RESEARCH REPORT Reliance Capital

8/6/2019 RESEARCH REPORT Reliance Capital

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RESEARCH REPORT

ON

A STUDY INTO ULIP SCHEMES OF RELIANCE CAPITAL

BACHELOR OF BUSSNESS ADMINISTRATION

BANKING AND INSURANCE

UNDER THE GUIDANCE OF: - SUBMITTED BY:

MISS. SHASHANK JAIN

ROLL No: 07312341808


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PREFACE

The liberalization of the Indian insurance sector has been the subject of much

heated debate for some years. The policy makers where in the catch 22 situation

wherein for one they wanted competition, development and growth of this

insurance sector which is extremely essential for channeling the investments in to

the infrastructure sector. At the other end the policy makers had the fears that the

insurance premium, which are substantial, would seep out of the country; and

wanted to have a cautious approach of opening for foreign participation in the

sector.

As one of the rare occurrences the entire debate was put on the back burner and the

IRDA saw the day of the light thanks to the maturing polity emerging consensus

among factions of different political parties. Though some changes and some

restrictive clauses as regards to the foreign participation were included the IRDA

has opened the doors for the private entry into insurance.

Whether the insurer is old or new, private or public, expanding the market will present multitude of challenges and opportunities. But the key issues, possibletrends, opportunities and challenges that insurance sector will have still remainsunder the realms of the possibilities and speculation.

ACKNOWLEDGEMENT

I would like to thank Dr. (Director) to give me guidelines and my worthythanks to my teacherMISS. and all DELHI INSTITUTE OF RURALDEVELOPMENT for their valuable contribution during the academic sessionand guidance in preparation of this research report.

I would like to dedicate this project to my parents. Without their help and constantsupport this project would not have been possible.


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SHASHANK JAIN

DECLARATION

I SHASHANK JAIN of BBA 6th Sem of DELHI INSTITUTE OF RURAL

DEVELOPMENT hereby declare that the research report entitled in UNIT

LINK INSURACNE PLANS is an original word and the same has not been

submitted to any other institute for the award of any other degree.

SHASHANK JAIN


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BBA(B&I) 6th SEM

\ TABLE OF CONTENTS

Preface

Acknowledgement

Declaration

CHAPTER 1:-

An Introduction to Ulip plans

CHAPTER 2:-

A FROFILE OF RELIANCE CAPITAL AND RELIANCE MUTUL FUND

CHAPTER 3:-

Project profile and unit linked plans of reliance

capital

Research methodology

Importance of the study

Objective

Hypothesis

Sample size and type

Statistical tool

CHAPTER 4:-


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Data interpretation and analysis

CHAPTER 5:-

Findings & suggestion

CHAPTER 6:-

Conclusion

Anexxure

Questionnaire

Bibliography


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CHAPTER 1:-

An Introduction to Ulip plans

ULIPS

what is ULIP?

ULIP stands for Unit Linked Insurance Plans. As we know that insurance is for

protecting our life from the any uncertain events like death or accident. The

purpose of the normal insurance plan is just protecting the life but not ensuring any

savings for the future. Many people wanted plan which gives protection also gives

the returns for their investment. So, insurance companies come up with the ULIP

plan where the premium about is invested in the share market and returns better

income on the maturity period.

PLATFORMS OF LIFE INSURANCE- UNIT LINKED INSURANCE PLANS


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World over , insurance come in different forms and shapes . although the generic

names may find similar , the difference in product features makes one wonder

about the basis on which these products are designed .With insurance market

opened up , Indian customer has suddenly found himself in a market place where

he is bombarded with a lot of jargon as well as marketing gimmicks with a very

little knowledge of what is happening . This module is aimed at clarifying these

underlying concepts and simplifying the different products available in the market.

We have many products like Endowment , Whole life , Money back etc. All these

products are based on following basic platforms or structures viz.

Traditional Life

Universal Life or Unit Linked Policies

3.1 TRADITIONAL LIFE AN OVERVIEW

The basic and widely used form of design is known as Traditional Life Platform. It

is based on the concept of sharing . Each of the policy holder contributes his

contribution (premium) into the common large fund is managed by the company on

behalf of the policy holders.

Administration of that common fund in the interest of everybody was entrusted to

the insurance company .It was the responsibility of the company to administer

schemes for benefit of the policyholders. Policyholders played a very passive roll .

In the course of time , the same concept of sharing and a common fund was

extended to different areas like saving , investment etc.


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A Unit Link Insurance Policy (ULIP) is one in which the customer is provided

with a life insurance cover and the premium paid is invested in either debt or

equity products or a combination of the two. In other words, it enables the buyer to

secure some protection for his family in the event of his untimely death and at the

same time provides him an opportunity to earn a return on his premium paid. In the

event of the insured person's untimely death, his nominees would normally receive

an amount that is the higher of the sum assured or the value of the units

(investments).

To put it simply, ULIP attempts to fulfill investment needs of an investor with

protection/insurance needs of an insurance seeker. It saves the investor/insurance-

seeker the hassles of managing and tracking a portfolio or products. More

importantly ULIPs offer investors the opportunity to select a product which

matches their risk profile.

Unit Linked Insurance Plans came into play in the 1960s and became very popular

in Western Europe and Americas. In India The first unit linked Insurance Plan ,

popularly known as ULIP Unit Linked Insurance Plan in India was brought out

by Unit Trust Of India in the year 1971 by entering into a group insurance

arrangement with LIC o provide for life cover to the investors , while UTI , as a

mutual was taking care of investing the unit holders money in the capital market

and giving them a fair return .

Subsequently in the year 1989 , another Unit Linked Product was launched by the

LIC Mutual Fund called by the name of DHANARAKSHA which was more or

less on the line of ULIP of UTI . Thereafter LIC itself came out with a Unit Linked

Insurance Product known by name BIMA PLUS in the year 2001-02 .


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Presently a number of private life insurance companies have launched Unit Linked

Insurance Products with a variety of new features.

TYPES OF ULIP

There are various unit linked insurance plans available in the market. However, the

key ones are pension, children, group and capital guarantee plans.

The pension plans come with two variations with and without life cover and

are meant for people who want to generate returns for their sunset years.

The children plans, on the other hand, are aimed at taking care of their educational

and other needs..

Apart from unit-linked plans for individuals, group unit linked plans are also

available in the market. The Group linked plans are basically designed for

employers who want to offer certain benefits for their employees such as gratuity,

superannuation and leave encashment.

The other important category of ULIPs is capital guarantee plans. The plan

promises the policyholder that at least the premium paid will be returned at

maturity. But the guaranteed amount is payable only when the policy's maturity

value is below the total premium paid by the individual till maturity. However, the

guarantee is not provided on the actual premium paid but only on that portion of

the premium that is net of expenses (mortality, sales and marketing,

administration).


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How ULIPs work

ULIPs work on the lines of mutual funds. The premium paid by the client (less any

charge) is used to buy units in various funds (aggressive, balanced or conservative)

floated by the insurance companies. Units are bought according to the plan chosen

by the policyholder. On every additional premium, more units are allotted to his

fund. The policyholder can also switch among the funds as and when he desires.

While some companies allow any number of free switches to the policyholder,

some restrict the number to just three or four. If the number is exceeded, a certain

charge is levied.Individuals can also make additional investments (besides premium) from time to

time to increase the savings component in their plan. This facility is termed "top-

up". The money parked in a ULIP plan is returned either on the insured's death or

in the event of maturity of the policy. In case of the insured person's untimely

death, the amount that the beneficiary is paid is the higher of the sum assured

(insurance cover) or the value of the units (investments). However, some schemes

pay the sum assured plus the prevailing value of the investments.

ULIP - KEY FEATURES

Premiums paid can be single, regular or variable. The payment period too

can be regular or variable. The risk cover can be increased or decreased.

As in all insurance policies, the risk charge (mortality rate) varies with age.


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The maturity benefit is not typically a fixed amount and the maturity period

can be advanced or extended.

Investments can be made in gilt funds, balanced funds, money market funds,

growth funds or bonds.

The policyholder can switch between schemes, for instance, balanced to debt

or gilt to equity, etc.

The maturity benefit is the net asset value of the units.

The costs in ULIP are higher because there is a life insurance component in

it as well, in addition to the investment component.

Insurance companies have the discretion to decide on their investmentportfolios.

Being transparent the policyholder gets the entire episode on the

performance of his fund.

ULIP products are exempted from tax and they provide life insurance.

Provides capital appreciation.

Investor gets an option to choose among debt, balanced and equity funds.


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USP of ULIPS

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.

Multiple investment options

ULIPS offer a lot more variety than traditional life insurance plans. So there are

multiple options at the individuals disposal. ULIPS generally come in three broad

variants:

Aggressive ULIPS (which can typically invest 80%-100% in equities,

balance in debt)

Balanced ULIPS (can typically invest around 40%-60% in equities)

Conservative ULIPS (can typically 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. Individuals can opt

for a variant based on their risk profile.

Flexibility

The flexibility with which individuals can switch between the ULIP variants to

capitalise on investment opportunities across the equity and debt markets is what

distinguishes it from other instruments. Some insurance companies allow a certain

number of free switches. Switching also helps individuals on another front. They

can shift from an Aggressive to a Balanced or a Conservative ULIP as they


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approach retirement. This is a reflection of the change in their risk appetite as they

grow older.

Works like an SIP

Rupee cost-averaging is another important benefit associated with ULIPS. With an

SIP, individuals invest their monies regularly over time intervals of a

month/quarter and dont have to worry about timing the stock markets.

HURDLES OF ULIP

NO STANDARDIZATION

All the costs are levied in ways that do not lend to standardisation. If one company

calculates administration cost by a formula, another levies a flat rate. If one

company allows a range of the sum assured (SA), another allows only a multiple of

the premium. There was also the problem of a varying cost structure with age


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CHAPTER 2:-

A profile of reliance capital and reliance mutual fund

THE INSURANCE INDUSTRY IN INDIA

AN OVERVIEW

With the largest number of life insurance policies in force in the world, Insurance

happens to be a mega opportunity in India. Its a business growing at the rate of

15-20 per cent annually and presently is of the order of Rs 1560.41 billion (for thefinancial year 2006 2007). Together with banking services, it adds about 7% to

the countrys Gross Domestic Product (GDP). The gross premium collection is

nearly 2% of GDP and funds available with LIC for investments are 8% of the

GDP.


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Even so nearly 65% of the Indian population is without life insurance cover while

health insurance and non-life insurance continues to be below international

standards. A large part of our population is also subject to weak social security and

pension systems with hardly any old age income security

A well-developed and evolved insurance sector is needed for economic

development as it provides long term funds for infrastructure development and

strengthens the risk taking ability of individuals. It is estimated that over the next

ten years India would require investments of the order of one trillion US dollars.

HISTORICAL PERSPECTIVE

The history of life insurance in India dates back to 1818 when it was conceived as

a means to provide for English Widows. Interestingly in those days a higher

premium was charged for Indian lives than the non - Indian lives, as Indian lives

were considered more risky to cover. The Bombay Mutual Life Insurance Society

started its business in 1870. It was the first company to charge the same premium

for both Indian and non-Indian lives.

The Oriental Assurance Company was established in 1880. The General insurance

business in India, on the other hand, can trace its roots to Triton Insurance

Company Limited, the first general insurance company established in the year

1850 in Calcutta by the British. Till the end of the nineteenth century insurance

business was almost entirely in the hands of overseas companies.

Insurance regulation formally began in India with the passing of the Life Insurance

Companies Act of 1912 and the Provident Fund Act of 1912. Several frauds during

the 1920's and 1930's sullied insurance business in India. By 1938 there were 176

insurance companies.


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The first comprehensive legislation was introduced with the Insurance Act of 1938

that provided strict State Control over the insurance business. The insurance

business grew at a faster pace after independence. Indian companies strengthened

their hold on this business but despite the growth that was witnessed, insurance

remained an urban phenomenon.

The Government of India in 1956, brought together over 240 private life insurers

and provident societies under one nationalized monopoly corporation and Life

Insurance Corporation (LIC) was born. Nationalization was justified on the

grounds that it would create the much needed funds for rapid industrialization. This

was in conformity with the Government's chosen path of State led planning and

development.

The non-life insurance business continued to thrive with the private sector till

1972. Their operations were restricted to organized trade and industry in large

cities. The general insurance industry was nationalized in 1972. With this, nearly

107 insurers were amalgamated and grouped into four companies- National

Insurance Company, New India Assurance Company, Oriental Insurance Company

and United India Insurance Company. These were subsidiaries of the General

Insurance Company (GIC).


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Company Profile

Reliance money is a part of the reliance Anil Dhirubai Ambani Group and is

promoted by Reliance capital, the fastest growing private sector financial services

company in India, ranked amongst the top 3 private sector financial companies in

terms of net worth.

Reliance money is a comprehensive financial solution provider that enables you to

carry out trading and investment activities in a secure, cost-effective and

convenient manner. Through reliance money, you can invest in a wide range of

asset classes from Equity, Equity and commodity Derivatives, Mutual Funds,

insurance products, IPOs to availing services of Money Transfer & Money

changing.

Reliance Money offers the convenience of on-line and offline transactions through

a variety of means, including its Portal, Call & Transact, Transaction Kiosks and at

its network of affiliates.

Some key steps of the company that are as..

Reliance Capital

RelianceLife Insurance

RelianceGeneral Insurance

Unit linknsurance

plans

RelianceConsumer

Finance

RelianceMutual fundMutual Fund


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Success is a journey, not a destination. If we look for examples to prove this

quote then we can find many but there is none like that of Reliance Money. The

company which is today known as the largest financial service provider of India.

Success sutras of Reliance Money:

The success story of the company is driven by 8 success sutras adopted by it

namely trust, integrity, dedication, commitment, enterprise, hard work and

team play, learning and innovation, empathy and humility. These are the

values that bind success with Reliance Money.

Vision of Reliance Money

To achieve & sustain market leadership, Reliance Money shall aim for completecustomer satisfaction, by combining its human and technological resources, to

provide world class quality services. In the process Reliance Money shall strive to

meet and exceed customer's satisfaction and set industry standards.

Mission statement:

Our mission is to be a leading and preferred service provider to our

customers, and we aim to achieve this leadership position by building an

innovative, enterprising , and technology driven organization which will set

the highest standards of service and business ethics.

BUSINESS OVERVIEW

Reliance Capital has interests in asset management and mutual funds, life and

general insurance, private equity and proprietary investments, stock broking,

depository services, distribution of financial products, consumer finance and other


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activities in financial services.

Reliance Mutual Fund is India's no.1 Mutual Fund. Reliance Life Insurance is

India's fastest growing life insurance company and among the top 4 private sector

insurers. Reliance General Insurance is India's fastest growing general insurance

company and the top 3 private sector insurers. Reliance Money is the largest

brokerage and distributor of financial products in India with more than 2.5 million

customers and the largest distribution network. Reliance Consumer finance has a

loan book of over Rs. 8,000 crores at the end of June 2008.

Reliance Capital has a net worth of Rs.6, 862 crores (US$ 1.6 billion) and total

assets of Rs. 19,940 crores (US$ 4.6 billion) as of June 30, 2008 and over 26,000

employees.

Money has increased its market share among private financial companies to nearly

Convenient & effective Anytime & anywhere financial transaction capability.

Launched in April 2007. It provides the Flat fees system. It has 2.2 million

customers in 1 year of official launch. It has over 5,000 outlets across 700

towns/cities. Average daily turnover in excess of Rs 2,000 crores.

Considering the entire life market, including the Rs. 12,890 crores booked by life

insurance Corporation, Reliance life insurance market share works out to around

6.25%.

The life insurance market continuous to be dominated by LIC which has about

67% share this only a marginal dip from its 73% share in end-July. These

comparisons are only for first year or new business premium.

The gap between Reliance life insurance and the second-in-line private insurer is

vast. In fact, this scenario has led some analysts to wonder if the company is not a

trifle too aggressive. But others say this has more to do with the companies

customer-centric focus, its pan-India presence and superior risk management and

investment strategies. Reliance Money is not, however, resting on its laurels.


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Companys customer centric approach will be studied during the training period

and the finding of the research work will definitely focus on the present condition

& future requirement (if any) relating to products of company.

Reliance Life Insurance

Demat Account Services

Reliance Mutual Funds

Reliance General Insurance


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Reliance Life Insurance, a part of the Reliance - Anil Dhirubhai Ambani Group is

India's fastest growing life insurance company and among the top 4 private sector

life insurers.

Reliance Life Insurance has a pan India presence and a range of products catering

to individual as well as corporate needs. Reliance Life Insurance has over 700

branches and 1, 80,000 agents. It offers 26 products covering savings, protection

& investment requirements. Reliance Life Insurance will endeavor to attain a

leadership position in the market over the next few years, by further expanding and

strengthening its distribution network and offering a diverse array of products to

suit the varied and specific needs of individual customers.

Basics of Life Insurance

What is Life Insurance?


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An amount of money paid to someone (called beneficiary) when the Life Assured

(in whose name the insurance policy is taken) dies. This amount can be used to pay

the expenses related to Life assureds death or can be invested to generate income

that will replace your salary. Life Insurance is an important tool in any investors

portfolio & can be used for - wealth creation, asset building, provide for

contingencies and retirement planning.

Types of Life Insurance Policies

Most Insurance policies are a combination of Savings & Protection.

Products are formulated by either increasing or decreasing either one of

these components.

These combinations can be broadly divided into 4 groups

- ULIPs

- Term Insurance- Endowment Policies : Whole Life; Unit Linked etc

- Annuities & Pension

The main reason to buy Life Insurance is to

provide income replacement for your loved ones


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Life Stage in Life Insurance


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18-25(Unmarrie

d)

30-45 yearsCouples withchildren

45 yrs andaboveMaturedcouple Retire

d

25-30Marriedcoupleswith nokids

No dependents/liabilities

therefore need

for insurance isless

Introduction ofdependents. Start

of financialplanning balance

between assetcreation &protection

Peak earning agerange. High asset

creation & build upof liabilities. Critical

stage fordependents Asset base build

up & liabilitiesreduced/ taken

care of. Need forretirement

planning morethan protection.

Need forprotection low.

Greater need forregular income

flow.

Endowment / ULIPs Endowment / ULIPs +Term Annuities

At each stage, requirements, responsibilities and Financialneeds differ


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Need Analysis in life Stages

AGE STATUS INSURANCE

NEEDS

SUGGESTED

PRODUCTS

18yrs -

25yrs

Unmarried 1.Go on a

holiday

2.Buy a new Car

3.Set up a new

house

4.Set up Interiors

5.Buy jewellery

Short Term

Endowment Product

25yrs-30yrs

Married

1.High Debt,

highexpenditure

Phase

2.Family

dependency on

your income

3.Low

accumulated

wealth

4.Need for

Planning

Temporary term orwhole life Product


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Requirement

30yrs -

45yrs

Matured

couple

1.Retirement

Planning

2.Wealth

transfer or

saving vehicles

3.Returns on

investment

4.Opting for

guaranteed

Product

Profits or Unit

Linked Endowment/

Deferred annuities


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Life Stage Example

Hello, I am Philip, sailor.Hello, I am Philip, sailor.Have seen the world.Have seen the world.

Always on cruise and keep Always on cruise and keepworrying about family andworrying about family andthe loans. I need financialthe loans. I need financialProtection if I do not returnProtection if I do not return

from one voyagefrom one voyageSavera has justSavera has justcome to our lives. Ascome to our lives. As

proud parents, We proud parents, Weneed to protect herneed to protect heras well as create heras well as create herown financialown financialstandingstanding

Worked for almostWorked for almost25 years, now want25 years, now wantto liveto live. I want. I wantsomething that willsomething that willmake my life Chinta-make my life Chinta-free afterfree afterretirementretirement..

Endowment

Term

Annuities


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Products of Life Insurance

Life Insurance products are usually referred to as plans of insurance. These plans

have two basic elements; one is the Death Cover providing for the benefits being

paid on the death of the insured person within a specified period. The other is the

Survival Benefit providing for the benefit being paid on survival of a specified

period.

Plans of insurance that provide only death cover are called Term

Assurance Plans.

Plans of insurance that provide only survival benefits are called Pure

Endowment Plans.

Term Life Insurance

Term Life Insurance provides protection for a specified period of time. A death

benefit is paid to the beneficiary if the insured dies within a specified period of

time while the policy is still in force.

Whole Life Insurance

Whole Life insurance is a permanent life insurance and provides protection for life.

As long as premiums are paid, a death benefit is paid to the beneficiary.

ULIPs


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A ULIP is a life insurance which provides a combination of Life Insurance

protection and investment. Money can be invested in the following fund:- Equity

Fund, Debt Fund, Money Market Fund (Liquid Fund) and Balance Fund.

Annuities

Annuities are practically the same as pension. Pension provides periodical

payments to the employees, who have retired. They are paid as long as the

recipient is alive.Annuities are called the reverse of Life Insurance.

Protection Plans

Protect your family even when youre not around by investing in Reliance

Protection Plans. Choose a limited period plan or a lifetime protection plan

depending on your needs. The latest Protection Plans are as below

1. Reliance Term plan

2. Reliance Simple Term plan

3. Reliance Special Term plan

4. Reliance Credit Guardian plan

5. Reliance Special Credit Guardian plan6. Reliance Endowment plan

7. Reliance Special Endowment plan

8. Rel iance Connect 2 Life plan

9. Reliance Whole Life plan
http://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/TermPlan/RTP_reliance_term_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SimpleTermPlan/RSimpleTP_reliance_simple_term_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialTermPlan/RSTP_reliance_special_term_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/CreditGuardianPlan/RCGP_reliance_credit_guardian_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialCreditGuardianPlan/RSCGP_reliance_special_credit_guardian_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/EndowmentPlan/REP_reliance_endowment_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialEndowmentPlan/RSEP_reliance_special_endowment_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/Connect2Life/RC2LP_reliance_connect_2_life_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WholeLifePlan/RWLP_reliance_whole_life_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/TermPlan/RTP_reliance_term_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SimpleTermPlan/RSimpleTP_reliance_simple_term_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialTermPlan/RSTP_reliance_special_term_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/CreditGuardianPlan/RCGP_reliance_credit_guardian_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialCreditGuardianPlan/RSCGP_reliance_special_credit_guardian_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/EndowmentPlan/REP_reliance_endowment_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialEndowmentPlan/RSEP_reliance_special_endowment_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/Connect2Life/RC2LP_reliance_connect_2_life_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/Connect2Life/RC2LP_reliance_connect_2_life_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WholeLifePlan/RWLP_reliance_whole_life_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspx


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10. Reliance Wealth + Health plan

11. Reliance Cash Flow plan

Savings & Investment Plans

Reliance Savings & Investment Plans help you to set aside some money to achieve

specific goals in life, which means that you can enjoy life and provide for your

familys daily needs. The savings and investment Plans are as below

1. Reliance Total Investment Plan Series I - Insurance


3. Reliance Automatic Investment plan

4. Reliance Money Guarantee plan

5. Reliance Cash Flow plan

6. Reliance Market Return plan

7. Reliance Endowment plan

8. Reliance Special Endowment plan

9. Reliance Whole Life plan

10. Reliance Golden Years Plan

11. Reliance Golden Years Plan Value

12. Reliance Golden Years Plan Plus

13. Reliance Connect 2 Life plan

Retirement Plans

Invest today in Reliance Retirement Plans and save money to enjoy life even after

retirement. You will never have to depend on another person or make any

compromises to maintain your current lifestyle. The latest Retirement Plans are as

below

1. Reliance Total Investment Plan Series II Pension
http://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WealthHealth/RWHP_reliance_wealth_health_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/CashFlowPlan/RCFP_reliance_cash_flow_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/TotalInvestmentPlan-Insurance/RTIP_seriesI_insurance.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WealthHealth/RWHP_reliance_wealth_health_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/AutomaticInvestmentPlan/RAIP_reliance_automatic_investment_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/MoneyGuaranteePlan/RMGP_reliance_money_guarantee_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/CashFlowPlan/RCFP_reliance_cash_flow_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/MarketReturnPlan/RMRP_reliance_market_return_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/EndowmentPlan/REP_reliance_endowment_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialEndowmentPlan/RSEP_reliance_special_endowment_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WholeLifePlan/RWLP_reliance_whole_life_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/GoldenYearsPlan/RGYP_reliance_golden_years_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/GoldenYearsPlanValue/RGYPV_reliance_golden_years_plan_value.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/GoldenYearsPlanPlus/RGYPP_reliance_golden_years_plan_plus.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/Connect2Life/RC2LP_reliance_connect_2_life_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/RetirementPlans/retirement_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/TotalInvestmentPlan-Pension/RTIP_seriesII_pension.aspx?from=Retirement%20Plans&path=RetirementPlans/retirement_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WealthHealth/RWHP_reliance_wealth_health_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/CashFlowPlan/RCFP_reliance_cash_flow_plan.aspx?from=Protection%20Plans&path=ProtectionPlans/protection_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/TotalInvestmentPlan-Insurance/RTIP_seriesI_insurance.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WealthHealth/RWHP_reliance_wealth_health_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/AutomaticInvestmentPlan/RAIP_reliance_automatic_investment_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/MoneyGuaranteePlan/RMGP_reliance_money_guarantee_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/CashFlowPlan/RCFP_reliance_cash_flow_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/MarketReturnPlan/RMRP_reliance_market_return_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/EndowmentPlan/REP_reliance_endowment_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/SpecialEndowmentPlan/RSEP_reliance_special_endowment_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/WholeLifePlan/RWLP_reliance_whole_life_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/GoldenYearsPlan/RGYP_reliance_golden_years_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/GoldenYearsPlanValue/RGYPV_reliance_golden_years_plan_value.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/GoldenYearsPlanPlus/RGYPP_reliance_golden_years_plan_plus.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/Connect2Life/RC2LP_reliance_connect_2_life_plan.aspx?from=Savings%20%26%20Investment%20Plan&path=SavingsnInvestmentPlan/savings_n_investment_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/RetirementPlans/retirement_plan.aspxhttp://www.reliancelife.com/rlic/Products/SolutionsforIndividuals/Plans/TotalInvestmentPlan-Pension/RTIP_seriesII_pension.aspx?from=Retirement%20Plans&path=RetirementPlans/retirement_plan.aspx


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2. Reliance Golden Years Plan

3. Reliance Golden Years Plan Value

4. Reliance Golden Years Plan Plus


6. Reliance Automatic Investment Plan

7. Reliance Money Guarantee Plan

Child Plans

Save systematically and secure your childs future needs by investing in Reliance

Child Plans. You can always be there for your child when he or she needs you. The

Childs plans are as below

1. Reliance Child plan

2. Reliance Secure Child plan


Market Return Plan

Under This plan the investment risk in the investment portfolio is borne by the

policyholder.

key features

Twin benefit of market linked return and insurance protection
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A unit linked plan, different from traditional life insurance products with

maximum maturity age of 80 years.

Option to create your own portfolio depending on your risk appetite.

Choose from four different investment funds

Flexibility to switch between funds

Option to pay regular as well as single premium & top- ups

Option to package your policy with accidental rider

Flexibility to increase the sum assured

Liquidity through partial withdrawals

How does this plan work

The premium paid by the client net of premium allocation charges is invested in

fund/funds of your choice and units are allocated depending on the price of

units for the fund/funds. The fund value is the total value of units that you hold

in the fund/funds. The mortality charges and policy administration charges are

ducted through cancellation of units whereas the fund management charge is

priced in the unit value.

Benefits

Life cover Assured: in case of unfortunate loss of life, the beneficiary will get

sum assured or fund value, whichever is higher. The client can choose the basic

sum assured within the minimum and maximum levels mentioned below.

Minimum sum Assured:

Regular premium: annualized premium for 5 years or annualized premium

for half the policy term, whichever is higher.

Single premium: 125% of the single premium.


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Maximum sum Assured

No limit (50000 for age up to 12 years)

Maturity Benefits

On survival to maturity the fund value on maturity will be paid out.

Rider Benefits

The Client can add the Accidental Death & Total and Permanent Disablement

Benefit Rider (available only with the regular premium option).

This benefit doubles the life coverage in case of accidental death or accidental total

and permanent disablement at a very nominal additional cost. The maximum cover

is Rs. 50, 00,000 per life.

In case of accidental death of the life assured during the policy term, the accident

benefit sum assured will be paid immediately in a lump sum.

In case of accidental total and permanent disablement, 1/10th of the accident benefit

sum assured will be paid at the end of each year for ten years. If the total and

permanent disablement has commenced, the accidental death benefit cover ceases.

In case of maturity or on death of the life assured before payment of all

installments of accidental total and permanent disablement benefits, the remaining

unpaid installments of any will be paid in one lump sum along with death or

maturity benefit.

Accidental total and permanent disablement means disability caused by bodily

injury, which causes permanent inability to perform any occupation or to engage in

any activities for remuneration or profits. This disability should last for at least 6

months before being eligible for accidental total and permanent disablement

benefits.

Accidental total and permanent disablement includes loss of both arms and both

legs or one arm and one leg or of both eyes. Loss of arms or legs means


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dismemberment by amputation of the entire hand or foot. Loss of eyes means

entire and irrecoverable loss of sight.

What are the different fund options.

We understand the value of your hard earned money and in our Endeavour to help

you grow your wealth, we offer you 4 different tailor-made investment funds. You

have the option to allocate your premium in these funds as you wish.

1. Capital Secure Fund:

The investment objective of this fund is to maintain the value of all contributions

(net of charges) and all interest additions. This fund offers steady return for little

risk. The risk profile of this fund is low. Investments would be 100% in bank

deposits, government bonds and debt instruments that offer financial security.

Further, allocation in Capital Secure Fund for a policy is subject to a maximum

limit of 40% at any time.

2. Balanced Fund:

The investment objective of this fund is to provide you with investment returns,

which exceed the rate of inflation in the long term while maintaining a low

probability of negative investment returns. Here, a major portion of your funds are

invested in Fixed Securities while a small percentage is invested in the equity

market, which is exposed to market movements. The risk profile of this fund is low

to medium.

Investments would be at least 80% in fixed interest securities and maximum 20%

in equities.


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3. Growth Fund:

The investment objective of this fund is to provide you with investment returns,

which exceed the rate of inflation in the long term while maintaining a moderate

probability of negative investment returns. A greater portion of your funds are

invested in fixed securities while a small percentage is invested in the equity

market, which exposed to market movements. The risk profile of this fund is

medium to high.

Investment would be at least 60% in fixed interest securities and maximum 40% in

equities.

4. Equity Fund:

The investment objective of this fund is to provide policyholders with high

exposure to equities and the possibility of investment returns, which generate a

high real rate of return in the long term while recognizing that there is a significant

probability of negative investment returns in the short term. This fund offers a

totally equity based investment option. Your returns depend entirely upon the

performance of the equity market. The risk profile of this fund is high. The higher

risk of this portfolio means that expected returns would also be higher.

Investment would not exceed 30% in bank deposits and may be up to 100% in

equities.

Value of Units:

The market value of assets plus/less expenses incurred


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In the purchase/sale of assets plus current assets

plus

Any accrued income net of fund management

charges

Less current liabilities less provision

Unit Value =

Total number of units on issue (before any new

units

are allocated/redeemed.)

Who can Buy the product

What is the policy term

Minimum policy term 5 years

Maximum policy term 40 years

Flexible premium payment modes:

Choose from five premium payment modes.a) Annual minimum premium is Rs. 10,000.

b) Half yearly minimum premium is Rs. 5,000.

c) Quarterly minimum premium is Rs. 2,500.

d) Monthly minimum premium is Rs. 1,000.

Minimum age at entry 30 days

Maximum age at entry 65 years

Maximum age at maturity 80 years


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e) Single premium minimum premium is Rs. 25,000.

Charges under the plan:

1. Premium allocation charge

For regular premium policies:

Term of the policy as below

Years 5-9 10 - 14 15+

First year 10% 15% 20%

Thereafter 5% 5% 5%

(The premium allocation charge for single premium & top ups is 2%.)

2. Policy Administration charges:

Rs. 40 will be deducted from your unit account each month.

3. Fund Management Charges:

(The fund management charges will be deducted on a daily basis.)

Revision of charges:

Unit Linked Funds Annual Rate

Capital Secure 1.50%

Balanced Fund 1.50%

Growth Fund 1.75%

Equity Fund 1.75%


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The fund management charges are subject to revision at any time, but hey will not

exceed 2% p.a. for the capital secure fund and 2.5% p.a. for the other funds.

Any changes made to the charges under this policy will be subject to IRDA

approval.

4. Partial Withdrawal Charges:

Rs. 100 per withdrawal will be deducted from your unit account.

5. Switching Charge:

1% of the amount switched, with a maximum of Rs. 1,000/- per switch.

6. Mortality Charges:

The Mortality charges, based on your attained age, are determined using 1/12 th of

the charges are different.

7. Surrender Charge:

This charge is levied on the unit fund at the time of surrender of the policy as

under:

8. Service Tax Charge

Number of years premiums

paid

Surrender charge as

percentage of fund value

Less than 1 100%

1 50%

2 20%3 and more NIL


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This charge will be levied on mortality, accident & disability benefit charges. The

level of this charge will be as per the rate of service tax on risk premium levied by

the government from time to time the correct rate of service tax is 12.36% this

charge shall be collected along with charges.

How safe is your investment

The investments made in the unit funds 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 the fund and the factors influencing the

capital market, and the insured is responsible for his/her decisions. The unit price is a reflection of the financial and equity/debt market

conditions and can increase or decrease at any time due to this.

Benefits payable under the policy will be made according o the tax laws and

other regulations in force at that time.

There are no guarantees for any fund of any kind under this policy. The

benefit payable on maturity will be equal to the value of your units.

The name in the funds in n way indicates the returns derived from them.

Please note that Reliance life Insurance company limited is only the name of

the insurance company and Reliance market return plan is only the name of

the unit linked life insurance policy and does not in anyway indicate the

quality of the policy or its future prospects or returns

Free Look Period.


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In case the policyholder disagrees with any of the terms and conditions of the

policy, he may return the policy to the company within 15 days of its receipt for

cancellation, stating his/her objections in which case the company will refund an

amount equal to the non allocated premium plus the charges levied by cancellation

of units plus fund value as on the date of receipt of the request in writing for

cancellation, less the proportionate premium for the period the company has been

on risk and the expenses incurred by the company medical examination and stamp

duty charges. If the risk acceptance date falls within cooling off period, then on

cancellation RLIC shall pay fund value less of charges.

The Concept of Mutual Fund


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A mutual fund is a common pool of money into which investors place their

contributions that are to be invested in accordance with a stated objective. The

ownership of the fund is thus joint and mutual; the fund belongs to all investors

Reliance Mutual Fund

Reliance Mutual Fund (RMF), a part of the Reliance - Anil Dhirubhai Ambani

Group, is India's leading Mutual Fund, with average Assets under Management of

Rs. 90,813 crores for the month of June 2008, and an investor base of over 6.7

million. Reliance Mutual Fund offers investors a well rounded portfolio of

products to meet varying investor requirements. Reliance Mutual Fund has apresence in 300 cities across the country and constantly endeavors to launch

innovative products and customer service initiatives to increase value to investors.

Reliance Mutual Fund schemes are managed by Reliance Capital Asset

Management Ltd., a wholly owned subsidiary of Reliance Capital Ltd.

Types of Mutual Funds on the Basis of Risk Vs Returns


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Frequently used term in Mutual Funds

Net Asset Value (NAV)

Net Asset Value is the market value of the assets of the scheme minus its

liabilities. The per unit NAV is the net asset value of the scheme divided by the

number of units outstanding on the Valuation Date.

Sale Price

Is the price you pay when you invest in a scheme. Also called Offer Price. It may

include a sales load.

Repurchase Price

Is the price at which a close-ended scheme repurchases its units and it may include

a back-end load. This is also called Bid Price

Sector Funds

Risk

Money Market Funds

Floaters

Income Funds

Gilt Funds

MIPs

Balanced Funds

Diversified Equity

Funds

Returns


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Redemption Price

Is the price at which open-ended schemes repurchase their units and close-ended

schemes redeem their units on maturity? Such prices are NAV related.

Sales Load

Is a charge collected by a scheme when it sells the units. Also called, Front-end

load. Schemes that do not charge a load are called No Load schemes

Repurchase or Back-end Load

Is a charge collected by a scheme when it buys back the units from the unit

holders.

Types of Reliance Mutual Funds

1. Reliance Growth Fund

2. Reliance Vision Fund

3. Reliance Banking Fund

4. Reliance Diversified Power Sector Fund

5. Reliance Pharma Fund

6. Reliance Media & Entertainment Fund

7. Reliance NRI Equity Fund

8. Reliance Equity opportunities Fund

9. Reliance Index Fund

10.Reliance Tax Saver (ELSS) Fund

11.Reliance Equity Fund

12.Reliance Long Term Equity Fund

13.Reliance Regular Saving Fund


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The key term in mutual funds

Dividend Policy: Dividend will be distributed from the available distributable

surplus after the deduction of the divided distribution surplus after the deduction of

the dividend distribution tax and the applicable surcharge, if any. The mutual fund

is not guaranteeing or assuring any dividend. Pease read the offer document for

details. Further payment of all the dividends shall be in compliance with SEBI

circular No. SEBI/IMD/CIR No. 1/64057/06 dated 4/4/06.

Applicable NAV : Sale of units by reliance mutual fund: in respect of valid

applications received up to 3 p.m. by the mutual fund alongwith a local cheque or a

demand draft payable at par at the place where the application is

received, the closing NAV of the day on which application is received shall be

applicable.

Repurchase including Switch-out: in respect of valid applications received upto 3

pm by the mutual fund, same days closing NAV shall be applicable. In respect of

valid applications received after 3 p.m. by the mutual fund, the closing NAV of the

next business day shall be applicable.

Daily net Asset Value(NAV) publication: the NAV will be declared on all

working days and will be published in 2 newspaper. NAV can also be viewed on

www.reliancemutualfund.com and www.amfiindia.com .

Tax Benefits to the mutual fund: Reliance Mutual Fund is a Mutual fund

registered with the securities & exchange board of India and hence the entire

income of the mutual fund will be exempt from income tax in accordance with the

provisions of section 10(23D) of the income tax act, 1961. The mutual fund will

receive all income without any deduction of tax at source under the provisions of

section 196(iv) of the act.
http://www.reliancemutualfund.com/http://www.amfiindia.com/http://www.reliancemutualfund.com/http://www.amfiindia.com/


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An exemption has been granted under the finance (No.2) act, 2004 to open ended

equity oriented mutual funds from paying distribution tax on income distributed

without any time limit, effective from 1 April 2004.

Securities transaction Tax:

Name of Transaction Payable by Rate of Tax

Purchase and sale of

equity shares or units of

equity oriented mutual

funds on a recognized

stock exchange on

delivery basis

Both purchaser as well

as seller

0.125%

Sale on stock exchange

of equity shares or units

of equity oriented

mutual funds on non-

delivery basis

Seller 0.025%

sale of derivatives

reorganized stock

exchange

Seller 0.017%

Sale of units of equity

oriented mutual funds

to the mutual fund

Seller 0.25%

There are two types of investment in Mutual Funds.

Lump Sum

Systematic Investment Plan(SIP)

.

Lump sum: In Lump sum the investment is only one times that


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is of Rs. 5,000. and if the investment is monthly then the investment will be

6,000/-.

Systematic Investment Plan(SIP) :

We have already mentioned about SIPs in brief in the previous pages but now

going into details, we will see how the power of compounding could benefit us. In

such case, every small amounts invested regularly can grow substantially. SIP

gives a clear picture of how an early and regular investment can help the investor

in wealth creation. Due to its unlimited advantages SIP could be redefined as a

methodology of fund investing regularly to benefit regularly from the stock market

volatility. In the later sections we will see how returns generated from some of the

SIPs have outperformed their benchmark. But before moving on to that lets have a

look at some of the top performing SIPs and their return for 1 year:

Scheme

Amoun

t NAV

NAV

Date

Total

Amount

Reliance diversified

power sector retail 1000 62.74 30/5/2008 14524.07

Reliance regular savings

equity 1000

22.20

8 30/5/2008 13584.944

principal global

opportunities fund 1000 18.86 30/5/2008 14247.728

DWS investment

opportunities fund 1000 35.31 30/5/2008 13791.157BOB growth fund 1000 42.14 30/5/2008 13769.152

In the above chart, we can see how if we start investing Rs.1000 per month then

what return well get for the total investment of Rs. 12000. There is reliance

diversified power sector retail giving the maximum returns of Rs. 2524.07 per year


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which comes to 21% roughly. Next we can see if anybody would have undertaken

the SIP in Principal would have got returns of app. 18%. We can see reliance

regular savings equity, DWS investment opportunities and BOB growth fund

giving returns of 13.20%, 14.92%, and 14.74% respectively which is greater than

any other monthly investment options. Thus we can easily make out how SIP is

beneficial for us. Its hassle free, it forces the investors to save and get them into

the habit of saving. Also paying a small amount of Rs. 1000 is easy and convenient

for them, thus putting no pressure on their pockets.

Now we will analyze some of the equity fund SIP s of Birla Sunlife with BSE 200

and bank fixed deposits In a tabular format as well as graphical.

Exposure of Mutual Funds Companies in India

The concept of mutual funds in India dates back to the year 1963. The era between

1963 and 1987 marked the existence of only one mutual fund company in India

with Rs. 67bn assets under management (AUM), by the end of its monopoly era,

the Unit Trust of India (UTI). By the end of the 80s decade, few other mutual fund

companies in India took their position in mutual fund market.

The new entries of mutual fund companies in India were SBI Mutual Fund,

Canbank Mutual Fund, Punjab National Bank Mutual Fund, Indian Bank Mutual

Fund, Bank of India Mutual Fund.

The succeeding decade showed a new horizon in Indian mutual fund industry. By

the end of 1993, the total AUM of the industry was Rs. 470.04 bn. The private

sector funds started penetrating the fund families. In the same year the first Mutual

Fund Regulations came into existence with re-registering all mutual funds except

UTI. The regulations were further given a revised shape in 1996.

Kothari Pioneer was the first private sector mutual fund company in India which

has now merged with Franklin Templeton. Just after ten years with private sector


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players penetration, the total assets rose up to Rs. 1218.05 bn. Today there are 33

mutual fund companies in India in which some are as below.

ABN AMRO Mutual Funds

Birla Sun life mutual Funds

Bank of Baroda Mutual Fund

HDFC Mutual Fund

HSBC Mutual Fund

ING Vysya Mutual Fund

Prudential ICICI Mutual Fund Sahara Mutual Fund

State Bank of India Mutual Fund

Tata Mutual Fund (TMF)

Kotak Mahindra Asset Management Company (KMAMC)

UTI Asset Management Company Private Limited

Reliance Mutual Fund (RMF)

Standard Chartered Mutual Fund

Escorts Mutual Fund

Alliance Capital Mutual Fund

Benchmark Mutual Fund

Canbank Mutual Fund

Chola Mutual Fund

LIC Mutual Fund

GIC Mutual Fund

Working of a Mutual Fund


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Terms and conditions This facility offered only to the investors having bank accounts in selected

cities which are specific in the form of the SIP.

Submit the following document at least 21 working days before the first SIP

date for ECS (Electronic clearing Service).

The first SIP cheque should be issued from the same bank account which is

to be debited under ECS for subsequent installments.

The bank account provided for ECS (Debit) should participate in local

MICR clearing.

SIP auto debit facility is available only on specific dates of the month i.e.

2nd or 10th or 18th or 28th.

The investor agrees to abide by the terms and conditions of ECS facility of

Reserve bank of India.

An investor can opt for monthly or quarterly frequency.

Only one SIP per month or per quarter is permitted per folio/account.


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Minimum investment amount monthly SIP option 60 installments of Rs.

100/- each or 12 installment or Rs. 500/- each or 6 installments of Rs. 1000/-

each and in multiples of Re.1/- thereafter.

The gap between the 1st cheque/ installment & the 2nd cheque / installment

should be at least 21working days. However subsequent cheques should

have a gap of at least a month or a quarter depending upon the frequency

chosen.

Advantages of Mutual Funds

Diversification: The best mutual funds design their portfolios so individual

investments will react differently to the same economic conditions. For

example, economic conditions like a rise in interest rates may cause certain

securities in a diversified portfolio to decrease in value. Other securities in

the portfolio will respond to the same economic conditions by increasing in

value. When a portfolio is balanced in this way, the value of the overall

portfolio should gradually increase over time, even if some securities lose

value.

Professional Management: Most mutual funds pay topflight professionals

to manage their investments. These managers decide what securities the fund

will buy and sell.

Regulatory oversight: Mutual funds are subject to many government

regulations that protect investors from fraud.

Liquidity: It's easy to get your money out of a mutual fund. Write a check,

make a call, and you've got the cash.


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Convenience: You can usually buy mutual fund shares by mail, phone, or

over the Internet.

Low cost: Mutual fund expenses are often no more than 1.5 percent of your

investment. Expenses for Index Funds are less than that, because index

funds are not actively managed. Instead, they automatically buy stock in

companies that are listed on a specific index

Transparency

Flexibility

Choice of schemes

Tax benefits

Well regulated

Drawbacks of Mutual Funds

Mutual funds have their drawbacks and may not be for everyone:

No Guarantees: No investment is risk free. If the entire stock market

declines in value, the value of mutual fund shares will go down as well, no

matter how balanced the portfolio. Investors encounter fewer risks when

they invest in mutual funds than when they buy and sell stocks on their own.

However, anyone who invests through a mutual fund runs the risk of losing

money.


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Fees and commissions: All funds charge administrative fees to cover their

day-to-day expenses. Some funds also charge, financial consultants, or

financial planners. Even if you don't use a broker or other financial adviser,

you will pay a sales commission if you buy shares in a Load Fund.

Taxes: During a typical year, most actively managed mutual funds sell

anywhere from 20 to 70 percent of the securities in their portfolios. If your

fund makes a profit on its sales, you will pay taxes on the income you

receive, even if you reinvest the money you made.

Management risk: When you invest in a mutual fund, you depend on the

fund's manager to make the right decisions regarding the fund's portfolio. If

the manager does not perform as well as you had hoped, you might not make

as much money on your investment as you expected. you invest in Index

Funds, you forego management risk, because these funds do not employ

managers

CHAPTER 3:-

Project Profile And Unit Linked Plans Of Reliance Capital

RESEARCH MEATHODOLOGY

o significancce of the study

o Objective And Scope Of The Study

o Hypothesis


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o Sample size and type

o Questionnaire

o Statistical tool

ULIP PLANS

1-RELIANCE AUTOMATIC INVESTMENT PLAN:-

Key Features Reliance Automatic Investment Plan

Two plan option to choose from ready- made and tailor- made.

Freedom to decide your own fund mix based on your risk

Profile under the tailor-made plane Regular ,limited , single premium paying option

Unmatched flexibility through our exchange option

Liquidity in the form of partial withdrawal

The Key Benifits Of Reliance Automatic Investment Plan Are As Follows

A smart plan which adapts to your changing risk profile with increasing

age.


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Option to lower the average cost of unit through systematic transfer of your

fund.

Flexibility to switch between fund and plan.

Option for additional insurance cover available through riders.

How Does This Plan Work

As a customer you have the liberty to choose between the ready made and

tailor-made plan option . The premium contributions made by you, net of

premium allocation charges and sum assured related charges are invested in

fund of your choose and unit are allocated depending on the price of unit for

the fund

The fund value is the total value of units that you hold in the fund. The

mortality charges and policy administration charges are deducted through

cancellation of units, whereas the fund management charge is priced in the

units value.

TAX BENIFITE


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As per current tax rules premium paid are eligible for tax deduction under

sec.80c of the income tax act,1961. Provided the premium in any years

during the term of the policy does not exceed 20% of the sum assured,

maturity and withdrawals are eligible for tax benefit under sec.10(10d).

Death benefits are tax free under sec.10(10)d of the income tax act,1961.

Under sec 80c premiums up to rs.100,000 are allowanced as deduction from

your taxable income.

who can buy this product ?

reliance automatic investment plan

Minimum age at entry: 18 years last birthday

Maximum age at entry: 59 years last birthday

Minimum age at vesting : 45 years last birthday

Maximum age at vesting : 64 years last birthday

Minimum policy term: 5 years or up to age 45 years, if

later

minimum sum assured : 5 times of the annualised

premium

Maximum sum assured : 50times of the annualised

premium


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2- RELIANCE SUPER INVESTASSURE PLAN

KEY FETURE RELIANCE INVESTASSURE PLAN

Twin benefits of marke linked return and insurance protection

Investment opportunity with flexibility choose from 8 pure investment

fund option

Option to pay top up premium's

Liquidity in the form of partial withdrawals


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A host of optional rider benefits to enhance protection cover

How does the reliance super investassure plan ?

As a customer you have the liberty to choose between 8 fund options the

premium contribution made by you, net of premium allocation charges ae

invested in fund of your choice. The units are allocated depending on the price

of units of the funds.

The fund value is the total value of units that u hold across all the unit-linked

funds.

Minimum Sun Assured: Annualized Premium Payable For 5 Years.

Maximum Sum Assured : Depends On The Age At Entry

age at entry (last birthday) maximum sum assured

0 to 40 20 times of annualized premium

41 to 45 15 times of annualized premium

46 to 50 10 times of annualized premium51 to 60 5 times of annualized premium


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BENEFITS

LIFE COVER BENEFITS

if death of the life assured occur before commencement of risk

cover#, total fund value as on the date of intimation of death will

be paid.

if death of the life assured occurs on or after 60 th birthday, the

higher of 1or 2 will be paid

1. sum assure( less all partial withdrawals made from the policy fund

during the 24 months before attaining 60th birthday withdrawals

made from the basic policy fund after attaining 60th birthday)

2. total fund value as the date of intimation of death.

MATURITY BENIFIT

on survival of the life assured to maturity, the total fund value will be paid.

the policy terminates on payment of maturity benefits .


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RIDER BENEFITS

you can add following optional rider benefits

reliance major surgical benefit rider

reliance critical conditions(25) rider

reliance term life insurance term benefits

reliance accidental death and total and permanent disablement rider

RESEARCH METHODOLOGY

Research Methodology deals with, the procedure adopted to carry out the study.

According to green and Tull:

A research design is the specification of methods and procedures acquiring the

information needed It is the overall operational pattern or framework of the project

that stipulates which information is to be collected from which sources by what

procedures. For conducting the study, the researcher has adopted both primary as

secondary method of data collection.


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Data sources:

Research is totally based on primary data. Secondary data can be used

only for the reference. Research has been done by primary data

collection, and primary data has been collected by interacting with

various people.

CHAPTER 5

DATA ANALYSIS & INTERPRETATION

Q 1. Do you make investments?

CATEGORY NO.OF PEOPLES %

YES 22 73

NO 8 27


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For conducting the study, the researcher has adopted both primary as secondary

method of data collection.There are 73% of the value of people stand with yes,and

then 23%of the people says no.

Q 2. What are the reasons to make investments?

OPTION PEOPLE %

TAX SAVING 7 23.33333

SECURE

INVESTMENT

6

20

LIFE COVER 9 30RETURN 5 16.66667

OTHER 3 10

0%

73%

27%

CATEGORY

YES

NO

23%

20%30%

17%10%

PEOPLE

TAX SAVING

SECURE INVESTMEN

LIFE COVER

RETURN

OTHER


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only for the reference. Research has been done by primary data collection,

and primary data.30%of them are with life cover.

3. Which companys policy you are having?

COMPANIES PEOPLE %

LIC 18 61

Reliance 4 8

Icici 3 7

OTHER 5 11


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and primary data 61% of the lic and the rest of the with the other people.

PEOPLE

61%8%

7%

11%

13%LIC

RelianceI

Icici

OTHER


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Q.4 Are you satisfied with your Investment?

CATEGORIES NO. OF PEPOLE %

YES 16 58

NO 14 42

NO. OF PEPOLE

58%

42%

N



and primary data and 58% stands with yes and 42% no.


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Q5. Have you heard about private insurance company reliance capital?


YES 16 58NO 14 42

NO. OF PEPOLE

58%

42%

N

Interpretatiom



and primary data and 58% stands with yes and 42% no.


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Q6. How did you come to know about the company.


ADVERTISEMENT 12 40

WORD OF MOUTH 8 29

YOUR BANK 3 7

INSURANCEAGENT

7 24


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NO. OF PEPOLE

40%

29%

7%

24%

ADVERTISEMEN

WORD OF MOUT

YOUR BANK

INSURANCE AG

Q7.what kind of plan do you have?

CATEGORIES NO.OF PEPOLE TOTAL%

ENDOWNMENT 6 19

TERM 4 11

ULIP 15 57

NO POLICY

HOLDER

5 13


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NO.OF PEPOLE

19%

11%

57%

13%

ENDOWNMENT

TERM

ULIP

NO POLICY HOLD

Q8 Are you satisfied with your Investment?

CATEGORIES NO. OF PEOPLE %

SATISFIED 16 56

UNSATISFIED 9 31

NO POLICY

HOLDER

5 13


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NO. OF PEOPLE

56%31%

13%

SATISFIED

UNSATISFIED

NO POLICY HOLD

Q9.Are you aware about the benefit and the condition about your plan?


COMPLETE

AWARE

8 23


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ADEQUATE AWARE 5 17

CONFUSE 2 13

LESS KNOWLEDGE 7 19

COMPLETE

UNAWARE

4 15

NO POLICY

HOLDER

2 13

NO. OF PEPOLE

23%

17%

13%19%

15%

13% COMPLETE AWARE

ADEQUATE AWARE

CONFUSE

LESS KNOWLEDGE

COMPLETE UNAWA

NO POLICY HOLDER

Q10 How much return you are expecting from your ULIP?


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CATEGORIOES NO OF PEPOLE %

15-25% 30 20

25-35% 32 2135-45% 28 19

MORE THAN 45% 40 27

NON POLICY

HOLDER

20 13

NO OF PEPOLE

20%

21%

19%

27%

13%15-25%

25-35%

35-45%

MORE THAN 45%

NON POLICY HOLD


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Q11 Do you know about the reliance automatic investment plan

of ULIP?

CATEGORIES NO.OF PEPOLE %YES 17 59

NO 13 41


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NO.OF PEPOLE

59%

41%

Y

N

Q12. Do you think reliance automatic investment plan

of reliance capital is better other plans?

CATEGORIES NO.OF PEPOLE %

YES 10 33

NO 7 26

DONT KNOW 13 41


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NO.OF PEPOLE

33%

26%

41%YES

NO

DONT KN

Q13. why did you purchase insurance plan?


FOR PROTECTION 4 15

FOR SAVING 6 21

FOR INVESTMENT 11 35FOR TAX SAVING 8 29


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NO. OF PEPOLE

15%

21%

35%

29%FOR PROTECTI

FOR SAVING

FOR INVESTME

FOR TAX SAVIN

Q14 Do you think ULIP is a risky investment?

CATEGORIES NO.OF PEPOLE %

VERY RISKY 4 13

MODERATE 5 18

SAFE 10 34

VERY SAFE 6 20

NON POLICY

HOLDER

7 15


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NO.OF PEPOLE

13%

18%

34%

20%

15%VERY RISKY

MODERATE

SAFE

VERY SAFE

NON POLICY HOLD

CHAPTER 6

FINDING / SUGGESTION

FINDINGS

Now people mainly prefer ULIP for saving, then bank

then Post-Office and after that prefer P.P.F. and other. The main reason

behind the insurance plan or ULIP preference is switching facility or

option to choose fund.

Mainly people prefer low growth safe return as compare

to high growth some risky return.


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People mainly purchase life insurance policy for

investment and then for tax-saving they give 2nd preference to

protection.

Approximately 20% people do not know what is

insurance.

I also find that people mainly prefer L.I.C. as compare to

private insurance company.

In my survey, I also find that only 56% people are

satisfied with current policy.

In also find that only 58% people know about the ICICI

Prudential Life Insurance.

SUGGESTION

Brand awarness about the reliance capitals ulip plans.

Company preferences should be considered.

After sales service should also be provided by the agents.

Different promotin schemes should be adopte by the company.

Ex- banners, holdings , road shows etc.

They should target rural market as well.


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CHAPTER 7

CONCLUSION

Our exhaustive research in the field of Life Insurance threw up some interesting

trends which can be seen in the above analysis. A general impression that we

gathered during Data collection was the immense awareness and knowledge

among people about various companies and their insurance products. People are


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beginning to look beyond LIC for their insu

RESEARCH REPORT Reliance Capital

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