval Schemes are that scheme, which combines the features of open-ended and close-ended
schemes. The units may be traded on the stock exchange or may be open for sale or redemption
during pre-determined intervals at NAV related prices.
The risk return trade-off indicates that if investor is willing to take higher risk then
correspondingly he can expect higher returns and vise versa if he pertains to lower risk
instruments, which would be satisfied by lower returns. For example, if an investors opt for
bank FD, which provide moderate return with minimal risk. But as he moves ahead to invest in
capital protected funds and the profit-bonds that give out more return which is slightly higher as
compared to the bank deposits but the risk involved also increases in the same proportion.
Thus investors choose mutual funds as their primary means of investing, as Mutual funds
provide professional management, diversification, convenience and liquidity. That doesn’t mean
mutual fund investments risk free. This is because the money that is pooled in are not invested
only in debts funds which are less riskier but are also invested in the stock markets which
involves a higher risk but can expect higher returns. Hedge fund involves a very high risk since it
is mostly traded in the derivatives market which is considered very volatile.
Overview of existing schemes existed in mutual fund category: BY NATURE
1. Equity fund:
These funds invest a maximum part of their corpus into equities holdings. The structure of the
fund may vary different for different schemes and the fund manager’s outlook on different
stocks. The Equity Funds are sub-classified depending upon their investment objective, as
follows:
• Diversified Equity Funds

• Mid-Cap Funds
• Sector Specific Funds
• Tax Savings Funds (ELSS)
Equity investments are meant for a longer time horizon, thus Equity funds rank high on the risk-
return matrix.
2. Debt funds:
The objective of these Funds is to invest in debt papers. Government authorities, private
companies, banks and financial institutions are some of the major issuers of debt papers. By
investing in debt instruments, these funds ensure low risk and provide stable income to the
investors. Debt funds are further classified as:
• Gilt Funds: Invest their corpus in securities issued by Government, popularly known as
Government of India debt papers. These Funds carry zero Default risk but are associated
with Interest Rate risk. These schemes are safer as they invest in papers backed by
Government.
• Income Funds: Invest a major portion into various debt instruments such as bonds,
corporate debentures and Government securities.
• MIPs: Invests maximum of their total corpus in debt instruments while they take
minimum exposure in equities. It gets benefit of both equity and debt market. These
scheme ranks slightly high on the risk-return matrix when compared with other debt
schemes.
• Short Term Plans (STPs): Meant for investment horizon for three to six months. These
funds primarily invest in short term papers like Certificate of Deposits (CDs) and
Commercial Papers (CPs). Some portion of the corpus is also invested in corporate
debentures.
• Liquid Funds: Also known as Money Market Schemes, These funds provides easy
liquidity and preservation of capital. These schemes invest in short-term instruments like
Treasury Bills, inter-bank call money market, CPs and CDs. These funds are meant for
short-term cash management of corporate houses and are meant for an investment
horizon of 1day to 3 months. These schemes rank low on risk-return matrix and are
considered to be the safest amongst all categories of mutual funds.
3. Balanced funds:
As the name suggest they, are a mix of both equity and debt funds. They invest in both equities
and fixed income securities, which are in line with pre-defined investment objective of the
scheme. These schemes aim to provide investors with the best of both the worlds. Equity part
provides growth and the debt part provides stability in returns.
Further the mutual funds can be broadly classified on the basis of investment parameter viz,
Each category of funds is backed by an investment philosophy, which is pre-defined in the
objectives of the fund. The investor can align his own investment needs with the funds objective
and invest accordingly.
By investment objective:
• Growth Schemes: Growth Schemes are also known as equity schemes. The aim of these
schemes is to provide capital appreciation over medium to long term. These schemes
normally invest a major part of their fund in equities and are willing to bear short-term
decline in value for possible future appreciation.
• Income Schemes:Income Schemes are also known as debt schemes. The aim of these
schemes is to provide regular and steady income to investors. These schemes generally
invest in fixed income securities such as bonds and corporate debentures. Capital
appreciation in such schemes may be limited.
• Balanced Schemes: Balanced Schemes aim to provide both growth and income by
periodically distributing a part of the income and capital gains they earn. These schemes
invest in both shares and fixed income securities, in the proportion indicated in their offer
documents (normally 50:50).
• Money Market Schemes: Money Market Schemes aim to provide easy liquidity,
preservation of capital and moderate income. These schemes generally invest in safer,
short-term instruments, such as treasury bills, certificates of deposit, commercial paper
and inter-bank call money.
Other schemes
• Tax Saving Schemes:
Tax-saving schemes offer tax rebates to the investors under tax laws prescribed from time to
time. Under Sec.88 of the Income Tax Act, contributions made to any Equity Linked Savings
Scheme (ELSS) are eligible for rebate.
• Index Schemes:
Index schemes attempt to replicate the performance of a particular index such as the BSE Sensex
or the NSE 50. The portfolio of these schemes will consist of only those stocks that constitute the
index. The percentage of each stock to the total holding will be identical to the stocks index
weightage. And hence, the returns from such schemes would be more or less equivalent to those
of the Index.
• Sector Specific Schemes:
These are the funds/schemes which invest in the securities of only those sectors or industries as
specified in the offer documents. e.g. Pharmaceuticals, Software, Fast Moving Consumer Goods
(FMCG), Petroleum stocks, etc. The returns in these funds are dependent on the performance of
the respective sectors/industries. While these funds may give higher returns, they are more risky
compared to diversified funds. Investors need to keep a watch on the performance of those
sectors/industries and must exit at an appropriate time.
Types of returns
There are three ways, where the total returns provided by mutual funds can be enjoyed by
investors:
• Income is earned from dividends on stocks and interest on bonds. A fund pays out nearly
all income it receives over the year to fund owners in the form of a distribution.
• If the fund sells securities that have increased in price, the fund has a capital gain. Most
funds also pass on these gains to investors in a distribution.
• If fund holdings increase in price but are not sold by the fund manager, the fund's shares
increase in price. You can then sell your mutual fund shares for a profit. Funds will also
usually give you a choice either to receive a check for distributions or to reinvest the
earnings and get more shares.
Pros & cons of investing in mutual funds:
For investments in mutual fund, one must keep in mind about the Pros and cons of investments
in mutual fund.
Advantages of Investing Mutual Funds:
1. Professional Management - The basic advantage of funds is that, they are professional
managed, by well qualified professional. Investors purchase funds because they do not have the
time or the expertise to manage their own portfolio. A mutual fund is considered to be relatively
less expensive way to make and monitor their investments.
2. Diversification - Purchasing units in a mutual fund instead of buying individual stocks or

bonds, the investors risk is spread out and minimized up to certain extent. The idea behind
diversification is to invest in a large number of assets so that a loss in any particular investment
is minimized by gains in others.
3. Economies of Scale - Mutual fund buy and sell large amounts of securities at a time, thus help
to reducing transaction costs, and help to bring down the average cost of the unit for their
investors. 4. Liquidity - Just like an individual stock, mutual fund also allows investors to
liquidate their holdings as and when they want.
5. Simplicity - Investments in mutual fund is considered to be easy, compare to other available

instruments in the market, and the minimum investment is small. Most AMC also have automatic
purchase plans whereby as little as Rs. 2000, where SIP start with just Rs.50 per month basis.
Disadvantages of Investing Mutual Funds:
1. Professional Management- Some funds doesn’t perform in neither the market, as their
management is not dynamic enough to explore the available opportunity in the market, thus
many investors debate over whether or not the so-called professionals are any better than mutual
fund or investor him self, for picking up stocks.
2. Costs – The biggest source of AMC income, is generally from the entry & exit load which
they charge from an investors, at the time of purchase. The mutual fund industries are thus
charging extra cost under layers of jargon.
3. Dilution - Because funds have small holdings across different companies, high returns from a
few investments often don't make much difference on the overall return. Dilution is also the
result of a successful fund getting too big. When money pours into funds that have had strong
success, the manager often has trouble finding a good investment for all the new money.
4. Taxes - when making decisions about your money, fund managers don't consider your
personal tax situation. For example, when a fund manager sells a security, a capital-gain tax is
triggered, which affects how profitable the individual is from the sale. It might have been more
advantageous for the individual to defer the capital gains liability.
AT EDELWEISS
Name: Edelweiss Absolute Return Equity Fund
Scheme Type: An Open Ended Equity Scheme
Investment Objective :
The primary objective of the scheme will be to generate absolute returns with low volatility over
a longer tenure of time. The scheme will invest in arbitrage opportunities, equity derivative
strategies, pure equity investments and the balance in debt and money market instruments. The
Scheme proposes to allocate assets to both equity and debt markets based upon the market view.
However there is no assurance that the investment objective of the scheme will be realized.
Benchmark Index : CRISIL MIP Blended Index
The fund reserves the right to change the benchmark for evaluation of the performance of the
Scheme from time to time, subject to SEBI Regulations and other prevailing guidelines if any.
Fund Manager : Mr. Paul Parampreet
Plans / Options:
The Scheme will have a Single Plan with Dividend and Growth Option. Dividend option shall
have Reinvestment, Payout & Sweep Facility. The AMC reserves the right to introduce further
Plans / Options as and when deemed fit.
Application Amount / No. of Units:
Purchases Additional Purchase Redemption

Minimum of Rs. 5,000/- and in Minimum of Rs. 1,000/- and in Minimum of Rs. 1,000/- and in
multiples of Re. 1/- thereafter. multiples of Re. 1/- thereafter. multiples of Re. 1/- thereafter.
Load Structure :
Entry Load: NIL
Exit Load: Under Normal Circumstances Upto 30 days - 1%
Above 30 days - NIL

Under Expiry Day Trigger Facility Upto 30 days - 0.50%
Above 30 days – NIL
Expenses of the scheme:
As per the SEBI Regulations, the maximum recurring expenses including the investment
management and advisory fee that can be charged to the scheme shall be subject to a percentage
limit of average weekly net assets as given in the table below. Subject to the SEBI Regulations,
expenses over and above the prescribed ceiling will be borne by the AMC.
First Rs.100 Crores Next Rs.300 Crores Next Rs.300 Crores Over Rs.700 Crores
2.50% 2.25% 2.00% 1.75%
Asset Allocation Pattern
Under normal circumstances, the anticipated asset allocation would be:
Indicative
allocation(%
Instruments of total Risk Profile
assets)
Min. Max.
Equity and Equity related Instruments & Derivatives 65% 100% Medium to High
Debt and Money Market Instruments including securitized
0% 35% Low to Medium
debts
Applicable NAV :
(a) Cut off Timing for Subscriptions :
In respect of valid purchase applications accepted at an Investor Service Centers upto 3.00 p.m.
with a local cheque or demand draft payable at par at the place where it is received - closing
NAV of the day of receipt of application;
In respect of valid Purchase applications accepted at an Investor Service Centers after 3.00 p.m.
NAV of the next Business Day ; and
Where the application is received with an outstation cheque or demand draft which is not
payable on par at the place where it is received - closing NAV of day on which the cheque or
demand draft is credited.
(b) Cut off Timing for Redemptions:
In respect of valid applications received upto 3.00 p.m. by the Investor Service Centers - closing
NAV of the day of receipt of application.
In respect of valid applications received after 3.00 p.m. by the Investor Service Centers - closing
NAV of the next Business Day shall be applicable.
The primary objective of the Fund is to generate capital appreciation and income distribution by
investing in a portfolio that endeavors to outperform the S & P CNX Nifty Index.
However, there is no assurance that the investment objective of the scheme will be realized and
the scheme does not assure or guarantee any returns.
"Edelweiss Nifty Enhancer Fund" is only the name of the Fund. The scheme is not an Index
Fund. The equity stocks/ weightages of the equity stocks in the scheme Portfolio may differ vis-
à-vis the underlying stocks of Nifty Index.
Asset Class Allocation (% of Corpus) Risk Profile

Equity & Equity related
65% - 100% Medium to High
instruments
Debt & Money Market
0% - 35% Low to Medium
instruments
Benchmark Index : S& P CNX Nifty
The Fund reserves the right to change the benchmark for evaluation of the performance of the
Fund Manager : Mr. Gaurav Khandelwal
Plans and Options:
The scheme will have three Plans i.e. Plan A, Plan B, Plan C with a common portfolio & each
Plan will have Dividend and Growth Options. Dividend Option shall have Reinvestment, Payout
& Sweep Facility. Each Plan represents interest in the same portfolio of investments and is
identical in all respects to other plans, except for differences relating to annual recurring
expenses, minimum subscription amount to be brought in by the investors applying for the units
in the Scheme.
Default Plan: If the investors fail to mention any Plan - Plan A
Default Option: If the investor does not clearly specify the choice of Option at the time of
investing, it will be deemed that the investor has opted for the Growth Option. In case, if the
investor selects Dividend Option but fails to mention the facility, it will be deemed that the
investor has opted for the dividend reinvestment facility.
The AMC reserves the right to introduce further Plans / Options as and when deemed fit.
Minimum Application amount for each Plan is stated below:
Plan A - Rs. 1,000/- and multiples of Re. 1
Plan B - Rs. 5,000/- and multiples of Re. 1
Plan C - Rs. 10,000/- and multiples of Re 1
Additional Minimum Purchase amount in all Plans is Rs. 1,000 and multiples of Re. 1
Load Structure:
The Load Structure would comprise of an Entry Load and /or an Exit Load / CDSC, as may be
permissible under the Regulations. The load structure is stated as under:
Entry Load: NIL
Above 30 days - NIL
Applicable NAV :
In respect of valid purchase applications accepted at an Investor Service Centers upto 3.00 p.m.
In respect of valid Purchase applications accepted at an Investor Service Centers after 3.00 p.m.
NAV of the next Business Day ; and
payable on par at the place where it is received - closing NAV of day on which the cheque or
In respect of valid applications received upto 3.00 p.m. by the Investor Service Centers - closing
In respect of valid applications received after 3.00 p.m. by the Investor Service Centers - closing
The primary objective of the Fund is to generate long term capital growth from a diversified
portfolio, investing predominantly in equity and equity related securities.
However, there is no assurance that the investment objective of the Scheme will be realized and
the Scheme does not assure or guarantee any returns.
Benchmark Index : S& P CNX Nifty
Who should invest?
Investors with a moderate to high risk profile looking to invest for the medium to long term in
equities as an asset class.
Plans / Options:
The scheme will have three Plans i.e. Plan A, Plan B, Plan C with common portfolio & will have
Dividend and Growth Option. Dividend Option shall have Reinvestment, Payout & Sweep
Facility. Each Plan represents interest in the same portfolio of investments and is identical in all
respects to each other Plan, except for differences relating to annual recurring expenses,
minimum subscription amount to be brought in by the investors applying for the units in the
Scheme.
Default Plan: If the Investor fails to mention any Plan - Plan A.
Default Option: If the investor does not clearly specify the choice of Option at the time of
investing, it will be deemed that the investor has opted for Growth Option. In case, if the investor
selects Dividend Option but fail to mention facility, it will be deemed that the investor has opted
for dividend reinvestment facility.
Minimum Application amount for each Plan is stated below:
Plan A - Rs. 1,000/- and multiples of Re. 1
Plan B - Rs. 5,000/- and multiples of Re. 1
Plan C - Rs. 10,000/- and multiples of Re 1
Additional Minimum Purchase amount in all Plans is Rs. 1,000 and multiples of Re. 1
Load Structure:
Entry Load: NIL
Above 30 days - NIL
Above 30 days – NIL
Cut-off Time and applicable NAV:
(a) Cut off Timing for Subscriptions:
In respect of valid purchase applications accepted at an Investor Service Center upto 3.00 p.m.
In respect of valid Purchase applications accepted at an Investor Service Center after 3.00 p.m.
NAV of the next Business Day ; and Where the application is received with an outstation cheque
or demand draft which is not payable on par at the place where it is received - closing NAV of
day on which the cheque or demand draft is credited.
In respect of valid applications received upto 3 p.m. by the Investor Service Center, the closing
In respect of valid applications received after 3 p.m. by the Investor Service Center, closing
Scheme Type: Open Ended Equity Linked Savings Scheme
Investment Objective
The primary objective of the scheme is to generate long-term capital appreciation with an option
of periodic payouts at the end of lock in periods from a portfolio that invests predominantly in
equity and equity related instruments.
the Scheme does not assure or guarantee any returns.
Benchmark Index : S & P CNX Nifty
Who should invest?
Investors looking for Tax Benefits under Sec. 80C of the Income Tax Act. The fund is suitable
for investors looking at investing in Equity with a three-year horizon.
Indicative Investment Horizon : 3 years
Plans / Options:
Growth Dividend
a. Dividend Reinvestment Facility
b. Dividend Payout Facility*
c. Sweep Facility*
Default Option: Growth Option (between Growth Dividend Option under any Plan)
Default Facility: Dividend Reinvestment (between Reinvestment, Payout Sweep)

Purchases Additional Purchase Redemption*
Minimum of Rs. 500/- per application
Minimum of Rs. 500/- per application Rs.500/-per
& in multiples of Rs. 500/-
& in multiples of Rs. 500/- application
Load Structure:
Entry Load:
The upfront commission on investment made by the investor, if any, shall be paid to the ARN
Holder directly by the investor, based on the investor’s assessment of various factors including
service rendered by the ARN Holder.
Exit Load: Nil
Redemption of Units can be made only after a period of 3 years of lock-in period from the date
of allotment of the Units proposed to be redeemed.
(a) Cut off Timing for Subscriptions
In respect of valid purchase applications accepted at an Investor Service Center after 3.00 p.m.
NAV of the next Business Day ; and Where the application is received with an outstation cheque
or demand draft which is not payable on par at the place where it is received – closing NAV of
day on which the cheque or demand draft is credited.
In respect of valid applications received upto 3.00 p.m. by the Investor Service Center, the
closing NAV of the day of receipt of application.
In respect of valid applications received after 3.00 p.m. by the Investor Service Center, closing
NAV of the next Business Day shall be applicable. Note: Valid applications for 'switch-out' shall
be treated as applications for Redemption and for 'switch-in' shall be treated as applications for
Purchase, and the provisions of the Applicable NAV and cut-off time as mentioned above shall
be applied respectively to the 'switch-in' and 'switch-out' applications.
Asset Allocation Pattern:
Asset Class Allocation (% of corpus) Risk Profile

Equity & Equity related Instruments 80%-100% High
Short Term Debt & Money Market Instruments 0%-20% Low to Medium
Facilities Available:
1. Systematic Investment Plan (SIP)
2. Systematic Withdrawal Plan (SWP)*
3. Systematic Transfer Plan (STP)*
* Available only after a lock-in period of 3 years from the date of allotment of the units
Liquid
Scheme Type: Open Ended Liquid Scheme
The objective of the Scheme is to provide optimal returns, commensurate with low risk and high
degree of liquidity, through a portfolio constituted of money market & short term debt
instruments. However, there is no assurance that the investment objective of the Scheme will be
realized and the Scheme does not assure or guarantee any returns.
Benchmark Index:
CRISIL Liquid Fund Index.
Fund Manager: Mr. Kapil Punjabi
Who should invest?
Liquid funds are ideal for Investors, who want to deploy funds for short period, require high
liquidity and have a lower risk appetite.
Indicative Investment Horizon : 1 week to 3 months
Plans / Options:
Plans Options Sub-options Frequency

Retail Plan Growth / Dividend Dividend Reinvestment / Reinvestment: Daily /
Dividend Payout / Weekly / Fortnightly /
Dividend Sweep Monthly
Payout: Monthly *
Sweep: Monthly
Institutional Plan Growth / Dividend Dividend Reinvestment / Reinvestment: Daily /
Payout: Monthly
Sweep: Monthly
Super Institutional Plan Growth / Dividend Dividend Reinvestment / Reinvestment: Daily /
Payout: Monthly
Sweep: Monthly
Default Option: Retail Plan, Dividend Option, Daily Dividend Reinvestment Option
Minimum Application Amount / No. of Units:
Minimum Additional
Plan Minimum Investments Redemption
Amount
Retail Plan Rs.10,000 & in multiples of Rs. 1,000 & in multiples Rs.5,000/- & in
Re. 1 thereafter of Re. 1 thereafter multiples of
Rs. 1/- thereafter.
Institutional Plan Rs. 1 Crore & in multiples Rs. 1 lac & in multiples of Rs.5,000/- & in
of Re. 1 thereafter Re. 1 thereafter multiples of
Rs. 1/- thereafter.
Super Rs. 10 Crore & in multiples Rs. 10 lac & in multiples Rs.5,000/- & in
Institutional Plan of Re. 1 thereafter of Re. 1 thereafter multiples of
Rs. 1/- thereafter.
Load Structure:
Entry Load: Nil
Exit Load: Nil
Indicative allocation (% of
Instruments total assets) Risk Profile
Min. Max.
Money Market 0% 100% Low
Instruments
Debt instruments 0% 50% Low to Medium
including securitized debts
Operation Cut off time Applicable ANV

In respect of valid applications Upto 12.00 noon The closing NAV of the day
received & funds are available for immediately preceding the day of
utilization on the same day receipt of application
After 12.00 noon The closing NAV of the day
immediately preceding the next
Business Day
In respect of valid Purchase
The closing NAV of the day
Irrespective of applications accepted Irrespective of the
immediately preceding the day on
on a time of acceptance funds are not time of accept of
which the funds are available for
available for utilization by the application
utilization by the Scheme.
Scheme.
Upto 3.00 PM The closing NAV of the day
immediately proceeding the next
In respect of valid redemption request business day.
received
After 3.00 PM Closing NAV of the next business
day shall be applicable.
2. Systematic Withdrawal Plan (SWP)
3. Systematic Transfer Plan (STP)

DEBT
Edelweiss Short Term Bond Fund (formerly Edelweiss Liquid Plus Fund)
Scheme Type: Open Ended Debt Scheme
The objective of the Scheme is to provide reasonable returns, commensurate with moderate level
of risk and high degree of liquidity, through a portfolio constituted of money market and debt
instruments.
Benchmark Index:
CRISIL Liquid Fund Index
Who should invest?
Short Term Bond Funds are suitable for Investors, who want to deploy funds for short period,
require high liquidity and have a lower risk appetite.
Indicative Investment Horizon : 1 week to 6 months
Plans / Options:
Plans Options Sub-options Frequency

Retail Plan Growth / Dividend Dividend Reinvestment / Reinvestment: Daily /
Payout: Monthly
Sweep: Monthly
Institutional Plan Growth / Dividend Dividend Reinvestment / Reinvestment: Daily /
Payout: Monthly
Sweep: Monthly
Minimum Application Amount / No. of Units:
Plan Purchase Additional Purchase Redemption

Retail Plan Rs.5,000/- and in Minimum of Rs.1,000/- and in
multiples of Re. multiples of Re. 1/-thereafter Rs.5,000/- & in multiples
1/- of
thereafter. Re. 1/- thereafter.
Institutional Rs. 1 Crore - and Minimum of Rs.1,00,000/- and

Plan in in Rs.5,000/- & in multiples
multiples of Re. multiples of Re. 1/- thereafter of
1/- Re. 1/- thereafter.
thereafter.
Load Structure:
Entry Load: Nil
Exit Load: 0.10% if redeemed before 8th day of the allotment.
Min. Max.
Money Market 0% 100% Low
Instruments
Debt instruments 0% 100% Low to Medium
including securitized debts
Operation Cut off time Applicable ANV

Upto 3.00 PM The closing NAV of the day of
Valid Purchase / Redemption receipt of application
applications received on a Business
After 3.00 PM The closing NAV of the next business
Day
day.
Irrespective of the time of receipt of application, in respect of all valid purchase applications with
an amount equal to or more than Rs. 1 crore, NAV applicable will be the closing NAV of the day
on which the funds are available for utilization.
Note: Valid applications for 'switch-out' shall be treated as applications for Redemption and for
'switch-in' shall be treated as applications for Purchase, and the provisions of the Applicable
NAV and cut-off time as mentioned above shall be applied respectively to the 'switch-in' and
'switch-out' applications.
2. Systematic Withdrawal Plan (SWP)

EDELWEISS INTERVAL FUND
(An Interval Income Scheme)
Offer of Units at Rs. 10/- each (subject to applicable load, if any) during the NFO Period & at
NAV based prices during the Specified Transaction Period(s).
Fund Name of Series
Monthly Interval Fund (30 days) Edelweiss Monthly Interval Fund – Series 1
Quarterly Interval Fund (90 days) Edelweiss Quarterly Interval Fund – Series 1
Scheme Type: An Interval Income Scheme
Who should invest?
Suitable for investors seeking to obtain return from Debt/Money Market instruments
commensurate with the investment horizons and low to medium risk profile of underlying
portfolio.
Investment Objective:
The objective of the Scheme is to generate regular income through investments in Debt &
Money Market Instruments. However, there is no assurance that the investment objective of the
Scheme will be realized and the Scheme does not assure or guarantee any returns.
Scheme Features:
Plans Options Sub-options

Retail Plan Growth / Dividend Dividend Reinvestment / Dividend Payout
Institutional Plan Growth / Dividend Dividend Reinvestment / Dividend Payout
Plan Purchase Redemption

Retail Plan Rs.10,000/- & in multiples of Re. 1/- Rs.5,000/- & in multiples of Rs. 1/-
thereafter thereafter.
Institutional Rs. 10 Lac & in multiples of Re. 1/- Rs. 5,000/- & in multiples of Rs. 1/-
Plan thereafter. thereafter.
Min. Max.
Debt & Money Market Instrument 0%100% Low to
(Including Securitised Debts upto 50% of net Medium
assets of the Scheme)
Benchmark Index: CRISIL Liquid Fund Index
* For Subscription including Switch-in
An Investor may submit Subscription/Switch-in request only during the "Specified

Transaction Period", as specified in SID. The units will be issued in respect of all valid
applications received on the "Specified Transaction Period" upto the cut off time along with a
local cheque or a demand draft payable at par at the place where the application is received.
* For Redemption including Switch-out
Unit holder may submit Redemption or Switch-out request at any Business Day subject to the
applicable load, if any. However no load will be charged for request received during "Specified
Transaction Period" upto the cut off timings.
Load Structure:
Entry Load:- NIL
The upfront commission on investment made by the investor, if any, shall be paid to the ARN
Holder directly by the investor, based on the investor’s assessment of various factors including
service rendered by the ARN Holder.
*Exit Load :- NIL If redeemed during the "Specified Transaction Period"

5% if redeemed during Interval Period
2. Trigger
Scheme Type: An Open Ended Gilt Scheme
The investment objective of the scheme is to generate income and capital appreciation by
investing predominantly in securities issued by the Government of India or State Governments.
the scheme does not assure or guarantee any returns.
Indicative allocation(% of total

Instruments assets) Risk Profile
Min. Max.
Government Securities 65% 100% Sovereign
Debt and Money Market Instruments 0% 35% Low
Benchmark Index : I-Sec Composite Gilt Index
scheme from time to time, subject to SEBI Regulations and other prevailing guidelines, if any.
Fund Manager : Mr. Kapil Punjabi
Plans / Options:
The scheme will have a Single Plan with Dividend and Growth Option. Dividend Option shall
have Reinvestment, Payout & Sweep Facility.
Default Option/Facility:
In case, if the investor does not clearly specify the choice of Option at the time of investing, it
will be deemed that the investor has opted for Growth Option. In case, if the investor selects
Dividend Option but fails to mention facility, it will be deemed that the investor has opted for
Dividend Reinvestment Facility.
If dividend is less than Rs. 100 then no payout facility would be available & the dividend will be
compulsorily reinvested.
Purchases Additional Purchase Redemption

Minimum of Rs. 5,000/- and in Minimum of Rs. 1,000/- and in Minimum of Rs. 1,000/- and in
multiples of Re. 1/- thereafter. multiples of Re. 1/- thereafter. multiples of Re. 1/- thereafter.
Load Structure :
Entry Load:
NIL
Exit Load:
Upto 7 days - 0.10%
Above 7 days – Nil
Recurring expenses:
As per the SEBI Regulations, the maximum recurring expenses including the investment
management and advisory fee that can be charged to the scheme shall be subject to a percentage
limit of average weekly net assets as given in the table below. Subject to the SEBI Regulations,
expenses over and above the prescribed ceiling will be borne by AMC.
First Rs.100 Crores Next Rs.300 Crores Next Rs.300 Crores Over Rs.700 Crores
2.25% 2.00% 1.75% 1.50%
Applicable NAV :

In respect of valid Purchase applications accepted at an Investor Service Center after 3.00 p.m.
NAV of the next Business Day ;and
payable on par at the place where it is received closing NAV of day on which the cheque or
In respect of valid applications received upto 3.00 p.m. by the Investor Service Center - closing
In respect of valid applications received after 3.00 p.m. by the Investor Service Center - closing
Unit Linked Insurance Plan (ULIP) provides for life insurance where the policy value at any time
varies according to the value of the underlying assets at the time. ULIP is life insurance solution
that provides for the benefits of protection and flexibility in investment. The investment is
denoted as units and is represented by the value that it has attained called as Net Asset Value
(NAV).
ULIP came into play in the 1960s and is popular in many countries in the world.
As times progressed the plans were also successfully mapped along with life insurance need to
retirement planning. In today's times, ULIP provides solutions for insurance planning, financial
needs, and many types of financial planning including children’s marriage planning.
Unit Linked Insurance Plan - is a financial product that offers you life insurance as well as an
investment like a mutual fund. Part of the premium you pay goes towards the sum assured
(amount you get in a life insurance policy) and the balance will be invested in whichever
investments you desire - equity, fixed-return or a mixture of both.
In India investments in ULIP are covered under Section 80C of IT Act. However, the concept of
having an investment and insurance by the same instrument was challenged by the market
regulator SEBI which took up the matter to the Supreme Court of India .The Indian government
brought down curtains on the two-month long tussle between the regulators by ruling that Unit-
linked Insurance Products (Ulips) will be governed by the Insurance Regulatory and
Development Authority
ULIPs- Systematic Insurance cum Investment Plan
Any individual who has purchased a life insurance policy in the last year or so surely would have
a Unit Linked Insurance Plan (ULIP). ULIPs have been selling like Wonder Products in the
recent past and they are likely to continue to outsell their plain vanilla counterparts going ahead.
A ULIP is a market-linked insurance plan. The difference between a ULIP and other insurance
plans is the way in which the premium money is invested. Premium from, say, an endowment
plan, is invested primarily in risk-free instruments like government securities (gsecs) and AAA
rated corporate paper, while ULIP premiums can be invested in stock markets in addition to
corporate bonds and gsecs. Here are some reasons, which have made ULIPs so irresistible.
Transparency
However, ULIPs offer a transparent option for customers to plan their various life stage needs
through market-led investments as compared to traditional investment plans.
Insurance cover plus savings
ULIPs serve the purpose of providing life insurance combined with savings at market-linked
returns. To that extent, ULIPs can be termed as a two-in-one plan in terms of giving an individual
the twin benefits of life insurance plus savings. This is unlike comparable instruments like a
mutual fund for instance, which does not offer a life cover.
Multiple investment options
ULIPs offer variety than traditional life insurance plans. So there are multiple options at the
individual's disposal. ULIPs generally come in three broad variants:
• Aggressive ULIPs (which invest 80%-100% in equities, balance in debt)
• Balanced ULIPs (invest around 40%-60% in equities)
• Conservative ULIPs (invest upto 20% in equities)
Although this is how the ULIP options are generally designed, the exact debt/equity allocations
may vary across insurance companies. A ULIP policyholder has the option to invest in a variety
of funds, depending on his risk profile. If one does not have the appetite to invest in equity, they
can choose a debt or balanced fund.
Flexibility
Individuals can switch between the ULIP variants outlined above to capitalise on investment
opportunities across the equity and debt markets. Some insurance companies allow a certain
number of free' switches. This is an important feature that allows the informed
individual/investor to benefit from the vagaries of stock/debt markets. For instance, when stock
markets were on the brink of 7,000 points (Sensex), the informed investor could have shifted his
assets from an Aggressive ULIP to a low-risk Conservative ULIP.
Switching also helps individuals on another front. They can shift from an Aggressive to a
Balanced or a Conservative ULIP as they approach retirement. This is a reflection of the change
in their risk appetite, as they grow older.
Works like a SIP
Rupee cost-averaging is another important benefit associated with ULIPs. Individuals have
probably already heard of the Systematic Investment Plan (SIP), which is increasingly being
advocated by the mutual fund industry. With a SIP, individuals invest their monies regularly over
time intervals of a month/quarter and don't have to worry about `timing' the stock markets. These
are not benefits peculiar to mutual funds. Not many realise that ULIPs also tend to do the same,
albeit on a quarterly/half-yearly basis. As a matter of fact, even the annual premium in a ULIP
works on the rupee cost-averaging principle. An added benefit with ULIPs is that individuals can
also invest a one-time amount in the ULIP either to benefit from opportunities in the stock
markets or if they have an investible surplus in a particular year that they wish to put aside for
the future. When you're buying a ULIP, make sure you select one that works well for you. The
important thing is to look for and understand the nuances, which can considerably alter the way
the product works for you. Take the following into consideration:
Charges : Understand all the charges levied on the product over its tenure, not just the initial
charges. A complete charge structure would include the initial charges, the fixed administrative
charges, the fund management charges, mortality charges and spreads, and that too, not only in
the first year but also through the term of the policy.
Fund Options and Management : Understand the various fund options available to you and the
fund management philosophy and objectives of each of them. Examine the track record of the
funds and how they are performing in comparison to benchmarks. Who manages the funds and
what experience do they have? Are there adequate controls? Importantly, look at how easily you
can access information about your fund's performance when you need it -- what are their daily
NAVs? Is the portfolio disclosed regularly?
Features : Most ULIPs are rich in features such as allowing one to top-up or switch between
funds, increase or decrease the protection level, or premium holidays. For instance, is there a
minimum amount that must be switched? Is there a charge on the same? Must you go through
medical underwriting if you want to increase the sum assured?
Company : Last but not least, insure with a brand you can trust to honour its commitment and
service you according to your requirements.
First and foremost, investors need to understand that a ULIP is a bundled product of their
investments and their insurance proceeds. Since privatization in 2000 and the introduction of
ULIPs as a life insurance product category, the overall insurance penetration in the country has
grown from around 2% to 4%. Today, more than 70 per cent of the new business premium for
life insurers comes from Ulips.
AT LIC
Market Plus I
“IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS BORNE

BY THE POLICYHOLDER”
This is a unit linked deferred pension plan. You can take the plan with or without life cover.
You can also choose the level of cover within the limits, which will depend on whether the
policy is a Single premium or Regular premium contract and on the level of premium you agree
to pay.
Four types of investment Funds are offered. Premiums paid after allocation charge will purchase
units of the Fund type chosen. The Unit Fund is subject to various charges and value of units
may increase or decrease, depending on the Net Asset Value (NAV).
Other Features:
i) Top-up (Additional Premium) : You can pay additional premium in multiples of Rs.1,000
without any limit at anytime during the term of policy. In case of yearly, half-yearly, quarterly or
monthly (ECS) mode of premium payment such Top-up can be paid only if all premiums have
been paid under the policy.
ii) Switching: You can switch between any fund types during the policy term subject to
switching charges, if any.
iii) Increase / Decrease of risk covers: No increase of covers will be allowed under the plan.
You can, however, decrease any or all of the risk covers within the specified limit once in a year
during the Policy term, provided all due premiums under the Policy have been paid. The reduced
levels of cover will be available within the limits specified in para 4 above. Further, once
reduction in risk cover is allowed, the same cannot be subsequently increased/ restored.
iv) Partial Withdrawal: No partial withdrawal of units will be allowed under this plan.
v) Discontinuance of premiums and revival: If premiums are payable either yearly, half-
yearly, quarterly or monthly (through ECS) and the same have not been paid within the days of
grace, the Policy will lapse. A lapsed policy can be revived during the period of two years from
the due date of first unpaid premium.
I. Where atleast 3 years’ premiums have been paid, the Life cover, Accident Benefit and Critical
Illness Benefit riders, if any, shall continue during the revival period.
During this period, the charges for Mortality, Accident Benefit and / or Critical Illness Benefit
riders, if any, shall be taken, in addition to other charges, by cancelling an appropriate number of
units out of the Policyholder’s Fund Value every month. This will continue to provide relevant
risk covers:
1. for two years from the due date of first unpaid premium, or
2. till the date of vesting, or
3. till such period that the Policyholder’s Fund Value reduces to one annualized premium,
whichever is earlier.
The benefits payable under the policy in different contingencies during this period shall be as
under:
A. In case of Death: Life cover Sum Assured plus the Policyholder’s Fund Value, if life
cover is opted for. If life cover is not opted for, then only the Policyholder’s Fund Value is
payable.
B. In case of Death due to accident: Accident Benefit Sum Assured in addition to the
amount under A above, if Accident Benefit is opted for.
C. In case of Critical Illness claim: Critical Illness Rider Sum Assured, if opted for.
D. On vesting: The Policyholder’s Fund Value.
E. In case of Surrender (including Compulsory Surrender): The Policyholder’s Fund

Value. The Surrender value, however, shall be paid only after the completion of 3 policy
years.
II. Where the policy lapses without payment of at least 3 years’ premiums, the Life Cover,
Accident Benefit and Critical Illness Benefit rider covers, if any, shall cease and no charges for
these benefits shall be deducted. However deduction of all the other charges shall continue. The
benefits under such a lapsed policy shall be payable as under:
A. In case of Death: The Policyholder’s Fund Value.
B. In case of death due to accident: Only, the amount as under F above.
C. In case of Critical Illness claim: Nil
D. In case of Surrender (including Compulsory Surrender): Policyholder’s Fund Value /

monetary value as the case may be, shall be payable after the completion of the third
policy anniversary. No amount shall be payable within 3 years from the date of
commencement of policy.
vi) Revival: If due premium is not paid within the days of grace, the policy lapses. A lapsed
policy can be revived during the period of two years from the due date of first unpaid premium
or before vesting, whichever is earlier. The period during which the policy can be revived will be
called “Period of revival” or “revival period”.
If premiums have not been paid for at least 3 years, the policy may be revived within two years
from the due date of first unpaid premium. If the life cover is opted for, the revival shall be made
on submission of proof of continued insurability to the satisfaction of the Corporation and the
payment of all the arrears of premium without interest.
If life cover is not opted for, the revival shall be made on the payment of all the arrears of
premium without interest.
If at least 3 years’ premiums have been paid and subsequent premiums are not duly paid, the
policy may be revived within two years from the due date of first unpaid premium but before the
date of vesting, if earlier. No proof of continued insurability is required and all arrears of
premium without interest shall be required to be paid, irrespective of whether life cover is opted
for or not.
The Corporation reserves the right to accept the revival at its own terms or decline the revival of
a lapsed policy. The revival of a lapsed policy shall take effect only after the same is approved
by the Corporation and is specifically communicated in writing to the Policyholder.
Irrespective of what is stated above, if less than 3 years’ premiums have been paid and the
Policyholder’s Fund Value is not sufficient to recover the charges, the policy shall terminate and
thereafter revival will not be entertained. If 3 years or more than 3 years premiums have been
paid and the Policyholder’s Fund Value reduces to one annualized premium, the policy shall
terminate and Policyholder’s Fund Value as on such date shall be refunded to the Life Assured
and thereafter revival will not be allowed.
vii) Conversion to annuity at Vesting date: On surviving to the date of vesting, the
Policyholder’s Fund Value will compulsorily be utilised to provide an annuity based on the then
prevailing immediate annuity rates under the relevant annuity option. An option will also be
there to commute up to one-third of the Policyholder’s Fund Value at the time of vesting of the
annuity, which shall be paid as a lump sum. In case commutation is opted for, the amount of
annuity/pension available will be reduced proportionately. There will also be an option to
purchase pension from any other life insurance company registered with IRDA subject to
Regulatory provisions. If you opt to purchase pension from any other life insurance Company,
you will have to inform it to the Corporation six months prior to the vesting date. In such case,
LIC will transfer the Policyholder’s Fund Value directly to the chosen Company.
Notwithstanding the above mentioned, in case the amount at the vesting date is insufficient to
purchase the minimum amount of annuity allowed by LIC, then the balance in the Policyholder’s
Fund Value at the vesting date shall be refunded to the Policyholder.
4. Reinstatement:
A policy once surrendered cannot be reinstated.
5. Risks borne by the Policyholder:
1. LIC’s Market Plus – I is a Unit Linked Life Insurance product which is different from the
traditional insurance products and is subject to the risk factors.
2. The premium paid in Unit Linked Life Insurance policies are subject to investment risks
associated with capital markets and the NAVs of the units may go up or down based on
the performance of fund and factors influencing the capital market and the insured is
responsible for his/her decisions.
3. Life Insurance Corporation of India is only the name of the Insurance Company and
LIC’s Market Plus - I is only the name of the unit linked life insurance contract and does
not in any way indicate the quality of the contract, its future prospects or returns.
4. Please know the associated risks and the applicable charges, from your Insurance agent or
the Intermediary or policy document of the insurer.
5. The various funds offered under this contract are the names of the funds and do not in
any way indicate the quality of these plans, their future prospects and returns.
6. All benefits under the policy are also subject to the Tax Laws and other financial
enactments as they exist from time to time.
6. Cooling off period:
If you are not satisfied with the “Terms and Conditions” of the policy, you may return the policy
to us within 15 days. The amount to be refunded in case the policy is returned within the cooling-
off period shall be determined as under:
Value of units in the Policyholder’s Fund
Plus unallocated premium.
Plus PolicyAdministration charge deducted
Less charges @ Rs.0.20per thousand Life Cover Sum Assured if life cover is opted for or @
Rs. 0.20per thousand of Total Premiums payable during entire term of policy, if life cover is not
opted for.
Less Actual cost of medical examination and special reports, if any.
7. Loan:
No loan will be available under this plan.
8. Assignment:
Assignment is allowed under this plan during the deferment period.
9. Exclusions:
In case the Life Assured commits suicide at any time within one year, the Corporation will not
entertain any claim by virtue of the policy except to the extent of the Fund Value of the units
held in the Policyholder’s Unit Account on death.
Profit Plus
“IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS

BORNE BY THE POLICYHOLDER”
It is a unit linked Endowment plan where the premium payment term (PPT) is limited to single
lump sum, or uniformly over 3, 4 or 5 years. You can choose the level of cover within the limits,
which will depend on whether the policy is a Single premium or Limited premium contract, term
chosen and on the level of premium you agree to pay.
Other Features:
i) Partial Withdrawals: Youmay encash the units partially after the third policy anniversary
subject to the following:
1. In case of minors, partial withdrawals shall be allowed from the policy anniversary
coinciding with or next following the date on which the life assured attains majority (i.e.
on or after 18th birthday).
2. Partial withdrawals may be in the form of fixed amount or in the form of fixed number of
units.
3. For 2 years’ period from the date of withdrawal, the Sum Assured under the Basic plan
shall be reduced to the extent of the amount of partial withdrawals made.
4. Under Limited Premium Paying Term policies where less than 3 years’ premiums have
been paid and further premiums are not paid, the partial withdrawals shall not be allowed.
5. Under Limited Premium Paying Term policies where atleast 3 years’ premiums have
been paid, partial withdrawal will be allowed subject to Policyholder’s Fund Value being
at least Rs. 10000/-.
6. Under Single Premium policies, the partial withdrawal will be allowed subject to a
minimum balance of Rs. 5000/- in the Policyholder’s Fund Value.
ii) Switching: You can switch between any fund types for the entire Fund Value during the
policy term subject to switching charges, if any.
iii) Discontinuance of premiums: If premiums are payable either yearly, half-yearly, quarterly
or monthly (ECS) and the same have not been duly paid within the days of grace under the
Policy, the Policy will lapse. A lapsed policy can be revived during the period of two years from
the due date of first unpaid premium.
I) Where atleast 3 years’ premiums have been paid, the Life Cover, Accident Benefit and Critical
Illness Benefit riders, if any, shall continue during the revival period.
cover, if any, shall be taken, in addition to other charges, by cancelling an appropriate number of
risk covers for:
1. two years from the due date of first unpaid premium, or

2. till the date of maturity, or
3. till such period that the Policyholder’s Fund Value reduces to Rs. 5,000/-,
under:
A. In case of Death: Higher of Sum Assured under the Basic Plan or the Policyholder’s
Fund Value. The Sum Assured shall be subject to provisions of Partial Withdrawals made, if any.
D. On maturity: The Policyholder’s Fund Value.
E. In case of Surrender (including Compulsory Surrender): The Policyholder’s Fund
Value. The Surrender value, however, shall be paid only after the completion of 3 policy years.
F. In case of Partial Withdrawals: For 2 years period from the date of withdrawal, the sum
assured under the basic plan shall be reduced to the extent of the amount of partial withdrawals
made.
II) Where the policy lapses without payment of at least 3 years’ premiums, the Life Cover,
Accident Benefit and/or Critical Illness Benefit rider covers, if any, shall cease and no charges
for these benefits shall be deducted. However, deduction of all the other charges shall continue.
The benefits under such a lapsed policy shall be payable as under:
G. In case of Death: The Policyholder’s Fund Value.
H. In case of death due to accident: Only, the amount as under G above.

I. In case of Critical Illness claim: Nil
J. In case of Surrender (including Compulsory Surrender): Policyholder’s Fund Value /
monetary value as the case may be, shall be payable after the completion of the third policy
anniversary. No amount shall be payable within 3 years from the date of commencement of
policy.
K. In case of Partial withdrawal: Partial Withdrawals shall not be allowed under such a
policy even after completion of 3 years period.
iv) Revival: If due premium is not paid within the days of grace, the policy lapses. A lapsed
policy can be revived during the period of two years from the due date of first unpaid premium
or before maturity, whichever is earlier. The period during which the policy can be revived will
be called “Period of revival” or “revival period”.
If premiums have not been paid for at least 3 full years, the policy may be revived within two
years from the due date of first unpaid premium. The revival shall be made on submission of
proof of continued insurability to the satisfaction of the Corporation and the payment of all the
arrears of premium without interest.
If atleast 3 full years’ premiums have been paid and subsequent premiums are not paid, the
date of maturity. No proof of continued insurability shall be required but all arrears of premium
without interest shall be required to be paid.
by the Corporation and is specifically communicated in writing to the Proposer / Life Assured.
Policyholder’s Fund Value is not sufficient to recover the charges, the policy shall be terminated
and thereafter revival will not be entertained. If 3 years’ or more than 3 years’ premiums have
been paid and the Policyholder’s Fund Value reduces to Rs. 5000/-, the policy shall terminate
and Policyholder’s Fund Value as on such date shall be refunded to the Life Assured and
thereafter revival will not be allowed.
v) Settlement Option: When the policy comes for maturity, you may exercise “Settlement
Option” and may receive the policy money in instalments spread over a period of not more than
five years from the date of maturity. There shall not be any life cover during this period. The
value of installment payable on the date specified shall be subject to investment risk i.e. the NAV
may go up or down depending upon the performance of the fund.
Reinstatement:
Risks borne by the Policyholder:
1. LIC’s Profit Plus is a Unit Linked Life Insurance products which is different from the
traditional insurance products and are subject to the risk factors.
the performance of fund and factors influencing the capital market and the insured is
LIC’s Profit Plus is only the name of the unit linked life insurance contract and does not
in any way indicate the quality of the contract, its future prospects or returns.
Cooling off period:

to us within 15 days.
Loan:
Assignment:
Assignment will be allowed under this plan.
Exclusions:
entertain any claim by virtue of the policy except to the extent of the Fund Value of the units
held in the Policyholder’s Fund Value on death.
Money Plus-I
"IN THIS POLICY, THE INVESTMENT RISK IN INVESTMENT PORTFOLIO IS

BORNE BY THE POLICYHOLDER"
This is a unit linked Endowment plan with regular premium paying term which offers investment
cum insurance during the term of the policy. You can choose the level of cover within the limits,
which will depend on the level of premium you agree to pay.
1.Payment of Premiums: You may pay premiums regularly at yearly, half-yearly, quarterly or
monthly (through ECS mode only) intervals over the term of the policy.
2. Eligibility Conditions And Other Restrictions:

(a) Minimum Age at entry - 0 (age last birthday)
(b) Maximum Age at entry - 65 years (age nearer birthday)
(c) Minimum Maturity Age - 18 years (completed)
(d) Maximum Maturity Age - 75 years (age nearer birthday)
(e) Policy Term - 10, 15 to 30 years
(f) Minimum Premium - Regular premium (other than monthly (ECS) mode):
Rs. [5,000] p.a. for policy term 20 to 30 years
Rs. [15,000] p.a. for policy term 10 years
Regular premium (for monthly (ECS) mode):

Rs. [1,000] p.m. for policy term 15 to 30 years
Rs. [1,500] p.m. for policy term 10 years
(g) Sum Assured under the Basic Plan -

Minimum Sum Assured : 5 times the annualized premium
Maximum Sum Assured :
30 times of the annualized premium if age at entry is upto 45 years
20 times of the annualized premium if age at entry is 46 to 60 years
10 times of the annualized premium if age at entry is 61 years and above
Where the minimum Sum Assured is not in the multiples of Rs. 5,000, it will be rounded off to
the next multiple of Rs. 5,000. Annualized Premiums shall be payable in multiple of Rs. 1,000
for other than ECS monthly. For monthly (ECS), the premium shall in multiples of Rs. 250/-.
Commencement of risk in case of minor: Risk will commence either after 2 years from the
date of commencement of policy or from the policy anniversary coinciding with or immediately
following the completion of 7 years of age, whichever is later in case the age at entry of the life
assured is less than or equal to 10 years. Where the age at entry is more than 10 years but less
than 12 years, the risk shall commence from the policy anniversary coinciding with or next
following 12th birthday of the Life Assured. In case of minors aged 12 years or more risk will
commence immediately.
3. Other Features:
• Partial Withdrawals: Youmay encash the units partially after the third policy
anniversary subject to the following:
i. In case of minors, partial withdrawals shall be allowed from the policy anniversary
coinciding with or next following the date on which the life assured attains majority (i.e. on or
after 18th birthday).
ii. Partial withdrawals may be in the form of fixed amount or in the form of fixed number of
units.
iii. For 2 years’ period from the date of withdrawal, the Sum Assured under the Basic plan
shall be reduced to the extent of the amount of partial withdrawals made.
iv. Under Regular Premium policies where less than 3 years’ premiums have been paid and
further premiums are not paid, the partial withdrawals shall not be allowed.
v. Under Regular Premium policies where atleast 3 years’ premiums have been paid, partial
withdrawal will be allowed subject to a minimum balance of two annualized premiums in the
Policyholder’s Fund Value.
• Switching: You can switch between any fund types for the entire Fund Value during the policy
term subject to switching charges, if any.
• Increase / Decrease of risk covers: No increase of covers will be allowed under the
plan. You can, however, decrease any or all of the risk covers within the specified limit
once in a year during the Policy term, provided all due premiums under the Policy have
been paid. The reduced levels of cover will be available within the limits specified in para
4 above. Further, once reduction in risk cover is allowed, the same cannot be
subsequently increased/ restored.
• Option to continue the cover after the revival period: If atleast three years’
premiums have been paid under the policy, the policyholder may opt for continuation of
cover even beyond the revival period without reviving the policy and paying any further
premiums. This option shall be required to be exercised atleast one month before the
completion of the revival period. If this option is availed, the cover under the policy shall
continue by deduction of relevant charges out of policy fund. This option shall continue
till the Policyholder’s Fund Value reaches one annualized premium. No further premiums
shall be allowed to be paid after the revival period is over.
• Discontinuance of premiums: If premiums are payable either yearly, half-yearly,

quarterly or monthly (ECS) and the same have not been duly paid within the days of
grace under the Policy, the Policy will lapse. A lapsed policy can be revived during the
period of two years from the due date of first unpaid premium.
I) Where atleast 3 years’ premiums have been paid, the Life Cover, Accident Benefit and
Critical Illness Benefit riders, if any, shall continue during the revival period.
cover, if any, shall be taken, in addition to other charges, by cancelling an appropriate number of
risk covers for :

3. till such period that the Policyholder’s Fund Value reduces to one
annualized premium,
Further, the policyholder may opt for continuation of cover even beyond the revival period
without reviving the policy and paying any further premiums. This option shall be required to be
exercised atleast one month before the completion of the revival period. If this option is availed,
the cover under the policy shall continue by deduction of relevant charges out of policy fund.
This option shall continue till the Policyholder’s Fund Value reaches one annualized premium.
No further premiums shall be allowed to be paid after the revival period is over.
under:
A. In case of Death: Higher of Sum Assured under the Basic Plan or the Policyholder’s
Fund Value. The Sum Assured shall be subject to provisions of Partial Withdrawals made, if any.
D. On maturity: The Policyholder’s Fund Value.
E. In case of Surrender (including Compulsory surrender): The Policyholder’s Fund
F. In case of Partial Withdrawals: For 2 years period from the date of withdrawal, the sum
assured under the basic plan shall be reduced to the extent of the amount of partial withdrawals
made.
II. Where the policy lapses without payment of at least 3 years’ premiums, the Life
Cover, Accident Benefit / Critical Illness Benefit rider covers, if any, shall cease and no
charges for these benefits shall be deducted. However, deduction of all the other charges
shall continue. The benefits under such a lapsed policy shall be payable as under:
G. In case of Death: The Policyholder’s Fund Value.
H. In case of death due to accident: Only, the amount as under G above.
I. In case of Critical Illness claim: Nil
J. In case of Surrender (including Compulsory surrender): Policyholder’s Fund Value /
monetary value as the case may be, shall be payable after the completion of the third policy
anniversary. No amount shall be payable within 3 years from the date of commencement of
policy.
K. In case of Partial withdrawal: Partial Withdrawals shall not be allowed under such a
• Revival: If due premium is not paid within the days of grace, the policy lapses. A lapsed
policy can be revived during the period of two years from the due date of first unpaid
premium or before maturity, whichever is earlier. The period during which the policy can
be revived will be called “Period of revival” or “revival period”.
If premiums have not been paid for atleast 3 full years, the policy may be revived within two
date of maturity, if earlier. No proof of continued insurability shall be required and all arrears of
premium without interest shall be required to be paid.
thereafter revival will not be entertained. If 3 years or more than 3 years premiums have been
terminate and Policyholder’s Fund Value as on such date shall be refunded to the Life Assured
• Settlement Option: When the policy comes for maturity, you may exercise “Settlement
Option” and may receive the policy money in instalments spread over a period of not
more than five years from the date of maturity. There shall not be any life cover during
this period. The value of instalment payable on the date specified shall be subject to
investment risk i.e. the NAV may go up or down depending upon the performance of the
fund.
4. Reinstatement:
1. LIC’s Money Plus - I is a Unit Linked Life Insurance products which is different
from the traditional insurance products and are subject to the risk factors.
2. The premium paid in Unit Linked Life Insurance policies are subject to
investment risks associated with capital markets and the NAVs of the units may
go up or down based on the performance of fund and factors influencing the
capital market and the insured is responsible for his/her decisions.
3. Life Insurance Corporation of India is only the name of the Insurance Company
and LIC’s Money Plus - I is only the name of the unit linked life insurance
contract and does not in any way indicate the quality of the contract, its future
prospects or returns.
4. Please know the associated risks and the applicable charges, from your Insurance
agent or the Intermediary or policy document of the insurer.
5. The various funds offered under this contract are the names of the funds and do
not in any way indicate the quality of these plans, their future prospects and
returns.

If you are not satisfied with the “Terms and Conditions” of the policy, you may return the
policy to us within 15 days. The amount to be refunded in case the policy is returned
within the cooling-off period shall be determined as under:
Plus PolicyAdministration charge deducted Less charges @ Rs.0.20per thousand Sum
Assured under Basic plan
7. Loan:
8. Assignment:
9. Exclusions:
In case the Life Assured commits suicide at any time within one year, the Corporation
will not entertain any claim by virtue of the policy except to the extent of the
Policyholder’s Fund Value on death.
Child Fortune Plus

LIC’s Child Fortune Plus is a unit linked plan which offers you a solution to meet your child’s
educational and other needs. You can insure yourself under this plan if you are the parent of a
child upto the age of 17 years last birthday in case of single premium policies and age of 10
years last birthday in case of regular premium policies. The child named under the policy shall
be the nominee. There will not be any insurance coverage on the life of the child, but the policy
will be allowed based on the age of the child. The policy will continue till the child attains the
age of 25 years last birthday or till you (life assured) attain the age of 75 years nearest birthday,
You can pay the premiums either in lump sum (single premium) or regularly throughout policy
term. The death benefit under the policy shall be the Sum Assured. You can choose the level of
cover (Sum Assured) within the limits, which will depend on whether the policy is a Single
premium or Regular premium contract, your age and the amount of premium you agree to pay. In
addition, for regular premium policies, in case of death of the life assured during the term of the
policy, the plan also provides for waiver of all future premiums including outstanding premiums,
if any, provided life cover is in force.
You will also have an option to make additional investments under the policy through Top-up
premiums.
1. Payment of Premiums: You may pay premiums regularly at yearly, half-yearly, quarterly or
monthly (through ECS mode only) intervals over the term of the policy. Alternatively, a Single
premium can be paid .
2. Eligibility Conditions and Other Restrictions:

(a) Minimum Age at entry for Life Assured - 18 years (age last birthday)
(b) Maximum Age at entry for Life Assured - 55 years (age nearer birthday)
(c) Minimum Age at entry for child - 0 years (age last birthday)
(d) Maximum Age at entry for child -
Regular premium: [10] last birthday
Single premium: [17] last birthday
(e) Maximum Maturity Age - [25] last birthday of child or [75] nearest
birthday of life assured, whichever is earlier
(f) Policy Term - (25 – age last birthday at entry of life
assured’s child) or (75 - age nearest birthday at entry of life assured), whichever is lower
(g) Minimum Premium –
Regular Premium Policies (other than monthly (ECS) mode): Rs. [10,000] p.a
Regular premium (for monthly (ECS) mode): Rs. [1,000] p.m
Single Premium Policies: Rs. [40,000] p.a.
(h) Sum Assured -
Single Premium :
Minimum Sum assured : 1.25 times the single premium.
Maximum Sum assured :
5 times of the single premium if age at entry is upto 35 years
2.5 times of the single premium if age at entry is from 36 to 45 years
1.25 times of the single premium if age at entry is 46 years and above
Regular Premium :
Minimum Sum assured : 5 times the annualised premium.
Maximum Sum assured :
25 times of the annualized premium if age at entry is upto 45 years
15 times of the annualized premium if age at entry is 46 years and above
3. Other Features:
• Top-up (Additional Premium): You can pay Top-up premium in multiples of

Rs.1,000/- at anytime during the term of the policy without increasing the sum assured. In
case of yearly, half-yearly, quarterly or monthly (ECS) mode of premium payment such
Top-up can be paid only if all due premiums have been paid under the policy. At any
point of time, the total of top-up premiums payable cannot exceed 25% of total amount of
regular premiums paid up to that date or single premium paid.
• Partial Withdrawals: Youmay encash the units partially after the third policy
1. Partial withdrawals may be in the form of fixed amount or in the form of fixed number of
units.
2. Under regular premium policies where premiums have been paid for less than 3 years’
and further premiums are not paid, the partial withdrawal shall not be allowed.
3. Under regular premium policies where atleast 3 years’ premiums have been paid, partial
withdrawal will be allowed subject to a minimum balance of two annualized premiums in
the Policyholder’s Fund Value.
minimum balance of Rs. 5000/- in the Policyholder’s Fund or 10% of single premium,
whichever is higher.
5. Partial withdrawal from Policyholder’s Fund pertaining to top-up premiums shall be
allowed only after completion of three years from the date of allocation of that top-up
premium. This condition will not apply if the top-up premiums are paid during the last
three years of the policy term.
6. After the death of life assured during the policy term, partial withdrawal may be made by
the child named in the policy if he/she is major i.e. after completion of 18 years of age or
by the appointee if the child is a minor subject to an undertaking by the appointee that the
withdrawal is solely for the benefit of the named child.
• Switching: You can switch between any fund types for the entire Fund Value during the
policy term. Within a given policy year, 4 switches will be allowed free of charge.
Subsequent switches shall be subject to a switching charge of Rs.100 per switch.
plan. You can, however, decrease any or all of the risk covers within the specified limit
once in a year during the Policy term, provided all the premiums due under the Policy
have been paid. The reduced levels of cover will be available within the limits specified
in para 3 above. Further, once the risk cover has been reduced, the same cannot be
• Option to continue the cover after the revival period: If atleast three years’ premiums
have been paid under the policy, you may opt for continuation of cover even beyond the
revival period without reviving the policy and paying any further premiums. This option
shall be required to be exercised atleast one month before the completion of the revival
period. If this option is availed, the cover under the policy shall continue by deduction of
relevant charges out of policy fund. This option shall be continued till the Policyholder’s
Fund Value reaches one annualized premium. No further premiums shall be allowed to be
paid after the revival period is over.

I) Where atleast 3 years’ premiums have been paid, and the policy lapses, the Life Cover and
Premium Waiver Benefit cover shall continue during the revival period.
During this period, the mortality charges shall be taken, as usual, in addition to other charges, by
cancelling an appropriate number of units out of the Policyholder’s Fund Value every month.
This will continue to provide relevant risk covers for :

annualized premium,
Further, the life assured may opt for continuation of cover even beyond the revival period
without reviving the policy. This option shall be required to be exercised atleast one month
before the completion of the revival period. If this option is availed, the life cover and cover for
waiver of premiums under the policy shall continue by deduction of relevant charges out of
policy fund. This option shall continue till the Policyholder’s Fund Value reaches one annualized
premium. No further premiums shall be allowed to be paid after the revival period is over.
The benefits payable under the policy in different contingencies during the abovesaid period
shall be as under:
A) In case of death of Life Assured, if the child is alive: Sum Assured shall be paid to the
nominee and payment of all future premiums due under the policy (in case of regular premium
policies) shall be waived. Units equivalent to an amount equal to all future premiums including
outstanding premiums, if any, (i.e. sum total of all premiums payable under the policy – total
premiums paid under the policy) shall be credited to the policyholder’s fund. The units shall be
allocated at the unit price applicable for the fund type opted for under the policy on the date of
notification of death. The policy shall continue.
B) In case of death of the Life Assured, after the death of the child: Sum Assured plus
Policyholder’s Fund Value together with an amount equal to all future premiums including
outstanding premiums, if any, (i.e. sum total of all premiums payable under the policy – total
premiums paid under the policy) shall be payable to the nominee/ legal heir, as the case may be,
at that time and the policy shall terminate.
C) In case of death of child before life assured’s death: The policy will continue till maturity
or till the life assured survives, which ever is earlier.
D) In case of death of child after life assured’s death: An amount equal to the Fund Value of
units shall be payable to the legal heir of life assured and the policy shall terminate.
E) On maturity: The Policyholder’s Fund Value.
F) In case of Surrender (including Compulsory Surrender): The Policyholder’s Fund Value.

The Surrender value, however, shall be paid only after the completion of 3 policy years.
G) In case of Partial Withdrawals: Partial withdrawals shall be allowed subject to a minimum

balance of two annualized premiums in the Policyholder’s Fund Value.
II) Where at least 3 years’ premiums are not paid, and the policy lapses, the Life Cover and
Premium Waiver Benefit cover shall cease and no charges for these benefits shall be deducted.
However, deduction of all the other charges shall continue. The benefits under such a lapsed
policy shall be payable as under:
H) In case of Death of Life Assured: The Policyholder’s Fund Value.

I) In case of Surrender (including Compulsory Surrender): Policyholder’s Fund Value /
monetary value of units, as the case may be, shall be payable after the completion of the third
policy anniversary. No amount shall be payable within 3 years from the date of commencement
of policy.
J) In case of Partial withdrawal: Partial Withdrawals shall not be allowed under such a policy
even after completion of 3 years period.
policy can be revived during the period of two years from the due date of first unpaid
premium or before maturity, whichever is earlier. The period during which the policy can
be revived will be called “Period of revival” or “revival period”.
thereafter revival will not be entertained. If 3 years’ or more than 3 years’ premiums have been
terminate and Policyholder’s Fund Value as on such date shall be refunded to the Policyholder
• Settlement Option: When the policy comes for maturity, the life assured, if he/she is
alive, otherwise the child named in the policy, may exercise “Settlement Option” and
may receive the policy money in instalments spread over a period of not more than five
years from the date of maturity. There shall not be any life cover during this period. The
value of instalment payable on the date specified shall be subject to investment risk i.e.
the NAV may go up or down depending upon the performance of the fund.
4. Reinstatement:
a. LIC’s Child Fortune Plus is a Unit Linked Life Insurance products which is different from the
traditional insurance products and are subject to the risk factors.
b. The premium paid in Unit Linked Life Insurance policies are subject to investment risks
associated with capital markets and the NAVs of the units may go up or down based on the
performance of fund and factors influencing the capital market and the policyholder is
c. Life Insurance Corporation of India is only the name of the Insurance Company and LIC’s
Child Fortune Plus is only the name of the unit linked life insurance contract and does not in any
way indicate the quality of the contract, its future prospects or returns.
d. Please know the associated risks and the applicable charges, from your Insurance agent or the
Intermediary or policy document of the insurer.
e. The various funds offered under this contract are the names of the funds and do not in any way
indicate the quality of these plans, their future prospects and returns.
f. All benefits under the policy are also subject to the Tax Laws and other financial enactments as
they exist from time to time.

Less charges @ Rs.0.20per thousand Sum Assured under Basic plan
7. Loan:
8. Assignment:
No assignment will be allowed under this plan.
9. Exclusions:
entertain any claim by virtue of the policy except to the extent of the Policyholder’s Fund Value
on death.
Jeevan Saathi Plus

LIC’s Jeevan Saathi Plus is a unit linked plan wherein a couple can take the insurance cover on
their lives under a single policy. The proposer under the plan shall be called Principal Life
Assured (P.L.A.) and the other life (wife/husband) shall be called Spouse Life Assured (S.L.A.).
The premiums can be paid either in lump sum (single premium) or regularly throughout policy
term. The P.L.A. can choose the level of cover (Sum Assured) for both lives within the limits,
which will depend on whether the policy is a Single premium or Regular premium contract, age
and the amount of premium agreed to pay. For regular premium policies, in case of death of the
P.L.A. during the term of the policy, the plan also provides for waiver of all future premiums
including outstanding premiums, if any, provided life cover is in force.
P.L.A. will also have an option to make additional investments under the policy through Top-up
premiums.
1. Payment of Premiums: P.L.A. may pay premiums regularly at yearly, half-yearly, quarterly
or monthly (through ECS mode only) intervals over the term of the policy. Alternatively, a
Single premium can be paid.
2. Eligibility Conditions and Other Restrictions:

(a) Minimum Age at entry - 18 years (completed)
(b) Maximum Age at entry - 55 years (age nearer birthday)
(c) Maximum Maturity Age - 70 years (age nearer birthday)
(d) Policy Term -
Regular premium: [10, 15 to 20] years
Single premium: [10 to 20] years
(e) Minimum Premium -
Regular premium (other than monthly (ECS) mode):
Rs. [15,000] p.a. for policy term 10 years
Regular premium (for monthly (ECS) mode):

Rs. [1,000] p.m. for policy term 15 to 20 years
Rs. [1,500] p.m. for policy term 10 years
Single premium: Rs. [40,000]

(f) Minimum Sum Assured -
Regular Premium: 5 times the annualized premium for each of P.L.A and S.L.A.
Single Premium: 1.25 times the single premium for each of P.L.A and S.L.A.
(g) Maximum Sum assured -
Inclusive of both Principal Life Assured and Spouse Life assured, subject to the minimum sum
assured condition as e) above.
Regular Premium:
30 times the annualized premium if age at entry for both the lives is upto 40 years
20 times the annualized premium if age at entry for any one of the lives is 41 years and above
Single Premium:
5 times the single premium if age at entry for both the lives is upto 40 years
2.5 times the single premium if age at entry for any one of the lives is 41 years and above
Further the sum assured for the spouse shall be less than or equal to the Principal Assured subject
to the minimum sum assured condition.
3. Other Features:
• Top-up (Additional Premium): P.L.A. can pay Top-up premium in multiples of

Rs.1,000/- at anytime during the term of the policy without increasing the sum assured. In
case of yearly, half-yearly, quarterly or monthly (ECS) mode of premium payment such
Top-up can be paid only if all due premiums have been paid under the policy. At any
point of time, the total of top-up premiums cannot exceed 25% of total amount of regular
premiums paid upto that date or 25% of single premium paid.
Top-up premium shall not be allowed to be paid after the death of P.L.A.
• Partial Withdrawals: P.L.A.may encash the units partially after the third policy
Partial withdrawals may be in the form of fixed amount or in the form of fixed number of
units.
1. Under regular premium policies where premiums have been paid for less than 3 years’
and further premiums are not paid, the partial withdrawal shall not be allowed.
2. Under regular premium policies where atleast 3 years’ premiums have been paid, partial
withdrawal will be allowed subject to a minimum balance of two annualized premiums in
the Policyholder’s Fund Value.
minimum balance of Rs. 5000/- in the Policyholder’s Fund or 10% of single premium,
whichever is higher.
4. Partial withdrawal from Policyholder’s Fund pertaining to top-up premiums shall be
allowed only after completion of three years from the date of allocation of that top-up
premium. This condition will not apply if the top-up premiums are paid during the last
three years of the policy term.
5. If death benefit sum assured is transferred to the Policyholder’s Fund on death of either
P.L.A. or S.L.A., the same shall be allowed to be withdrawn from the fund without any
restriction of three years waiting period.
6. After the death of P.L.A. during the policy term, the S.L.A. can partially withdraw the
units subject to the conditions (i) to (vi) mentioned above.
• Switching: The policyholder (i.e. P.L.A. or if P.L.A. is not alive, then S.L.A.) can switch
between any fund types during the policy term. Within a given policy year, 4 switches
will be allowed free of charge. Subsequent switches shall be subject to a switching charge
of Rs.100 per switch.
plan. The P.L.A. can, however, decrease the risk covers for the self, spouse or for both
once in a year during the Policy term, provided all the premiums due under the Policy
have been paid. The reduced levels of cover will be available within the limits specified
in para 3 above. Further, once the risk cover has been reduced, the same cannot be
• Option to transfer the Death Benefit sum assured to the Policyholder’s Fund: On the
death of either the P.L.A. or S.L.A., the surviving life shall have an option of not taking
the death benefit (Sum Assured) immediately but can transfer the same to the
Policyholder’s Fund. This option has to be exercised along with death intimation. This
amount may be withdrawn in full or partially from the Policyholder’s fund by way of
Partial withdrawals at any time in future without any restriction of three years waiting
period.
• Option to continue the cover after the revival period: If atleast three years’ premiums
have been paid under the policy, P.L.A. may opt for continuation of cover beyond the
revival period without reviving the policy and paying any further premiums. This option
shall be required to be exercised atleast one month before the completion of the revival
period. If this option is availed, the cover under the policy shall continue by deduction of
relevant charges out of policy fund. This option shall be continued till the Policyholder’s
Fund Value reaches one annualized premium. No further premiums shall be allowed to be
paid after the revival period is over.

Where atleast 3 years’ premiums have been paid, and the policy lapses, the Life Cover and
Premium Waiver Benefit cover shall continue during the revival period.
During this period, the mortality charges shall be taken, as usual, in addition to other charges, by
cancelling an appropriate number of units out of the Policyholder’s Fund Value every month.
This will continue to provide relevant risk covers for:

annualized premium,
Further, the P.L.A. may opt for continuation of cover beyond the revival period without reviving
the policy. This option shall be required to be exercised atleast one month before the completion
of the revival period. If this option is availed, the life cover and cover for waiver of premiums
under the policy shall continue by deduction of relevant charges out of policy fund. This option
shall continue till the Policyholder’s Fund Value reaches one annualized premium. No further
premiums shall be allowed to be paid after the revival period is over.
The benefits payable under the policy in different contingencies during the above said period
shall be as under:
a. In case of death of P.L.A. while S.L.A. is alive: Sum Assured as applicable to P.L.A.
shall be payable to the S.L.A. and payment of all future premiums due under the policy shall be
waived. Units equivalent to an amount equal to all future premiums including outstanding
premiums, if any, (i.e. sum total of all premiums payable under the policy less total premiums
paid under the policy) shall be credited to the policyholder’s fund. The units shall be allocated at
the unit price applicable for the fund type opted for under the policy. The policy shall continue.
b. In case of death of P.L.A. after the death of S.L.A.: Sum Assured as applicable to
P.L.A. plus policyholder’s fund value together with an amount equal to all future premiums
including outstanding premiums, if any, (i.e. sum total of all premiums payable under the policy
less total premiums paid under the policy) shall be payable and the policy shall terminate.
c. In case of death of S.L.A. while P.L.A. is alive: Sum Assured as applicable to S.L.A.
shall be payable to P.L.A.
d. In case of death of S.L.A. after the death of P.L.A.: Sum Assured as applicable to
S.L.A. plus policyholder’s fund value shall be payable and the policy shall terminate.
e. On Simultaneous death of P.L.A. and S.L.A.: Sum Assureds as applicable to both
P.L.A. and S.L.A. plus policyholder’s fund value together with an amount equal to all future
premiums including outstanding premiums, if any, shall be payable and the policy shall
terminate.
f. On maturity: The Policyholder’s Fund Value.
g. In case of Surrender (including Compulsory Surrender): The Policyholder’s Fund
h. In case of Partial Withdrawals: Partial withdrawals shall be allowed subject to a
minimum balance of two annualized premiums in the Policyholder’s Fund Value.
i. Where the policy lapses without payment of at least 3 years’ premiums, the Life Cover
and Premium Waiver Benefit cover shall cease and no charges for these benefits shall be
deducted. However, deduction of all the other charges shall continue. The benefits under such a
lapsed policy shall be payable as under:
j. In case of death of P.L.A. while S.L.A. is alive: Policyholder’s Fund Value is payable
and the policy will terminate.
k. In case of death of P.L.A. after the death of S.L.A.: Policyholder’s Fund Value is
payable and the policy will terminate.
l. In case of death of S.L.A. while P.L.A. is alive: Nil.
m. On Simultaneous death of P.L.A. and S.L.A.: Policyholder’s Fund Value is payable
and the policy will terminate.
n. In case of Surrender (including Compulsory Surrender): Policyholder’s Fund Value /
monetary value of units, as the case may be, shall be payable after the completion of the third
policy anniversary. No amount shall be payable within 3 years from the date of commencement
of policy.
o. In case of Partial withdrawal: Partial Withdrawals shall not be allowed under such a
policy can be revived by P.L.A. during the period of two years from the due date of first
unpaid premium or before maturity, whichever is earlier. The period during which the
policy can be revived will be called “Period of revival” or “revival period”.
proof of continued insurability on both the lives to the satisfaction of the Corporation and the
payment of all the arrears of premium without interest.
by the Corporation and is specifically communicated in writing to the P.L.A.
thereafter revival will not be entertained. If 3 years’ or more than 3 years’ premiums have been
terminate and Policyholder’s Fund Value as on such date shall be refunded to the P.L.A. or if
P.L.A. is not alive, then S.L.A. and thereafter revival will not be allowed.
• Settlement Option: When the policy comes for maturity, the policyholder (i.e. P.L.A. or
if P.L.A. is not alive, then S.L.A.) may exercise “Settlement Option” and may receive the
policy money in instalments spread over a period of not more than five years from the
date of maturity. During the Settlement Option period no charges other than the Fund
Management Charge shall be deducted. There shall not be any life cover during this
period. The value of instalment payable on the date specified shall be subject to
investment risk i.e. the NAV may go up or down depending upon the performance of the
fund.
4. Reinstatement:
1. LIC’s Jeevan Saathi Plus Plan is a Unit Linked Joint Life Insurance product which is
different from the traditional insurance products and is subject to the risk factors.
the performance of fund and factors influencing the capital market and the policyholder is
LIC’s Jeevan Saathi Plus is only the name of the unit linked life insurance contract and
does not in any way indicate the quality of the contract, its future prospects or returns.

Less charges @ Rs.0.20per thousand Sum Assured of P.L.A. and S.L.A. taken together
Less Actual cost of medical examination and special reports, if any, for both the lives.
7. Loan:
8. Assignment:
9. Exclusions:
In case the P.L.A. commits suicide at any time within one year, the Corporation will not entertain
any claim by virtue of the policy except to the extent of the Policyholder’s Fund Value on death
and in case S.L.A. commits suicide at any time within one year, the Corporation will not
entertain any claim by virtue under the policy.
ULIPs vs Mutual Funds: Who's better?
Unit Linked Insurance Policies (ULIPs) as an investment avenue are closest to mutual funds in
terms of their structure and functioning. As is the case with mutual funds, investors in ULIPs are
allotted units by the insurance company and a net asset value (NAV) is declared for the same on
a daily basis.
Similarly ULIP investors have the option of investing across various schemes similar to the ones
found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to
name a few. Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance
component.
However it should not be construed that barring the insurance element there is nothing
differentiating mutual funds from ULIPs.
Despite the seemingly comparable structures there are various factors wherein the two differ.
Mode of investment/ investment amounts
Mutual fund investors have the option of either making lump sum investments or investing using
the systematic investment plan (SIP) route which entails commitments over longer time
horizons. The minimum investment amounts are laid out by the fund house.
ULIP investors also have the choice of investing in a lump sum (single premium) or using the
conventional route, i.e. making premium payments on an annual, half-yearly, quarterly or
monthly basis. In ULIPs, determining the premium paid is often the starting point for the
investment activity.
ULIP investors also have the flexibility to alter the premium amounts during the policy's tenure.
For example an individual with access to surplus funds can enhance the contribution thereby
ensuring that his surplus funds are gainfully invested; conversely an individual faced with a
liquidity crunch has the option of paying a lower amount (the difference being adjusted in the
accumulated value of his ULIP). The freedom to modify premium payments at one's
convenience clearly gives ULIP investors an edge over their mutual fund counterparts.
Expenses
In mutual fund investments, expenses charged for various activities like fund management, sales
and marketing, administration among others are subject to pre-determined upper limits as
prescribed by the Securities and Exchange Board of India.
For example equity-oriented funds can charge their investors a maximum of 2.5% per annum on
a recurring basis for all their expenses; any expense above the prescribed limit is borne by the
fund house and not the investors.
Similarly funds also charge their investors entry and exit loads (in most cases, either is
applicable). Entry loads are charged at the timing of making an investment while the exit load is
charged at the time of sale.
Insurance companies have a free hand in levying expenses on their ULIP products with no upper
limits being prescribed by the regulator, i.e. the Insurance Regulatory and Development
Authority. This explains the complex and at times 'unwieldy' expense structures on ULIP
offerings. The only restraint placed is that insurers are required to notify the regulator of all the
expenses that will be charged on their ULIP offerings.
Expenses can have far-reaching consequences on investors since higher expenses translate into
lower amounts being invested and a smaller corpus being accumulated.
Portfolio disclosure
Mutual fund houses are required to statutorily declare their portfolios on a quarterly basis, albeit
most fund houses do so on a monthly basis. Investors get the opportunity to see where their
monies are being invested and how they have been managed by studying the portfolio.
There is lack of consensus on whether ULIPs are required to disclose their portfolios.
While one school of thought believes that disclosing portfolios on a quarterly basis is mandatory,
the other believes that there is no legal obligation to do so and that insurers are required to
disclose their portfolios only on demand.
Some insurance companies do declare their portfolios on a monthly/quarterly basis. However the
lack of transparency in ULIP investments could be a cause for concern considering that the
amount invested in insurance policies is essentially meant to provide for contingencies and for
long-term needs like retirement; regular portfolio disclosures on the other hand can enable
investors to make timely investment decisions.
Flexibility in altering the asset allocation
As was stated earlier, offerings in both the mutual funds segment and ULIPs segment are largely
comparable. For example plans that invest their entire corpus in equities (diversified equity
funds), a 60:40 allotment in equity and debt instruments (balanced funds) and those investing
only in debt instruments (debt funds) can be found in both ULIPs and mutual funds.
If a mutual fund investor in a diversified equity fund wishes to shift his corpus into a debt from
the same fund house, he could have to bear an exit load and/or entry load.
On the other hand most insurance companies permit their ULIP inventors to shift investments
across various plans/asset classes either at a nominal or no cost (usually, a couple of switches are
allowed free of charge every year and a cost has to be borne for additional switches).
Effectively the ULIP investor is given the option to invest across asset classes as per his
convenience in a cost-effective manner.
This can prove to be very useful for investors, for example in a bull market when the ULIP
investor's equity component has appreciated, he can book profits by simply transferring the
requisite amount to a debt-oriented plan.
Tax benefits
ULIP investments qualify for deductions under Section 80C of the Income Tax Act. This holds
good, irrespective of the nature of the plan chosen by the investor. On the other hand in the
mutual funds domain, only investments in tax-saving funds (also referred to as equity-linked
savings schemes) are eligible for Section 80C benefits.
Maturity proceeds from ULIPs are tax free. In case of equity-oriented funds (for example
diversified equity funds, balanced funds), if the investments are held for a period over 12
months, the gains are tax free; conversely investments sold within a 12-month period attract
short-term capital gains tax @ 10%.
Similarly, debt-oriented funds attract a long-term capital gains tax @ 10%, while a short-term
capital gain is taxed at the investor's marginal tax rate.
Despite the seemingly similar structures evidently both mutual funds and ULIPs have their
unique set of advantages to offer. As always, it is vital for investors to be aware of the nuances in
both offerings and make informed decisions.
Insurance industry in India has not taken off to a desired level, as is seen in the western
countries. This leaves a lot of scope for innovation and experimentation, especially in
products. Unit linked insurance plan (ULIP) is one such example. It is always marketed as a
high-return product, but it does not come without its disadvantage – its hefty charges. Currently,
there is no cap on the amount of charges being levied by insurers on ULIPs. But investors see a
ray of hope in the ruling of the Insurance Regulatory and Development Authority (IRDA) which
limit the initial charges.
What is the IRDA ruling?

The IRDA ruling says that life insurance companies can charge up to 3 per cent on gross yield of
insurance policies up to 10 years and 2.25 per cent on policies with a term over 10 years,
effective from Oct 01.
Let us assume these are the total charges, of which the fund management charges should not
exceed 1.5 per cent and 1.25 per cent for policies up to 10 years and above 10 years,
respectively.
The ruling helps promote ULIP as a long-term investment product by lowering charges for
policies with a term of 10 years or more than that. Let us see how.
On an average, the running costs of ULIPs in India work out to around 3.75 per cent of gross
yield of policies with a term of 10 years. As per the new ruling, a fund earning gross yield of 15
per cent has to give a net yield of 12.75 per cent back to investors for a 10-year ULIP. Gross
yield is the yield that does not take into account any charges while net yield takes into account all
charges. Thus, the directive will help investors get an extra 1.5 per cent return on long-term
policies.
Analysis
Let’s consider an example. Ramesh, 27, bought a ULIP with an annual premium of Rs 10,000 for
20 years.
The charge structure is as below:
Premium allocation charges – 20 per cent (1st year), 5 per cent (2nd, 3rd year), and 2 per cent
(remaining tenure)
Policy administration charge – Rs 60 per month (for the entire term)
Mortality charges – 0.142-0.389 per cent (taken from a standard ULIP; it may vary across
products and age groups).
Fund management charge – 1.50 per cent (since it is an equity-oriented (growth) fund)
We have assumed that the fund would grow at 10 per cent, annually.
The fund value at the end of 20th year taking into account all charges is Rs 4.09 lakh while
without charges grows to Rs 6.3 lakh. So, the net yield comes at 6.41 per cent. Now, the
difference between gross yield and net yield is (10 – 6.41) per cent = 3.59 per cent.
Effect of current ruling
As per IRDA’s latest ruling, investors stand to get extra returns. In the above example, the yield
difference of 3.59 per cent should come down to 2.25 per cent, which means a significant rise in
yields up to 1.34 per cent for Ramesh. Refer Table 1 which explains the effect of recent ruling on
the fund value on maturity.
Table 1: An Annual Premium of Rs 10,000 for 20 Years for a Sum
Assurance of Rs 5 lakh
Death
Investment Gross Net Current Fund ValueBenefit
(Rs) Yield Yield Expenses (Rs) (Rs)
ULIP
Investment
Pre Oct 01,
2009 10,000.00 10% 6.41% 3.59% 4,09,261.00 5,00,000
Post Oct 01,
2009 10,000.00 10% 7.75% 2.25% 4,79,640.73 5,00,000
Benefit received after recent IRDA ruling→ 70,379.73
Mutual Fund Investment with a Term Plan of Rs 5 lakh for 20
Years
Post Aug 01,
2009* 10,000.00 10% 8.00% 2.00% 4,08,541 9,08,541
* Scrapping of entry load in mutual fund investments post August 01, 2009
The return Ramesh would get before Oct 1, the IRDA ruling date, would be Rs 4,09,261, while
the return after the ruling comes into effect would be Rs 4,79,640.73, a gain of Rs 70,379.73 on
an annual investment of Rs 10,000 for a tenure of 20 years.
How will insurance companies achieve this?
Insurance companies are having tough time managing their expenses as the overall premium
growth rate has declined in the recent quarters. To bring down the cost, the companies have to
reduce the premium allocation charges as also premium administration charges. The fund
management charges will have to be kept at 1.25 per cent as directed by IRDA against the
market practice of 1.5-2.50 per cent.
ULIP vs mutual fund investments
Now let us compare a ULIP with a mutual fund investment. As per Table 1, an annual
investment of Rs 10,000 in a mutual fund for a term of 20 years along with a term plan of Rs 5
lakh (@ Rs 1,322 for the age of 27 years for a tenure 20 years) pays out Rs 4.09 lakh on
maturity, considering 2 per cent as expense ratio (charges incurred by mutual funds like fund
management charges, AMC charge, trailing fees, etc.), which is considerably less than the ULIP
maturity amount of Rs 4.79 lakh post the IRDA ruling. But the death benefit in case of mutual
fund would be Rs 9.17 lakh against Rs 5 lakh in ULIP investments.
It means in ULIP investments, though the charges are initially high, they get spread over a longer
period. But a mutual fund investment for a short tenure, say 5 years, will give a higher amount
on maturity when compared with ULIP investments for the same tenure as initial charges (3%-
5%) are high in ULIP.
Conclusion
IRDA acted well in time by capping the charges on ULIP and weaning away business from
mutual fund players who ,unhappy with the SEBI ruling of scrapping the entry load on mutual
fund investments, are scrambling to keep their business running. Though finance experts say that
insurance and investment objectives should not be mixed, if selected well a ULIP can help
investors achieve both these goals, especially building wealth.
ULIPs Vs MFs
Returns- Returns-
Balanced Balenced
1year(%) 1year(%)
HDFC Life Balanced SBI Magnum Balanced
25.47
Managed Fund Fund - Growth 55.4874
Kotak Mahindra Safe
Investment Plan Balanced 19.10 Kotak Balance-Growth 45.048
Fund
Max New York Balanced HDFC Balanced Fund -
18.58 27.0674
Fund Growth
Equity Equity
SBI Magnum Global
HDFC Life Growth Fund 50.56 82.5431
Fund 94 - Growth
ICICI Pru Life Link 2 Birla Mid Cap Fund -
36.78 53.0206
Maximiser Growth Growth
Kotak Mahindra Safe
Investment Plan Aggressive 32.75 HDFC Tax Saver Fund 74.84
G
SBI Magnum Tax Gain 96.05
Debt Debt
ICICI Pru Life link 2 Kotak Bond Deposit -
4.56 6.2396
Protector Income Growth
Kotak Mahindra Safe
Birla Income Plus -
Investment Plan - Bond 5.35 5.2307
Growth
Fund
The Controversy
Bars 14 Insurers from selling ULIPs
• Aegon Religare
• Aviva
• Bajaj Allianz
• Bharti AXA
• Birla Sun Life
• HDFC Standard Life
• Kotak Mahindra Old Mutual Life
• Reliance Life
• SBI Life
• Tata AIG Life
• Metlife India
• Max New York Life
• ICICI Prudential
• ING Vysya Life

The controversy regarding control of ULIP between SEBI and IRDA
 Genesis of the controversy
At present, over 70% of the new business premium for most insurance companies comes from
ULIPs, running into thousands. The genesis of the Sebi order goes back to the feud between MFs
and insurance companies.
When the latter started issuing ULIPs about 5-6 years ago, offered huge commissions to
insurance agents and flooded the market with these products which nearly mirrored mutual fund
(MF) products. ULIPs are products that combine insurance and investment for the insured and
are mostly market-linked.
Between 2005 and 2008, when the stock market was on a bull run, MFs lost business but
insurance companies mopped up large sums of money through ULIPs.
In December 2009 and January 2010, Sebi had issued show cause notices to 14 insurance
companies asking them why action should not be initiated against them for issuing investment
products without Sebi’s permission.
Then IRDA asked all the 14 companies to continue with their business as usual,
"notwithstanding the order of Sebi”. "The IRDA is satisfied that the order of Sebi will bring the
insurance industry to a standstill which would not be in public interest and would be detrimental
to the interests of the policyholders and prejudicial to the interests of the insurers," the mail
noted. Hence, IRDA "directed to note" all the insurance companies that "they shall continue to
carry out insurance business as usual including offering, marketing and servicing ULIPs in
accordance with the Insurance Act, 1938, Rules, Regulations and Guidelines issued there under
by the IRDA."
Four days later, Sebi modified its order and exempted all existing ULIPs from the ban but
maintained that its prior permission was mandatory for issuing new ULIPs.
Then SEBI and IRDA moved to Supreme court to get regulatory control of ULIPs.
 Argument for and against giving control with SEBI, IRDA or both
Argument for SEBI
 One of the main contentions for Sebi was that although a ULIP is an insurance
product which comes under IRDA, part of it is also an investment product which
should ideally be regulated by Sebi
 ULIPs have been in news for all the wrong reasons for a very long time because of
mis-selling (promising of returns, selling it as a short term investment) by agents
especially because of the fact that agents are not receiving commission on the sale of
mutual fund products. Also there is very little transparency on the cost-allocation
affecting returns for the investors. IRDA has been working towards making this
product more transparent but not to the satisfaction of the investor community. On the
other hand, Sebi has done a good job on regulating mutual funds so Sebi's move to
regulate ULIPs may be a blessing in disguise for ULIP investors.
 Sebi is of the opinion that because as ULIP has an investment component, it is akin to
a mutual fund investment and hence needs to be regulated and registered with the
market regulator. The Sebi Act clearly states that any product with exposure to the
securities market comes under its purview and ULIP has exposure to the securities
market.
Argument for IRDA
• IRDA believes that directive by Sebi will harm the insurance industry, since a
significant portion of life insurance business comes from this product. Investor
interest will also get affected as drying of revenues could disrupt payment of
benefits on maturity, death, etc.
• Ulips globally are managed by insurance regulators.
• Besides, insurance laws permit companies to sell an investment component along

with insurance. After all, LIC has been doing so for years only difference being
ULIPs have stock market risk which is borne by the buyer and not the insurance
company
 Decision of government
20th June, 2010.
Insurance industry regulator Irda has emerged the victor in a high-profile tussle over the
regulation of so-called unit-linked insurance plans or Ulips, with the government ruling that it
and not the market watchdog Sebi would oversee the product.
The government is “clarifying by way of an explanation that life insurance business shall include
any unit-linked insurance policy or scripts or any such instruments,’’ said a statement from the
press information bureau. “This would set at rest all the issues regarding Ulips between the two
financial regulators.’’
The government promulgated an ordinance late on Friday to amend four major laws that could
revive the sale of Ulips and force the mutual fund industry to look for new avenues to get
investors.
This will completely end the uncertainty regarding unit linked insurance plans. Ulips have also
turned extremely customer-friendly after recent measures taken by the regulator to bring down
surrender charges.
Irda and Sebi got into a legal battle over Ulips regulation after the markets regulator on April 9
banned 14 insurers from selling Ulips. Sebi withdrew the ban when bureaucrats brokered a truce,
but only to revive it. Sebi moved the Supreme Court to club various public interest litigations
against Ulips and resolve the issue of alleged mis-representation and the issue of jurisdiction.
The Supreme Court will have to take cognisance of the Ordinance when it hears the case on July
8. The government’s clarification will enhance policy holder confidence as it settles the issue
over regulation.
The ruling is a relief to existing policy holders who were unsure of continuing with the product
and new investors were wary of buying them.
Ulips are hybrid products incorporating investment and insurance cover. They account for more
than 85% of the portfolio for life insurers. Insurers can now sell new Ulips launched after April
9, 2010.
The government will amend the RBI Act, the Insurance Act, the Sebi Act and the Securities
Contract Regulation Act to include Ulips, scripts or any such insttruments under the life
insurance business. The Bill will be introduced in the monsoon session of Parliament, said a
senior finance ministry official.
Over the last few weeks, the Irda has tightened the norms for Ulips to raise the risk cover they
offer and blunt Sebi’s criticism that Ulips are colective investment schemes as the risk cover is
limited to 2% of the premium. It has also made it mandatory for insurers to offer a life cover with
pension plans. The regulator has set July 1 as the deadline for implementing the new Ulip
guidelines.
The Irda had already started addressing some of the issues over which there were concerns from
some quarters.Now with this ordinance the dispute itself has been resolved. In fiscal year 2009-
10, Ulips accounted for more than four-fifths of the total insurance premium of around Rs 2.60
lakh crore that was collected.
ULIPs all set to offer guaranteed returns; IRDA to raise risk cover
India’s insurance regulator—the Insurance Regulatory and Development Authority (Irda)—
boosted by a clear mandate from the government to regulate unit-linked insurance plans (Ulips),
will unveil new rules soon to raise the risk cover and to lower charges to make this product more
attractive to investors.
In what could potentially be a game changer, Ulips are set to offer guaranteed maturity benefits
to protect policyholders even when markets crash, said a senior official in the regulator’s office.
The aim is to encourage long-term savings and help policyholders build a nest egg to cater to
their needs as they grow old. Insurers now offer guaranteed returns only on pension policies that
are not sold on a unit-linked platform.
“We will revise the guidelines for Ulips to make it attractive for investors. Insurers will also be
given more time to redesign these products,” Irda chairman J Hari Narayan told ET. Over the
weekend, the government promulgated an ordinance to bring Ulips under the regulatory purview
of Irda.
Pension plans will now have to be bundled with a life cover or a health cover or annuities.
Insurers can offer all three, but at least one will be mandatory. Irda is also planning to prescribe
the minimum health cover for policyholders.
For pension plans, the insurer has to convert the accumulated fund value into an annuity at
maturity. The policyholder or the insured will have the option to commute up to a maximum of
one-third of the accumulated value as lump sum on maturity. If the policy is surrendered, the
policyholder will get only a third of the surrender value. Further, the policy older will have to
buy an annuity for the remaining amount.
Regulator plans curbs on direct marketing of Ulips
Ulips will have a minimum lock-in period of five years compared to three years now. Partial
withdrawals will be allowed only at the start of the fifth year. Group products will continue to be
on annually renewable basis. All top-up premiums paid during the tenure of the contract should
have an insurance cover and will be treated as single premium.
The cap on charges will be revised to ensure that a policyholder gets a decent return even if he
discontinues paying the premium mid-term.
Policyholders now lose out if they stop paying their premium when charges are front-ended
while the benefits are back-ended. Irda proposes a fair deal to those who pull out their
investments in Ulips by introducing a ceiling on the difference between gross yields (returns had
there been no charges) and net yields (returns after factoring in charges) from the sixth year
onwards.
The charges will be close to 2.5-3.3% in the sixth year, which drops to 3% by the 10th year.
Surrender charges will be capped at 20% for premiums ranging between Rs 15,000 and Rs
20,000.
“There will be a fundamental change in the way unit-linked insurance plans are sold. The
changes proposed by the regulator will bring about a qualitative change in the way Ulips are
positioned and sold. They will offer a much better value proposition for the policyholder,” said
Rajiv Jamkhedkar, managing director, Aegon Religare Life Insurance.
Insurers said they will now be forced to spread commissions over the initial years and position
Ulips as long-term products. “There cannot be any high charge on products now,” he said.
Mutual funds, which do not charge any entry loads, mounted a scathing attack on insurance
companies for charging hefty commissions of up to 40% on Ulips to drive sales of the product.
The other major criticism was on the paltry life cover on Ulips.
The regulator has also proposed curbs on direct marketing either through telephone or DTH
television whereby marketers would have to obtain the consent of the prospect before proceeding
with their marketing pitch. Telecallers will also have to follow a fixed script and insurance
companies will need to maintain recordings of conversations with prospects.
IRDA to make ULIPs investor-friendly
NEW DELHI: Insurance regulator IRDA, which has won its turf war with market watchdog
SEBI over regulation of ULIPs, is expected to tighten norms for these schemes, including
commission charges, to make them attractive for investors.
There would be stricter and stringent distribution norms, leading to lowering of commissions on
the sale of such products, sources said.
Currently, commission charges are as high as 50 per cent of the first-year premium.
According to IRDA Chairman J Hari Narayan, it will frame new guidelines for these products to
make them more attractive for policy holders.
At the same time, the regulator plans to come out with directives to improve the transparency
element of such hybrid products, which involve both investment and insurance.
The regulator will also try and address the issue of increasing the lock-in-period and raising life
cover.
These products need to be more transparent and whatever commission and expenses are built
into the product should be disclosed explicitly in a simplified format, sources said.
Indicating that IRDA would continue with its reforms of ULIPs, Finance Minister Pranab
Mukherjee had said, "I understand that Insurance Regulatory and Development Authority has
taken some very positive steps in respect of regulations of ULIPs, which are in the interest of
both the insurance industry as also the policyholders."
"I am sure that the insurance industry and IRDA would continue to bring in these reforms so that
the interest of all the stakeholders are secured," he said earlier this month.
IRDA has already taken some measures like imposing a cap on ULIP charges, extending the
minimum term of the policy to five years, introducing the concept of compulsory annuitisation in
pension policies and fixing the maximum limit of surrender charges.
In order to put more money in the hands of investors, IRDA recently said that insurers cannot
charge a fee for surrendering a unit-linked insurance policy after five years.
Insurance companies used to charge a nominal fee for customers to withdraw their unit-linked
policies even after expiry of the lock-in period.
However, policies withdrawn during the lock-in compulsorily attract a high surrender charge.

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Edelweiss Asset Management Limited, a subsidiary of Edelweiss Capital Limited (ECL) is the

To be an innovative and universally renowned asset manager providing excellent investment

• Providing high quality investment management services to a wide spectrum of investors.

• Thinking and transparent organization

Stocks represent shares of ownership in a public company. Examples of public companies

Working of Mutual Fund

What is a Mutual Fund?

Types of Mutual Funds Schemes in India

Overview of existing schemes existed in mutual fund category: BY STRUCTURE

1. Open - Ended Schemes:

2. Close - Ended Schemes:

Overview of existing schemes existed in mutual fund category: BY NATURE

• Diversified Equity Funds

• Tax Saving Schemes:

• Sector Specific Schemes:

Pros & cons of investing in mutual funds:

Advantages of Investing Mutual Funds:

2. Diversification - Purchasing units in a mutual fund instead of buying individual stocks or

5. Simplicity - Investments in mutual fund is considered to be easy, compare to other available

Disadvantages of Investing Mutual Funds:

Name: Edelweiss Absolute Return Equity Fund

Scheme Type: An Open Ended Equity Scheme

Benchmark Index : CRISIL MIP Blended Index

Fund Manager : Mr. Paul Parampreet

Application Amount / No. of Units:

Purchases Additional Purchase Redemption

Entry Load: NIL

Exit Load: Under Normal Circumstances Upto 30 days - 1%

Above 30 days - NIL

Above 30 days – NIL

Expenses of the scheme:

Asset Allocation Pattern

Under normal circumstances, the anticipated asset allocation would be:

(a) Cut off Timing for Subscriptions :

(b) Cut off Timing for Redemptions:

Asset Allocation Pattern

Under normal circumstances, the anticipated asset allocation would be:

Asset Class Allocation (% of Corpus) Risk Profile

Benchmark Index : S& P CNX Nifty

Fund Manager : Mr. Gaurav Khandelwal

Plans and Options:

Minimum Application amount for each Plan is stated below:

Plan A - Rs. 1,000/- and multiples of Re. 1

Plan B - Rs. 5,000/- and multiples of Re. 1

Plan C - Rs. 10,000/- and multiples of Re 1

Entry Load: NIL

Exit Load: Under Normal Circumstances Upto 30 days - 1%

Above 30 days - NIL

Under Expiry Day Trigger Facility Upto 30 days - 0.50%

(a) Cut off Timing for Subscriptions :

(b) Cut off Timing for Redemptions:

Benchmark Index : S& P CNX Nifty

Fund Manager : Mr. Paul Parampreet

Who should invest?

Default Plan: If the Investor fails to mention any Plan - Plan A.

Minimum Application amount for each Plan is stated below:

Plan A - Rs. 1,000/- and multiples of Re. 1

Plan B - Rs. 5,000/- and multiples of Re. 1

Plan C - Rs. 10,000/- and multiples of Re 1

Entry Load: NIL

Exit Load: Under Normal Circumstances Upto 30 days - 1%

Above 30 days - NIL

Under Expiry Day Trigger Facility Upto 30 days - 0.50%