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HDFC STANDARD LIFE INSURANCE COMPANY LIMITTED

IMPHAL MANIPUR 2009-2010

PROJECT REPORT
ON

UNIT LINKED POLICIES ARE THE KEY INSTRUMENT FOR GROWING THE FINANCIAL INVESTMENT OF THE POLICY HOLDERS W.R.T. HDFC STANDARD LIFE
UNDER THE KIND GUIDANCE AND SUPERVISION OF Mr. Luwangcha Surjeet Thounaojam (Sales Development Manager) HFDC Standard Life Insurance Company Limited, Khoyathong, Imphal

Submitted To: JIWAJI UNIVERSITY GWALIOR

Submitted By: NAOREM PREMLATA DEVI BBA (5th Sem, Finance) Vijayaraje Institute of Science & Management, Gwalior

Students Declaration:
I, Naorem Premlata Devi, student of BBA 5th Semester of Vijayaraje Institute of Science & Management (VISM), hereby declared that the Project Report Title Unit Linked Policies Plan are the key instrument for growing the financial investment of the policy holders w.r.t. HDFC STANDARD LIFE submitted in partial fulfillment of the degree of Bachelor of Business Administration is my own work. I, further declare that all the facts and figures furnished in this project report are the outcome of my own observation and findings. They are first hand and original in nature. All the information gathered by me during the course of the training at HDFC STANDARD LIFE INSURANCE COMPANY LIMITED would be kept strictly Confident.

Naorem Premlata Devi

ACKNOWLEDGEMENT
It is nice to express gratitude and appreciation to everyone who is involved making this project possible. I dont have words to thank them all individually from the bottom of my heart. I wish to express my deep appreciation to Luwangcha Surjeet Thounaojam (Sales Development Manager) for providing an opportunity to work as a trainee in the company and providing the necessary guidance, encouragement, support and valuable suggestions which has been a key to success in this project. I wish to do project again in future under his guidance. At the last I would like to express my gratitude to the person who have offered their valuable guidance in completing this project.

Naorem Premlata Devi

PREFACE
I have great pleasure in doing this project on Unit Linked Policies are the key instrument for growing the financial investment of the policy holders w.r.t. HDFC STANDARD LIFE followed in HDFC STANDARD LIFE, Imphal. Need for this project arises because vocational training with project report is a part of my syllabus. Another reason is that training is one of the important aspects for a BBA student career. My project title is Unit Linked Policies are the key instrument for growing the financial investment of the policy holders w.r.t. HDFC STANDARD LIFE reason for choosing this particular topic is to find out the benefits provided by insurance company to their customers. As a BBA student, it is necessary to know deeply about customers benefit upon the unit linked policies offered by insurance companies. I have completed this report with my best effort and I hope this report will give complete satisfaction regarding relationship between the customers and insurance companies.

Naorem Premlata Devi

INDEX
Contents 1. Objective of the study 2. HDFC Standard Life Insurance Company Limited Introduction. 3. Unit Linked Insurance Plans. 4. Children Plans. 5. Retirement Plans. 6. Saving and investment Plans. 7. HDFC Standard Life Imphal. 8. Conclusion. 9. Recommendation and Suggestion. 10. Bibliography. Page No. 6 7 14 17 22 26 34 35 36 38

Objective of the Study:


1. Unit Linked Policies are the key instrument for growing the financial investment of the policy holders. 2. Understanding the level of awareness on insurance, options based on needs and wants of the life assured along with the financial growth for loyal Customers of the company. 3. To find out the number of unit linked policies offer to customers by HDFC Standard Life. 4. To find out the customers benefit upon the Unit Linked Policies. 5. Analysis of Market based policies (Unit Linked) offered by HDFC and other Insurance Companies.

HDFC STANDARD LIFE INSURANCE COMPANY LIMITED INTRODUCTION:


HDFC Standard Life Insurance Company Limited is one of India's leading private insurance companies, which offers a range of individual and group insurance solutions. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Limited), India's leading housing finance institution and a Group Company of the Standard Life Plc, UK. As on February 28, 2009 HDFC Ltd. holds 72.43% and Standard Life (Mauritius Holding) 2006, Ltd. holds 26.00% of equity in the joint venture, while the rest is held by others.

HDFC Key Strengths


Financial Expertise
As a joint venture of leading financial services groups, HDFC Standard Life has the financial expertise required to manage our long-term investments safely and efficiently.

Range of Solutions
They have a range of individual and group solutions, which can be easily customized to specific needs. There group solutions have been designed to offer us complete flexibility combined with a low charging structure. There gross premium income, for the year ending March 31, 2009 stood at Rs.5,564.69 crores. As on March 31, 2009, the company has more than 27lakh polices in force.

Why we need HDFC Standard Life?


HDFC Standard Life believes that establishing a strong and ethical foundation is an essential prerequisite for long-term sustainable growth. To ensure this, we have concentrated our focus on expansion of branch network, organizing an efficient and well trained sales force, and setting up appropriate systems and processes with optimum use of technology. As all these areas form the basic infrastructure for establishing the highest possible customer service standards. Our core values are drilled down to all levels of employees, as these are inviolable. We continue to promote high integrity in business practices and shun short cuts and unethical practices, as we wish to be perceived as an institution with high moral standing. Since their inception in 2000, when the Indian insurance space was opened for private participation, they have consistently focused on setting benchmarks in all aspect on insurance business. Being the first private player to be registered with the IRDA and the first to issue a policy on December 12, 2000, their differentiators are: 1. Strong Promoter: HDFC Standard Life is a strong, financially secure business supported by two strong and secure promoters HDFC Ltd and Standard Life. HDFC Ltds excellent brand strength emerges from its unrelenting focus on corporate governance, high standards of ethics and clarity of vision. Standard Life is a 7

strong, financially secure business and a market leader in the UK Life & Pensions sector.

2. Preferred and Trusted Brand:


There brand has managed to set a new standard in the Indian life insurance communication space. They were the first private life insurer to break the ice using the idea of self-respect instead of death to convey their brand proposition (Sar Utha Ke Jiyo). Today, they are one of the few brands that customers recognize, like and prefer to do business. Moreover, our brand thought, Sar Utha Ke Jiyo, is the most recalled campaign in its category.

3. Investment policy:
They follow a conservative investment management philosophy to ensure that their customers money is looked after well. The investment policies and actions are regularly monitored by a formal Investment Committee comprising non-executive directors and the Principal Officer & Executive Director. As a life insurance company, we understand that customers have invested their savings with them for the long term, with specific objectives in mind. Thus, their investment focus is based on the primary objective of protecting and generating good, consistent, and stable investment returns to match the investors long-term objective and return expectations, irrespective of the market condition.

4. Need-Based selling Approach:


Despite the criticality of life insurance, sales in the industry have been characterized by over reliance on tax benefits and limited advice-based selling. Their eight-step structured sales process Disha however, helps customers understand their latent needs at the first instance itself without focusing on product features or tax benefits. Need-based selling process, 'Disha', the first of its kinds in the industry, looks at the whole financial picture. Customers see a plan not piecemeal product selling.

5. Risk Control Framework:


HDFC Standard Life has fully implemented a risk control framework to ensure that all types of risks (not just financial) are identified and measured. These are regularly reported to the board and this ensures that the company management and board members are fully aware of any risks and the actions taken to ensure they are mitigated.

6. Focus on Training:
Training is an integral part of their business strategy. Almost all employees have undergone training to enhance their technical skills or the softer behavioral skills to be able to deliver the service standards that their company has set for itself. Besides the mandatory training that Financial Consultants have to undergo prior to being licensed, they have developed and implemented various training modules covering various aspects including product knowledge, selling skills, objection handling skills and so on. 8

7. Focus on Long Term training:


HDFC Standard Life does not focus in the business of ramping up the top line only, but to create maximization of stakeholder's value. Today, they are extremely satisfied with the base that they have created for the long-term success of this company.

8. Transparent Dealing:
They are one of the few companies whose product details, pricing; clauses are clearly communicated to help customers take the right decision.

9. Strict Compliance with Regulation:


They have initiated and implemented many new processes, some of which were found useful by the IRDA and later made mandatory for the entire industry. The agents who successfully completed this training only, were authorized by the company to sell ULIPs. This has now been made compulsory by IRDA for all insurance companies under the new Unit Linked Guidelines. 10. Diversified Product Portfolio: HDFC Standard Lifes wide and diversified product portfolio help individuals meet their various needs, be it: Protection: Need for a sound income protection in case of our unfortunate demise Investment: Need to ensure long-term real growth of our money Savings: Save for the milestones and protect our savings too. Pension: Need to save for a comfortable life post retirement Health: Cover for health related exigencies.

Their Parentage:
HDFC Limited: HDFC Limited, Indias premier housing finance institution has assisted more than 3.3 million families own a home, since its inception in 1977 across 2400 cities and towns through its network of over 250 offices. It has international offices in Dubai, London and Singapore with service associates in Saudi Arabia, Qatar, Kuwait and Oman to assist NRIs and PIOs to own a home back in India. As of December 2008, the total asset size has crossed more than Rs. 95,000 crores including the mortgage loan assets of more than Rs. 82,800 crores. The corporation has a deposit base of Rs. 17,551 crores, earning the trust of more than 9,00,000 depositors. Customer Service and satisfaction has been the mainstay of the organization. HDFC has set benchmarks for the Indian housing finance industry. Recognition for the service to the sector has come from several national and international entities including the World Bank that has lauded HDFC as a model housing finance company for the developing countries. HDFC has undertaken a lot of consultancies abroad assisting different countries including Egypt, Maldives, and Bangladesh in the setting up of housing finance companies. 9

Standard Life Group (Standard Life plc and its subsidiaries):


The Standard Life Group has been looking after the financial needs of customers for over 180 years. It currently has a customer base of around 7 million people who rely on the company for their insurance, pension, investment, banking and health-care needs. Its investment manager currently administers 125 billion in assets. It is a leading pensions provider in the UK, and is rated by Standard & Poor's as 'strong' with a rating of A+ and as 'good' with a rating of A1 by Moody's. Standard Life was awarded the 'Best Pension Provider' in 2004, 2005 and 2006 at the Money Marketing Awards, and it was voted a 5 star life and pensions provider at the Financial Adviser Service Awards for the last 10 years running. The '5 Star' accolade has also been awarded to Standard Life Investments for the last 10 years, and to Standard Life Bank since its inception in 1998. Standard Life Bank was awarded the 'Best Flexible Mortgage Lender' at the Mortgage Magazine Awards in 2006.

HDFC visions and values:


'The most successful and admired life insurance company, which means that they are the most trusted company, the easiest to deal with, offer the best value for money, and set the standards in the industry'. 'The most obvious choice for all'. There Values: Values that we observe while we work: Integrity Innovation Customer centric People Care One for all and all for one Team work Joy and Simplicity Associated Companies:

HDFC Limited

HDFC Bank

HDFC Mutual Fund

HDFC Sales

HDFC ERGO General insurance 10

FUND DETAILS: Introduction:

This section will be useful for all the customers who have unit linked policies. It will help us understand how their unit-linked funds have performed vis-a vis industry benchmarks. It will also give us details of their investment philosophy covering aspects such as the investment process and risk management. For better understanding of the performance of unit linked policies, we may have a look at the Guide to Rolling performance help file. How the funds perform depend on where they have invested our premiums. The portfolio disclosure section will tell us just that! The market watch section guides us through the current market scenario to understand market trends better.

Investment Philosophy:

As a life insurance company, we understand that customers have invested their savings with us for the long term, with specific objectives in mind like protection for the family in case of death of family member, child education and marriage liabilities or just investment returns over a longer period of time. With the above in mind, our investment focus is based on the primary objective of protecting and generating good and consistent investment returns to match the investors long term objective and return expectations. Our investment success is therefore based on teamwork guided by a robust and repeatable investment process. You can click on the following links to get a better understanding of HDFC Standard Life Investment approach. * Investment process * Risk Management 11

Market Watch:

Market Outlook & Strategy October 2009:


Equity markets Indices BSE Sensex S&P CNX Nifty BSE 100 BSE Mid Cap BSE Small Cap Debt markets 30th September 2009 10-yr G Sec yield (%) Inflation (%) Oil ($/barrel) INR/USD 7.15 0.83 70.61 48.11 31st August 2009 7.35 -0.21 69.97 48.88 30th September 2008 8.64 12.14 100.67 46.94 30th September 2009 17,127 5,084 8,930 6,324 7,590 31st August 2009 15,667 4,662 8,226 5,883 6,997 1 Month Return (%) 9.32 9.05 8.57 7.50 8.48 12 Month Return(%) 33.17 29.65 33.46 31.80 36.08

Fund Performance:

This section illustrates our unit-linked fund performance. We believe that all policyholders will find this information useful. The long-term worth of any Unit Linked policy comes from: 12

The investment returns it gives over time The effect of the charges over the lifetime of the policy The benefit illustrations we provide to all our customers at the point of sale comply with IRDA guidelines and show the effect of the charges. This investment return data allows you to see how, in general, our funds are performing. We have provided our performance figures in the following way: Rolling Performance: This is a chart analysis showing you year-on-year performance of our funds against a comparable market index Fund Meter: This is a bar chart representing returns achieved over certain pre-defined periods of time For better understanding of the Rolling Performance charts, you may have a look at the Guide to Rolling performance help file.

Unit Linked Insurance plans: Introduction:


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In Unit Linked Plans, the investments made are subject to risks associated with the capital markets. This investment risk in investment portfolio is borne by the policy holder. Thus, we should make our investment choice after considering our risk appetite and needs. Another factor that we need to consider is our future need for funds. HDFC Standard Life offers us a variety of unit-linked insurance products to suit our goals be it for our retirement planning, for our health, for our childs education and marriage or for investment purposes.

Which Investor Class Are They Most Suited For?


1. Those who wish to closely track their investments: Unit linked plans allow policy takers to closely monitor their portfolios. They also offer the flexibility to switch our capital between funds with varying risk-return profiles. 2. Individuals with a medium to long term investment horizon: Unit linked plans are ideal for individuals who are ready to stay invested for relatively long periods of time. 3. Those with varying risk profiles: Across the seven funds offered, the equity component varies from zero to a maximum of 100 per cent. Thus there is a choice of funds available to all types of investors - from risk-averse investor to those investors who have strong risk appetite. 4. Investors across all life stages: This plan category offers a variety of plans which can be opted for depending upon the life stage we are in and our needs and financial liabilities at that point in time.

How is it constructed?
In a Unit Linked Plan, the premiums we pay are invested in the funds chosen by us after deducting allocation charges and charges including those for managing funds, policy administration and for providing insurance cover are deducted from the funds by cancelling certain units. The value of each unit of a fund is determined by dividing the total value of the funds investments by the total number of units.

Advantages of a Unit Linked Plan:


a). Market linked returns: Unit linked plans give us an opportunity to earn market-linked returns as part of the premiums are invested in market linked funds which invest in different market instruments including debt instruments and equity in varying proportions. b). Life protection, Investment and Savings: Unit linked plans offer the twin benefits of life insurance and savings at market-linked returns. Thus, we have the opportunity to invest our money to earn higher returns, while taking care of our protection needs. Investing in unit linked plans helps to inculcate a regular habit of saving and investing, which is important for building wealth over the long term. c). Flexibility: Unit Linked Plans offer us a wide range of flexible options such as 1. The option to switch between investment funds to match our changing needs. 2. The facility to partially withdraw from our fund, subject to charges and conditions. 14

3. Single premium additions to enable the policy holder to invest additional sums of money (over and above the regular premium) as and when desired, subject to conditions.

Servicing a Unit Linked Plan:


1. Single Premium: The policy holder is required to pay the entire premium amount as a lump sum at the beginning of the policy term. 2. Regular Premium Payment (annually, semi-annually or monthly): The policy holder has to pay the pre-determined premium amount periodically i.e. annually, semi annually or monthly, depending upon the premium payment term opted for. 3. Number of Premium Paying Years: This depends on the term of the policy that we have chosen. In most cases, the policy term and the number of premium paying years (in case of regular premiums) are the same. However, some policies give the insured the option of choosing the number of premium paying years.

Charges:
The following charges are deducted from our policy towards the cost of benefits and administration services provided by HDFC Standard Life Insurance 1. Administration charges: A fee is charged for administration of our policy every month. Administration charges are deducted by cancelling units proportionately from each of the funds we have chosen. 2. Fund management charges: These charges are towards meeting expenses related to managing the fund. This is charged as a percentage of the funds value and is deducted before arriving at the net asset value of the fund. 3. Switch charges: we can switch between the funds available to suit our changing needs and goals. In a policy year, a fixed number of such switches are available free of cost. Subsequent to this, each switch would attract a certain charge. These charges are deducted by cancelling units proportionately from each of the funds we have chosen. 4. Surrender charges: These charges are levied for premature encashment of units. They are charged as a percentage of the fund value and depend on the policy year in which the policy has been surrendered. 5. Mortality Charges: Depending upon the age, and the amount of cover, these charges are levied towards providing a death cover to the insured. 6. Premium Allocation Charge: This charge is deducted as a fixed percentage of the premium received, and is usually charged at a higher rate in the initial years of a policy. This charge varies depending upon whether the policy is a single premium or regular premium policy, the size of the premium, premium frequency and payment mode. 7. Partial Withdrawal Charges: Lump sum withdrawals are allowed from the fund after the lapse of three years of the policy term and subject to pre-specified conditions. However, such withdrawals attract charges, as mentioned in the respective policy brochures.

Switching Between Funds


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HDFC Standard Life Insurance offers us the flexibility to switch between funds available under a unit linked plan. We may wish to switch between equity and debt funds, in times when there is market volatility or interest rate fluctuations. At times, changes in our financial standing, liabilities or risk profile may also require that we change our investments accordingly.

Making Withdrawals
We may also make partial withdrawals from our funds after a certain specified period, subject to a partial withdrawal charge. The withdrawal amount should be at least the minimum prescribed withdrawal amount and the fund must not fall below the minimum fund value after the withdrawal. We can make a full withdrawal of our policy before its maturity date. However, surrender charges will be applicable in this case.

Unit Linked Insurance Plans:


1. Unit Linked Endowment plans 2. Unit Linked endowment plus-II Plan 3. Unit Linked Young star plus-II plan 4. Unit Linked enhanced life protection-II plan 5. Unit Linked pension plan-II 6. Unit Linked Wealth Maximizer plus-II 7. Unit Linked Wealth multiplier 8. Simply Life

CHILDRENS PLANS:
Childrens Plans helps us save so that we can fulfill our childs dreams and aspirations. These plans go a long way in securing our childs future by financing the key 16

milestones in their lives even if we are no longer around to oversee them. As a parent, we wish to provide our child with the very best that life offers, the best possible education, marriage and life style. Most of these goals have a price tag attached and unless we plan our finances carefully, we may not be able to provide the required economic support to our child when we need it the most. For example, with the high and rising costs of education, if we are not financially prepared, our child may miss an opportunity of a lifetime. Today, a 2-year MBA course at a premiere management institute would cost us nearly Rs. 3,00,000/- At a assumed 6% rate of inflation per annum, 20 years later, we would need almost Rs. 9,07,680/- to finance our child's MBA degree. An illustration of how education expenses could rise with passing time due to inflation:

So, how can we cope with these costs? Childrens Plans help us save steadily over the long term so that we can secure our childs future needs, be it higher education, marriage or anything else. A small sum invested by us regularly can help us build a decent corpus over a period of time and go a long way in providing our child a secured financial future along with.

Types of Childrens Plan:


There range of Childrens Plans includes 17

1. HDFC Unit Linked Young Star II: As a parent, our priority is our childs future and being able to meet our childs dreams and aspirations. With our HDFC Unit Linked Young Star II, we can start building our savings today and ensure a bright future for our child. This plan provides valuable protection to our child in case we are not around. This Unit Linked Plan also gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments.

Features:

Advantages:
a). We can customize the ideal plan for our child by choosing the premium you wish to invest along with the Sum Assured, depending on the level of protection required b). The Triple Benefit payment preference helps us secure your childs immediate and future needs. In case of our unfortunate demise or critical illness, they will pay the Sum Assured to our child (Beneficiary). Our family need not pay any further premiums. They will pay 50% of all the future premiums at the original level towards our policy and 50% of the premiums will be paid to the Beneficiary as and when due, on an annual basis. Any Death Benefit or Critical Illness cover terminates immediately c). In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). They have a low FMC of only 1.25% per annum (of the funds value) d). we can choose to pay our premium as either Annually, Half-Yearly or Monthly depending on our convenience. We also have a range of convenient auto premium payment options 18

e). we can change our investment fund choices in two ways: * Switching: We can move our accumulated funds from one fund to another anytime * Premium Redirection: We can pay our future premiums into a different selection of funds, as per our need. f). Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961.

2. HDFC Unit Linked Young Star Plus II:


As a parent, our priority is your childs future and being able to meet our childs dreams and aspirations. With our HDFC Unit Linked Young Star II, we can start building our savings today and ensure a bright future for our child. This Unit Linked Plan provides valuable protection to our child in case we are not around and gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments. This plan also gives regular Loyalty Units to boost our fund value each year.

Features:

Advantages:
a). This plan gives us regular Loyalty Units to boost our fund value every year. At the end of every policy year, they will increase the number of units (Loyalty Units) in each of our funds by 0.10% as long as our policy is in force (premium paying or paid up). The compounding effect of these regular additions is expected to boost our final maturity value. b).We can customize the ideal plan for our child by choosing the premium we wish to invest along with the Sum Assured, depending on the level of protection required. c).The Triple Benefit payment preference helps us secure our childs immediate and future needs. In case of our unfortunate demise or critical illness, they will pay the Sum Assured to our child (Beneficiary). Our family need not pay any further premiums. They will pay 50% of all the future premiums at the original level towards our policy and 50% of the premiums will be paid to the Beneficiary as and when due, on an annual basis. Any Death Benefit or Critical Illness cover terminates immediately 19

d). In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). We have a low FMC of only 1.25% per annum (of the funds value) e). We can choose to pay our premium as either Annually, Half-Yearly or Monthly depending on your convenience. We also have a range of convenient auto premium payment options f). We can change our investment fund choices in two ways: * Switching: we can move our accumulated funds from one fund to another anytime * Premium Redirection: We can pay our future premiums into a different selection of funds, as per our need g). Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961.

3. HDFC Unit Linked Young Star Champion:


As a parent, our priority is our childs future and being able to meet our childs dreams and aspirations. With their HDFC Unit Linked Young Champion, we can start building our savings today and ensure a bright future for our child. It is a convenient plan, which saves us from the need of going for Medicals. This Unit Linked Plan provides valuable protection to our child in case we are not around and gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at Maturity.

Features:

Advantages:
a) No need to go for medicals. Just filling a Short Medical Questionnaire will do 20

b) This plan gives us Bumper Addition to the fund value at Maturity. Our fund value will be augmented by addition of Bumper Addition, which is a percentage of our original annualized premium. c) The Triple Insurance Benefit helps us secure our childs immediate and future needs. In case of our unfortunate demise within the policy term, they will pay the Sum Assured to our child (Beneficiary). Our family need not pay any further premiums. They will pay 50% of the original regular premiums towards our policy. On maturity our child will receive the fund value plus the Bumper Additions (if eligible). d) In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). They have a low FMC of only 1.25% per annum (of the funds value). e) We can choose to pay our premium as either Monthly (through Standing Instructions or ECS Mandate) or annually. We also have a range of convenient auto premium payment options. f) We can change our investment fund choices in two ways: * Switching: we can move our accumulated funds from one fund to another anytime. * Premium Redirection: we can pay our future premiums into a different selection of funds, as per our need. g) Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961

RETIREMENT PLANS:
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These are the types of Retirement Plans. It provides us with financial security so that when our professional income starts to ebb, we can still live with pride without compromising on our living standards. By providing us a tool to accumulate and invest our savings, these plans give us a lump sum on retirement, which is then used to get regular income through an annuity plan. Given the high cost of living and rising inflation, employer pensions alone are not sufficient. Pension planning has therefore become critical today. Indias average life expectancy is slated to increase to over 75 years by 2050 from the present level of close to 65 years. Life spans have been increasing due to better health and sanitation conditions in the country. However, the average number of years of employment has not been rising commensurately. The result is an increase in the number of post-retirement years. Accordingly, it has become necessary to ensure regular income for life after retirement, so that we can live with pride and enjoy our twilight years.

Priorities at different stages of life:-

However, skyrocketing costs can throw even a well-laid plan off balance. With costs rising every day, we can just imagine how high they will be when we are ready to hang up our boots. So, what should we do to counter this? Its time to plan our retirement and that too sooner than later. However, skyrocketing costs can throw even a well-laid plan off balance. With costs rising every day, we can just imagine how high they will be when we are ready to hang up our boots. So, what should we do to counter this? Its time to plan our retirement and that too sooner than later.

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The above illustration shows how with each passing year our annual savings requirement would increase. For instance, if we are 30 years old and plan to retire at 60, then, with a current annual expenditure of Rs. 3,00,000/- ,we would need a corpus in excess of Rs. 2,00,00,000/- to maintain our living standards, assuming we live till 85 years and the inflation rate is 4%. To build this retirement corpus, we need to invest Rs 3,60,000/- per annum in a retirement plan that offers 8% returns per annum. In case we delay planning our retirement by 5 years then the investment amount would increase to Rs 6,90,000/- per annum.

Types of Retirement Plans:


There range of Retirement Plans includes

1. HDFC Unit Linked Pension II:


Today, we are busy climbing the ladder of success and realizing our dreams. Today, time is with us. Just take a moment and think. Will our income be the same forever? Will we be able to live life on our own terms even after we retire? The HDFC Unit Linked Pension II is Unit Linked plan, designed to provide a post-retirement income for life with the freedom to choose our retirement date. This plan gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments. This plan also gives Bumper Addition to the fund value at vesting.

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Features:

Advantages:
A). This plan is designed to provide us a post retirement income for life We can choose our premium, the Sum Assured and our retirement date. At the end of the policy term, we will receive the accumulated value of our funds, which will be used to provide our pension income in our golden years. B). This plan gives us Bumper Addition to the fund value on Vesting. Our fund value will be augmented by addition of Bumper Addition to the extent of 50% of our original annualized premium chosen at inception. C). On our chosen retirement (Vesting) date, we will get the value of the units in our policy. As per prevailing Government regulations; * We can take up to 1/3rd of the total benefit at Vesting (fund value + Bumper Addition) as a tax-free cash lump sum * The rest must be converted to annuity * You can buy the annuity from us or any other insurer D). In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). They have a low FMC of only 1.25% per annum (of the funds value) E). If we have not opted for AAO (Asset Allocation Option), we can change our investment fund choices in two ways: * Switching: We can move our accumulated funds from one fund to another anytime. * Premium Redirection: We can pay our future premiums into a different selection of funds, as per our need. F). We can choose to pay our premium as either Monthly (through Standing Instructions or ECS Mandate), Half yearly or annually. We also have a range of convenient auto premium payment options G). Tax benefits under sections 80CCC of the Income Tax Act, 1961 subject to the provisions contained therein 24

2. HDFC Unit Linked Pension Maximiser II:


Ideally, just how spending comes to us, so must saving and investing. We are able to finance our expenses and take care of our expenses in present times. However, to ensure that we are able to maintain the same standard of living post retirement, we need to make the right kind of investment today. HDFC Unit Linked Pension Maximiser II is a unique Single Premium unit linked plan, designed to provide a post-retirement income for life with the freedom to maximize our investment returns. This plan also gives Bumper Addition of 10% of initial single premium at vesting and on death.

Features:

Advantages:
A). This plan is designed to provide us a post retirement income for life We can choose our initial single premium, the investment strategy and retirement date. At the end of the policy term, we will receive the accumulated value of our funds including Bumper Additions, which will be used to provide our pension income in our golden years. B). This plan gives us Bumper Addition (for policies with term equal or greater than 15 years) to the fund value on Vesting. Our fund value will be augmented by addition of Bumper Addition to the extent of 10% of the initial single premium chosen at inception. C). On our chosen retirement (Vesting) date, we will get the value of the units in our policy. As per prevailing Government regulations; * We can take up to 1/3rd of the total benefit at Vesting (fund value + Bumper Addition if any) as a tax-free cash lump sum. * The rest must be converted to annuity. * You can buy the annuity from us or any other insurer. D). In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). We have a low FMC of only 1.25% per annum (of the funds value). E). We can change our investment fund choices through switching where we can move our accumulated funds from one fund to another anytime. F). Tax benefits under sections 80CCC of the Income Tax Act, 1961 subject to the provisions contained therein. 25

SAVING AND INVESTMENT PLANS:


We have always given our family the very best. And there is no reason why they shouldnt get the very best in the future too. As a judicious family man, our priority is to secure the well-being of those who depend on us. Not just for today, but also in the long term. More importantly, we have to ensure that our familys future expenses are taken care, even if something unfortunate were to happen to us. A big factor that we need to consider while building our wealth is inflation. It has a dual impact on our hard-earned savings. Inflation not only erodes our current purchasing power but also magnifies our monetary requirements for the future. Sample this: An 35 Year individual needs to invest Rs. 36,000/- per year with 8% returns to build a corpus of Rs. 10,00,000/- by the age of 50 Years.

However, Rs. 10,00,000/- after 15 years would be worth roughly around half of what it is today once adjusted for inflation at the rate of 4%. Therefore, an individual will need to save nearer to Rs. 50,000/- annually to reach our targeted savings at the age of 50 Years, if we consider inflation. There Savings & Investment Plans provide us the assurance of lump sum funds for us and our familys future expenses. While providing an excellent savings tool for our short term and long term financial goals, these plans also assure our family a certain sum by way of an insurance cover. With HDFC Standard Lifes range of Saving & Investment Plans, we can therefore ensure that our family always remains financially independent, even if we are not around.

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Types of Saving and Investment Plans:

1. HDFC Unit Linked Endowment Plus II:


As a judicious family man, our priority is to secure the well-being of those who depend on us. Not just for today, but also for the long term. With there HDFC Unit Linked Endowment Plus II, we can start building our savings today and ensure that our family remains financially independent, even when we are not around. This Unit Linked plan provides valuable protection to our family in case we are not around and gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments. This plan also gives regular Loyalty Units to boost our fund value each year.

Features:

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Advantages:
A). This plan gives us regular Loyalty Units to boost our fund value every year. At the end of every policy year, we will increase the number of units (Loyalty Units) in each of our funds by 0.10% as long as our policy is in force (premium paying or paid up). The compounding effect of these regular additions is expected to boost our final maturity value B). This plan provides valuable protection to our family in case us are not around. In case of our unfortunate demise during the policy term, they will pay the greater of our Sum Assured (less any withdrawals we have made in the two years before our claim) and our total fund value to our family. C). We can choose any one of 4 Additional Plan Benefit options depending on our requirement: * Life Option = Death Benefit * Extra Life Option =Death Benefit + Accidental Death Benefit * Life & Health Option = Death Benefit + Critical Illness Benefit * Extra Life & Health Option = Death Benefit + Critical Illness Benefit + Accidental Death Benefit. D). We can choose to pay our premium as either Annually, Half-Yearly or Monthly depending on our convenience. We also have a range of convenient auto premium payment options. E). We can change our investment fund choices in two ways: * Switching: we can move our accumulated funds from one fund to another anytime * Premium Redirection: we can pay our future premiums into a different selection of funds, as per our need F). Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961. 2. HDFC Unit Linked Endowment II: We have always given our family the very best. And there is no reason why we should not get the best in future too. With rising costs, ensuring the best got our family will need some financial planning. With their HDFC Unit Linked Endowment II, we can start building our savings today and ensure that our family remains financially independent, even when we are not around. This Unit Linked Plan also gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments.

Features:

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Advantages:
1. This plan provides valuable protection to our family in case we are not around. In case of our unfortunate demise during the policy term, they will pay the greater of our Sum Assured (less any withdrawals we have made in the two years before our claim) and our total fund value to our family. 2. We can choose any one of 4 Additional Plan Benefit options depending on our requirement: Life Option = Death Benefit Extra Life Option = Death Benefit + Accidental Death Benefit Life & Health Option = Death Benefit + Critical Illness Benefit Extra Life & Health Option = Death Benefit + Critical Illness Benefit + Accidental Death Benefit 3. In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). They have a low FMC of only 1.25% per annum (of the funds value) 4. We can choose to pay our premium as either Annually, Half-Yearly or Monthly depending on our convenience. We also have a range of convenient auto premium payment options 5. We can change our investment fund choices in two ways: * Switching: we can move our accumulated funds from one fund to another anytime * Premium Redirection: we can pay our future premiums into a different selection of funds, as per our need 6. Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961

3. HDFC Unit Linked Enhanced Life Protection II:


We have always given our family the very best. And there is no reason why we should not get the best in future too. With their HDFC Unit Linked Enhanced Life Protection II, we can start building our savings today and ensure that our family remains financially 29

independent, even when we are not around. This Unit Linked Plan also gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments. In this plan, the original Sum Assured chosen by us will be automatically increased by 5% each year giving our family benefit of enhanced protection.

Features:

Advantages:

This plan provides valuable protection to our family in case we are not around. In case of our unfortunate demise during the policy term, they will pay the greater of our Sum Assured (less any withdrawals we have made in the two years before our claim) and our total fund value to our family. In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). They have a low FMC of only 1.25% per annum (of the funds value) We can choose to pay our premium as either Annually, Half-Yearly or Monthly depending on our convenience. We also have a range of convenient auto premium payment options We can change our investment fund choices in two ways:
o o

Switching: we can move our accumulated funds from one fund to another anytime Premium Redirection: we can pay our future premiums into a different selection of funds, as per our need

Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961

4. HDFC SimpliLife:
We have always believed in living life on our own terms. So why let the changing realities of everyday life overwhelm us and make our aspirations take a back seat? With 30

our HDFC SimpliLife Plan, we can plan now to maximize our savings and secure our and our familys future. It is a convenient plan, which saves us from the need of going for Medicals. This Unit Linked Plan gives us with an outstanding investment opportunity to maximize our savings by providing us a choice of thoroughly researched and selected investments.

Features:

Advantages:

This plan provides valuable protection to our family in case we are not around. In case of our unfortunate demise during the policy term, they will pay the Unit Fund Value plus Sum Assured to our family. In the long term, the key to building great maturity values is a low Fund Management Charge (FMC). They have a low FMC of only 1.25% per annum (of the funds value) We can choose to pay our premium as either Annually or Half-Yearly depending on our convenience. We also have a range of convenient auto premium payment options We can change our investment fund choices in two ways:
o o

Switching: We can move our accumulated funds from one fund to another anytime Premium Redirection: We can pay our future premiums into a different selection of funds, as per our need

Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961

5. HDFC Unit Linked Wealth Maximiser Plus:


Ideally, just how spending comes to us, so must saving and investing. We are able to finance our expenses and take care of our familys needs in present times. However, to ensure that family is able to maintain the same standard of living in the future, we need to make the right kind of investment today. HDFC Unit Linked Wealth Maximiser Plus, a unique Single Premium investment cum protection plan is a tailor made plan well suited 31

to meet our long-term investment needs and help us maintain our familys financial independence. This plan also gives regular Loyalty Units to boost our fund value each year.

Features:

Advantages:

This plan not only strives to maximise our investment return and providing longterm real growth for our money but also gives us an enhanced flexibility to suit our protection needs. This plan gives us regular Loyalty Units to boost our fund value every year. At the end of every policy year, they will increase the number of units (Loyalty Units) in each of our funds by 0.10% as long as our policy is not surrendered. The compounding effect of these regular additions is expected to boost our final proceeds. In case we opt for 1.1x Sum Assured, this plan is also available with limited underwriting wherein we will to fill a Short Medical Questionnaire (SMQ) They have a Fund Management Charge (FMC) of 1.75% per annum (of the funds value) We can change our investment fund choices through switching where we can move our accumulated funds from one fund to another anytime This is a single premium plan and subject to appropriate tax treatment under the Income Tax Act 1961. Currently Section 80C benefit is available for the premium paid into the plan subject to the limits in that section. Benefits received under Section 10(10D) will be exempt from tax subject to the limited contained therein

6. HDFC Unit Linked Wealth Multiplier:


Ideally, just how spending comes to us, so must saving and investing. We are able to finance our expenses and take care of our family's needs in present times. However, to 32

ensure that family maintains the same standard of living in the future, we need to make the right kind of investment today. HDFC Unit Linked Wealth Multiplier, a unique 3year premium payment Savings and Investment Plan is a tailor made plan well suited to meet our long-term investment needs and also help us maintain our familys financial independence.

Features:

Advantages:

This plan offers an excellent investment opportunity through choice of exclusive funds This plan has limited premium payment term of 3 years This plan also provides the facility of a single premium top - up They have a Fund Management Charge (FMC) of 1.75% per annum (of the fund's value) We can change your investment fund choices in two ways:
o o

Switching: we can move our accumulated funds from one fund to another anytime Premium Redirection: we can pay our future premiums into a different selection of funds, as per our need

we have a choice of paying our premium either half yearly or yearly Tax benefits are offered under section 80C and 10(10D) of the Income Tax Act, 1961

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HDFC STANDARD LIFE IMPHAL:


Manipur is situated in the north eastern part of India. The people living in Manipur are not all from the higher classes. Most of them belong to the middle class family i.e. salaried person. The economic condition of this state is also very poor and the per capita income is very low compared to other states in India. There is no business orientation. Manipur has slow financial growth. There is no stock market. There are some tools in order to prevent the financial inflation with personal interest. In order to get secure of the property or assets, most of the people are finding ways to invest their money. So in private level, HDFC standard Life insurance Company Limited is the leading insurance company in India. They provide best sell services to the customers. They perform best in the market place also. Most of the people invest their money in bank but nowadays most the people invest in insurance and it is also the best option for them.

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Conclusion:
At the end of our project we feel that we have gained a lot of acknowledgement about this unit and our project Unit Linked Policy Plan helps in growing the financial investment of the policy holder with preference to HDFC Standard life Insurance Company limited. In rotation work about its working routine and collected a lot of information about its policies. During this training, it was found that most of the people are aware that instead of investing their money in bank, most of the people invested their money in insurance policies. In the current situation they thought that it is the best option for them. So at last I am giving thanks to HDFC Imphal and all the members of this branch for providing me the knowledge of the advantages provided by unit linked policies to the policy holder.

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RECOMMENDATION AND SUGESSTION:


We recommended giving more opportunity to work as a trainee in the company as well as giving a chance for the company to grow. Some of my suggestions are as follows: 1. There should be modern furnished reception room. 2. There should be well decoration on the gate. 3. There should be proper uniform for every worker. 4. There should be pure drinking water facilities. 5. There should be good facilities for sitting. 6. There should be good receptionist to guide the visitors. 7. The road of the company should keep well.

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BIBLIOGRAPHY:
Website: www.hdfcinsurance.com Catalogue: Companys Catalogue.

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