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ANKIT BISSA
INDEX
S. No.
Particulars
Page No.
1.
1-3
2.
3.
4.
Company Products
6-26
5.
SWOT Analysis
27-28
INTRODUCTION TO COMPANY
Birla Sun Life Insurance Company Limited (BSLI) is a joint venture Between the
Aditya Birla Group and Sun Life Financial Inc., a leading International financial
services organization. The local knowledge of the Aditya Birla Group combined with
the expertise of Sun Life Financial Inc.,offers a formidable value proposition to
customers.
Sun Life Financial and its partners today have operations in key markets worldwide,
including India, Canada, the United States, the United Kingdom, Hong Kong,
Philippines, Japan, Indonesia, China and Bermuda. Sun Life Financial Inc. had assets
under management of over US$ 386.82 billion, as on 31 March 2007. Sun Life
Financial Inc. is a leading performer in the life insurance market in Canada.
BSLI in its five successful years of operations has contributed significantly to the
growth and development of the life insurance industry in India. It pioneered the
launch of Unit Linked Life Insurance plans amongst the private players in India. It
was the first player in the industry to sell its policies through the Bank assurance route
and through the internet. It was also the first private sector player to introduce a pure
term plan in the Indian market. This was supported by sales practices, which brought
a degree of transparency that was entirely new to the market. The process of getting
sales illustrations signed by customers, offering a free look period on all policies,
which are now industry standards were introduced by BSLI.
Being a customer centric company, BSLI has invested heavily in technology to build
world class processing capabilities. BSLI has covered more than one and a half
million lives since inception and its customer base is spread across 100 cities in India.
All this has assisted the company in cementing its place amongst the leaders in the
industry in terms of new business premium income.
Birla Sun Life Insurance (BSLI), one of the leading private life Insurers in India today
announced the inimitable achiever, cricketer Kapil Dev as their corporate brand
ambassador. The cricketing supreme will be endorsing BSLI in all its marketing
initiatives. Birla Sun Life Insurance is a value-driven brand which has a national
brand recall of 70 per cent. The objective of appointing a brand ambassador is to grow
its brand recall as it goes national in its distribution reach and fuel business growth.
As a brand ambassador, Kapil Dev will play a key role in the brand and product
marketing and promotional activities. BSLI has always used an integrated Marketing
BOARD OF DIRECTORS
Mr. Kumar Mangalam Birla
Mr. Jayant Dua
Mr. Kevin Strain
Dr. Rakesh Jain
Mrs. Tarjani Vakil
Mr. Ajay Shrinivasan
Mr. Bishwanath Puramalka
Mr. Gian Gupta
Mr. Suresh Talwar
Mr. Venkatesh Mysore
MANAGEMENT TEAM
Mr. Mayanka Bathwal (Deputy Chief Executive officer)
Mr. Sashi Krishnan (Chief Investment Officer)
Mr. Arun Malkani (Chief Marketing Officer)
Mr.Pramod Krishnamurthy (Head Information Technology)
Mr. Saurov Ghosh (Head Human Resources & Training)
Mr. Lalit Vermani (Head Compliance, Risk, Legal & Audit)
Mr. Vikas Seth (Chief Distribution Officer (CDO))
Mr. Anil Singh (Chief Actuarial Officer)
Mr. Amitabh Verma (Chief Operating Office)
PRODUCTS
All the plans associated with BSLI are Unit Linked Plans.
FLEXI PLANS
Flexi Plans have three variants. These variants are:
1. Flexi Save Plus (Endowment Plan)
2. Flexi Cash Flow (Money Back Plan)
3. Flexi Lifeline (Whole of Life Plan)
Features:
For Quarterly modal premium less than Rs.5000, payment can be made
through ECS.
Three Investment Fund options are available with the policy and policyholder
is free to switch between funds anytime during the tenure of the policy.
The Sum Assured may be increased once in every 5 policy years, starting from
the 6th policy year.
Benefits:
1. Maturity Benefits: At maturity, Policyholder gets the higher of the guaranteed
fund value (min. 3% on premium) or the Total Fund value.
2. Survival Benefits:
(i) At the end of every 5th Coverage Benefit Period and the remainder on
maturity, an amount equals to the minimum of (a) or (b) mentioned below
will be reduced from the guaranteed fund value and transferred to the
holding account for the purpose of partial withdrawals, where(a) Guaranteed Fund Value
(b) Sum Assured % as stated below:
If survival benefits are not withdrawn, they will continue to be a part of the
Fund Value.
(ii)
3. Death Benefits:
Age
at
time
of
Death
30 days to 1 year
Age 1 Year to 60
Year
On
or
Death Benefits
Fund Value Only
Higher of Sum Assured less all partial withdrawals made in
24 months preceeding the death of life insured or the fund
attainment of 60 since the life insured attained the age 58 or the fund value or
Years
Charges:
1. Mortality Charges: These charges are deducted by canceling units on a
monthly basis at the prevailing NAV. The annual mortality charges per 1000
sum assured for sample ages are as follows:
Age
20
30
40
50
60
Male
1.016 1.171 2.150 5.532 13.732
Female 0.896 1.163 1.657 4.030 10.660
2. Partial Withdrawal Charges: 2 withdrawals in a policy year are free of charge.
Rs100 for every additional partial withdrawal are charged.
CLASSIC LIFE PREMIER
This is the plan that not only helps to save for the future but also helps to get rich
benefits from the investments, especially at a time when the need for family
protection reduces significantly.
Features:
This plan has the option of seven-investment fund with the flexibility to
allocate the premiums in varying proportions into the different Fund Option.
The plan offers further benefits in the form of additional units, which will be
added to the Fund value at the end of the 10th policy year.
Death Benefits, which will be higher of the Fund value or Sum Assured,
reduced by the applicable partial withdrawals.
Eligibility:
Entry Age:
Minimum: 30 days for 20 & 30 term
8 years for 10 terms
30 years for whole life
Maximum: For 10 years term- 60 years
For 20 years term- 50 years
For 30 years term- 40 years
For Whole Life- 60 years
Duration:
Minimum: 10 years
Maximum: 70 years (assuming whole life to be 100 years)
Below 5 years: If the death of the life insured take place before 5 years,
only the fund value shall be payable to the policy owner.
60 years and Above: Higher of the fund value or the sum assured less
all applicable partial withdrawals made since the life insured attained
the age of 58.
5. Maturity Benefits: On maturity of the policy, the fund value is payable. Under
the whole life option, on maturity of the policy, when the life insured attains
the age of 100, then fund value is payable and the policy will be terminated.
6. Tax Benefits: Tax benefits on premium payment are governed by section 80C
of the Income Tax Act 1961. Tax Exemptions on the amount received on
maturity in the unfortunate event of death and the withdrawals are governed
by section 10(10D).
7. Addition of Riders: Policy holder can customize the plan by adding any of the
following 6 riders:
1. Accidental Death & Dismemberment Rider
2. Term Rider
3. Critical Illness Rider
4. Critical Illness Plus Rider
5. Critical Illness Women Rider
6. Waiver of Premium Rider
Charges:
1. Premium Allocation Charges: These charges during the premium paying term
are as under:
Policy Year
2 or 3
Thereafter
Charge
13%
4%
2%
25
35
45
55
65
Female
1.023
1.162
2.385
6.441
15.92
Male
1.083
1.363
3.110
8.571
21.06
monthly basis at the prevailing NAV. The Annual Mortality charge per 1000 of
the Sum at risk for sample ages are as follows:
Policy Year
Surrender
Charge
7+
6. Rider Premium Charge: If the riders are attached, this charge will be realized
by cancellation of units on a monthly basis based on the equivalent monthly
rider coverage premium payable, when rider coverage payment period equals
the rider coverage benefit period.
GOLD PLUS II PLAN
The plan gives much more than a good insurance cover, an opportunity to grow
investment for the medium term. It is worth more than Gold.
Features:
Eligibility:
1. Pitching the customer: The first and foremost thing is that, client should be ready
to purchase the Insurance plan. Insurance is not a very preferable product yet in India.
And,
thus, co. has to be very vigilant. Advisors, at BSLI, maintain relationships and make
the most of their Goodwill. Insurance is a Relationship oriented business. Keeping
this in mind BSLI also initiated Bancassurance, where Banks image of being loyal to
the customers, plays a major role in pitching the customer to buy Insurance. BSLI
uses following routes for distributing their Product to general public:
a. Direct Personal Contacts (through Advisors)
b. Bancassurance (through Banks)
c. Personal Relations (through co. employees)
d. Existing Policyholders.
2. Sales Illustration: BSLI is the first company to give demonstration of the fund
performance i.e. how a certain policy will perform or will give returns. BSLI Advisors
give sales illustration. Fund performance is shown on 6% and 10% projections. If
client find these projected returns suitable to his/her risk profile, he go for purchasing
the policy.
3. Proposal Form: Now as client is ready to get insured, advisor gives him the
proposal form and asks for all the documents required. Proposal form is a 4
page document that contains all the necessary information related to the
Insured and the Owner of the policy. Documents required along with the
proposal form are:
Date-Of-Birth Proof
Address & ID Proof
Income Certificate
Medical Certificates (only if Insurer is a senior citizen)
1. After Sales Service: Now after the Insurance is sold, follow-ups are required.
Advisor needs to maintain good relations with the policyholder. Insurance co.
can
Generate further business, only if, existing policyholders are satisfied with the
services being provided by the advisor of the co. Thus, BSLI keeps this in mind
and Business Development Executives continuously track the needs of the
policyholders. BSLI provides the policyholders with monthly updates of the fund
performance and
also discloses the asset portfolio of the fund. This assists the policyholders to
manage their policy according to their risk profile. They can, thus, change their
fund allocation as well as the asset allocation in any fund, chosen by them.
In the Unfortunate
event of the Death of the Life Insured prior to the maturity date of the policy,
the nominee gets the greater of
(a) Fund Value
(b) Sum Assured reduced for partial withdrawal as follows:
Before the life insured attains the age of 60, the sum assured
payable on death is reduced by partial withdrawals made in
the preceeding years.
Once the Life Insured attains the age of 60, the Sum Assured
payable on death is reduced by all partial withdrawals made
from age 58 onwards.
3. Tax Benefits:
Policyholder is eligible for tax benefits U/S 80C and U/S 10(10D) of the
Income Tax Act 1961.
U/S 10(10D) - The Benefits received under plan are exempted from
tax.
Charges:
1. Premium Allocation Charges:
It is deducted from premium when received and before allocation of units.
Policy
2.
Policy Years
Charges
1
On
Policy
Premium
8%
On
top-up
4%
4%
Premium
2%
Management Charges:
2%
2%
4+
2%
Fund
Fund Management charge not exceeding 1.5% per annum of the fund value
will be charged by adjustments of the daily unit price. The charge is
Policy Years
Charges
Policy
4+
Administration
19.4
19.4
19.4
14.4
Charge *
* An additional 5 per 1000 will be charged in the first 3 policy years only on
any excess Sum Assured over Rs. 50000
4. Mortality Charges: These charges are deducted on a monthly basis. These
charges are taken by canceling units proportionately from each of the
investment funds at that time. The annual rate per 1000 of Sum Assured less
fund value for sample ages are:
Age
25
35
45
55
65
Female
1.023
1.162
2.385
6.441
15.92
Male
1.083
1.363
3.110
8.571
21.06
It provides the nominee with an increased sum assured and builds savings
faster.
Partial Withdrawals, are allowed, after 3 years to meet liquidity needs of the
policyholder
Duration:
Assure
2.
Protector
3.
Builder
4.
Enhancer
5.
Creator
6.
Magnifier
Benefits:
1. Death Benefits:
Increasing Death benefits i.e. Death Benefit= Sum Assured + 25% every
5th year
Charges:
1. Mortality Charges: Charges are deducted monthly by canceling units from the
associated fund option. The charge is 95%
2. Policy Administration Charges: These charges are deducted monthly by
canceling units from the investment fund. The annual charge is Rs. 720 on the
first 1000 Sum Assured in all years i.e. Rs.3.60 per 1000 Sum Assured p.a.
The additional charges for years 1-5 are as follows:
Term
Band 1
Band 2
Band 3
10/15
4.75
4.25
4.00
20+
3.75
3.25
3.00
3. Premium Allocation Charges: These charges are 5% for the 1 st policy year and
2% for subsequent policy years.
4. Fund Management Charges: These charges are 1 1.25% p.a. for all
associated funds.
Full Liquidity after three policy years to meet any cash needs.
Unique Guaranteed Maturity Unit Price representing the highest unit plus
price of Platinum Plus Fund I recorded on 88 reset dates starting on March 17,
2008 and ending on June 15, 2015.
Eligibility:
Premium Collected is invested in the Equity & Debt Market according to the
preset Asset Allocation of the Platinum Plus Fund I.
Benefits:
1. Guaranteed Maturity Unit Price
2. Maturity Benefits
3. Surrender Benefits
4. Death Benefits
Higher of Fund Value (as per the then prevailing unit price) or Sum Assured
(less applicable partial withdrawals)
5. Tax Benefits
U/S 10(10D) - Benefits from the plan are exempted from tax.
Charges:
1. Premium Allocation Charges: 10% of premium in the first year and 4% of
premium in subsequent years.
2. Fund Management Charges: 1.00%-1.50% p.a. for Assure & 1.50%-2.00%
p.a. for Platinum Plus Fund I.
3. Policy Administration Charges: These charges are deducted monthly by
canceling units from the investment fund Assure first and then, from Platinum
Plus I, if required. The annual charge is Rs. 720 on the first 1000 Sum Assured
in all years plus Rs.6 per 1000 Sum Assured in years 1 to 3 only.
4. Mortality Charges: Charges are deducted monthly by canceling units from the
associated investment funds. The Annual Charges for sample ages are as
follows:
Attained Age 25
35
45
55
65
Female
Male
FUNDS BY BSLI
Birla Sun Life Insurance, a leading Life Insurance company, offers its clients with a
long range of Funds. These funds are designed to cater to a variety of needs of people
who are from different life stages. BSLI offers a broad range of 12 funds, each having
differing asset allocations.
12 funds offered are:
1. Individual Protector
2. Individual Assure
3. Individual Balancer
4. Individual Builder
5. Individual Creator
6. Individual Enhancer
7. Individual Life Maximiser
8. Individual Magnifier
9. Individual Multiplier
10. Pension Nourish
11. Pension Enrich
12. Pension Growth
A new fund named Platinum Plus Fund I is also added in this list of funds.
Asset Allocation is decided by the Fund Managers of the company. These fund
managers continuously tracks the movements of volatile market and combine this
volatility with the fund requirements of the policyholders. Accordingly he decides
allocation of assets in 5 major investment options:
Government Securities
Corporate Debt
Securitized Debt
Equity
Proportion of allocating the fund in these options, vary according to the needs and
fund requirements of policyholders. The most important thing to be noticed here is
that this portfolio is decided, based on the regulations of IRDA. Performances of these
funds are rated by the rating agency-CRISIL.
All the 12 funds by BSLI are described below along with their respective Asset
Allocations.
Individual Assure
Objective: The primary objective of this fund is to provide Capital Protection, at a
high level of safety and liquidity through judicious investments in high quality shortterm debt.
Strategy: Generate better return with low level of risk through investment into fixed
interest securities having short-term maturity profile.
Asset Allocation:
SECURITIES
HOLDING
Corporate Debt
59.57%
17.97%
TOTAL
100.00%
Individual Balancer
Objective: The objective of this fund is to achieve value
creation of the policyholder at an average risk level over
medium to long-term period.
Strategy: The strategy is to invest predominantly in
debt securities with an additional exposure to equity,
maintaining medium term duration profile of the
portfolio.
Asset Allocation:
SECURITIES
HOLDINGS
Government Securities
10.67%
Corporate Debt
39.04%
Equity
23.44%
26.85%
TOTAL
100.00%
Pension Growth
Objective: This fund option is designed to build the
capital and to generate better returns at moderate level
of risk, over a medium or long-term period through a
balance of investment in equity and debt.
Strategy: Generate better return with moderate level of
risk through active management of fixed income
portfolio and focus on creating long term equity
portfolio which will enhance yield of composite
portfolio with low level of risk appetite.
Asset Allocation:
SECURITIES
HOLDINGS
Government Securities
13.90%
Corporate Debt
45.41%
Equity
18.63%
22.06%
100.00%
SWOT ANALYSIS
STRENGTH:
Company has maximum number of MDRT as well as good number of HNI advisors.
WEAKNESS:
OPPORTUNITY:
Insurance market is very big, where company can expand its horizon in insurance
industry.
The huge insurance market (77%) is left so company has opportunity to expand our
products.
THREATS:
OLD HABITS DIE HARD: Its still difficult task to win the confidence of public
towards private company.
The company is facing major threats from LIC -which is an only government
company.
Plans for all income groups is not available which can create adverse effect later on
the market share of the company.