Summer Training Report

On
Various Plan Offered By Reliance life Insurance
Submitted In
Partial Fulfillment Of the Requirement
Of Masters of Business Administration

Training Supervisor Submitted By:

Submitted To:
Banarsidas Chandiwala Institute of Professional Studies, Dwarka,
New Delhi
(Affiliated to Guru Gobind Singh Indraprastha University)

DECLARATION

1
 I hereby declare that this Project

Report titled VARIOUS PLANS OFFERED BY RELIANCE LIFE

INSURANCE COMPANY LIMITED submitted by me to Banarsidas Chandiwala

Institute of Professional Studies, Dwarka is a bonafide work undertaken during

the period from 24 MAY 2010 to 31 JULY 2010 by me and has not been

submitted to any other University or Institution for the award of any degree

diploma / certificate or published any time before.

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CERTIFICATE

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 ACKNOWLEDGEMENT

TABLE OF CONTENTS

1) ExecutiveSummary…………………………..........…………7

2) Introduction..............................................................................9
• About Insurance industry
• What is Life Insurance

4
• Life insurance v/s other
savings

3) Objective of Research Study...................................................16

4) Literature Review…………………….…………………........17

5) Company’s Profile………………………….………………...21

6) Corporate Objective……………………….………................23

7) Corporate Mission....................................................................24

8) Research Methodology…………………………………….....27
• Secondary data

9) ULIPS offered by Reliance life….……………………….......28

• Reliance Money Guarantee Plan
• Reliance Super Automatic Investment Plan
• Reliance Child Secured Plan
• Reliance Wealth + Health Plan
• Reliance Super Golden Years plan

10) Reliance money Guarantee Plan............................................29

• Features
• Working
• Benefits
• Flexibility
• Charges
• Tax benefit
• Term Life Insurance Benefit
• Free look period

11) Reliance Super Automatic Investment Plan……………......35

• Features
• Benefits
• Working
• Tax Benefit

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 12) Reliance Child Secured
Plan……………………….…….......38
• Features.
• Working
• Benefits
• Fund Options
• Flexibility
• Charges
• Exchange Option
• Tax Benefit
• Free look period

13) Reliance Wealth + Health Plan………………….…….............44

• Features
• Benefits
• Working
• Flexibility
• Charges
• Tax Benefits
• Free look period

14) Reliance Super Golden years plan...........................................49

15) Analysis……………………………………………………........58

16) Interpretation……………………………………………..........77

17) Findings and recommendations................................................79

18) Conclusion………………………………………………….......80

19) Bibliography…………………………………………………....82

EXECUTIVE SUMMARY

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In the bur going Indian economy
the service sector has emerged in a big way since the liberalization waves started
blowing in India since 1992 onwards .It was the astounding growth rate of
insurance sector which attracted me to explore and study this area. Life insurance
corporation of India plays a predominant role because of obvious reasons and
already lot of studies have been done on it, this research is to study the new
entrant in the field i.e. Reliance Life Insurance Company Ltd. for my project
work. The research includes the various products of RLI especially ULIPS.
Further the comparison has been made regarding ULIP products between
Reliance Life Insurance Company and ICICI prudential. This research has been
done basically to find out the differences between the products offered by both the
companies and to find out which one is better.

The objective of conducting this research is to study and analyze the various ulip
products of Reliance Life Insurance and further to have a detailed comparison of
the products of ICICI Prudential Life Insurance Co. Ltd.
For the research methodology, only secondary data has taken into consideration.
Now firstly, the research has covered the details of major ulip plans offered by
Reliance Life Insurance such as Super Automatic Investment Plan, Money
Guarantee Plan, Health + Wealth, Secure Child Plan & Super Golden Years Plan.
Secondly, the research has analyzed the comparison of products offered by both
the companies which includes the detail about the features of the products as well
their returns generated with in the time span of two previous financial years.

The overall analysis has been interpreted in following lines as stated,

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“Reliance Life Insurance ulip
products are a complete package for a customer which includes life insurance,
returns on money invested, tax benefit, flexibility to the customer to withdraw full
money after a certain period of time, also offers availability of partial
withdrawals, choice of portfolios to invest their money into different funds and
also provides ample of switches to exercise between the funds.”
The research also interpreted that the returns generated by ICICI Prudential are
better than the Reliance life insurance.
Finally the research has been concluded that despite of providing the above
mentioned features, Reliance life insurance need to improve their fund
management and provide more transparency to their customers in terms of
investment options & better portfolio management services. To establish a
position in the market Reliance life insurance need to work upon their policies,
they have to reframe their plans according to the need of the market.
The research also concludes the latest amendments made by the Insurance
Regulatory Development Authority which further makes the product more
customer friendly and emphasis the company to introduce more customer oriented
products as per the new guidelines set by them.

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 INTRODUCTION

The story of insurance is probably as old as the story of mankind.

The same instinct that prompts modern businessmen today to secure themselves
against loss and disaster existed in primitive men also. They too sought to avert
the evil consequences of fire and flood and loss of life and were willing to make
some sort of sacrifice in order to achieve security. Though the concept of
insurance is largely a development of the recent past, particularly after the
industrial era – past few centuries – yet its beginnings date back almost 6000
years. Life Insurance in its modern form came to India from England in the year
1818. Oriental Life Insurance Company started by Europeans in Calcutta was the
first life insurance company on Indian Soil. All the insurance companies
established during that period were brought up with the purpose of looking after
the needs of European community and Indian natives were not being insured by
these companies. However, later with the efforts of eminent people like Babu
Muttylal Seal, the foreign life insurance companies started insuring Indian lives.
But Indian lives were being treated as sub-standard lives and heavy extra
premiums were being charged on them. Bombay Mutual Life Assurance Society
heralded the birth of first Indian life insurance company in the year 1870, and
covered Indian lives at normal rates. Starting as Indian enterprise with highly
patriotic motives, insurance companies came into existence to carry the message
of insurance and social security through insurance to various sectors of society.
Bharat Insurance Company (1896) was also one of such companies inspired by
nationalism. The Swadeshi movement of 1905-1907 gave rise to more insurance
companies. The United India in Madras, National Indian and National Insurance
in Calcutta and the Co-operative Assurance at Lahore were established in 1906. In
1907, Hindustan Co-operative Insurance Company took its birth in one of the
rooms of the Jorasanko, house of the great poet Rabindranath Tagore, in Calcutta.
The Indian Mercantile, General Assurance and Swadeshi Life (later Bombay Life)

9
were some of the companies
established during the same period. Prior to 1912 India had no legislation to
regulate insurance business. In the year 1912, the Life Insurance Companies Act,
and the Provident Fund Act were passed. The Life Insurance Companies Act 1912
made it necessary that the premium rate tables and periodical valuations of
companies should be certified by an actuary. But the Act discriminated between
foreign and Indian companies on many accounts, putting the Indian companies at
a disadvantage. The first two decades of the twentieth century saw lot of growth
in insurance business. From 44 companies with total business-in-force as
Rs.22.44 crore, it rose to 176 companies with total business-in-force as Rs.298
crore in 1938. During the mushrooming of insurance companies many financially
unsound concerns were also floated which failed miserably. The Insurance Act
1938 was the first legislation governing not only life insurance but also non-life
insurance to provide strict state control over insurance business. The demand for
nationalization of life insurance industry was made repeatedly in the past but it
gathered momentum in 1944 when a bill to amend the Life Insurance Act 1938
was introduced in the Legislative Assembly. However, it was much later on the
19th of January 1956 that life insurance in India was nationalized. About 154
Indian insurance companies, 16 non-Indian companies and 75 provident were
operating in India at the time of nationalization. Nationalization was
accomplished in two stages; initially the management of the companies was taken
over by means of an Ordinance, and later, the ownership too by means of a
comprehensive bill. The Parliament of India passed the Life Insurance
Corporation Act on the 19th of June 1956, and the Life Insurance Corporation of
India was created on 1st September, 1956, with the objective of spreading life
insurance much more widely and in particular to the rural areas with a view to
reach all insurable persons in the country, providing them adequate financial
cover at a reasonable cost.

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 ABOUT INSURANCE INDUSTRY IN INDIA 2010

Insurance industry records a booming growth

The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has
projected a 500% increase in the size of current Indian insurance business from
US$ 10 billion to US$ 60 billion by 2010 particularly in view of contribution that
the rural and semi-urban insurance will make to it.
Rural and Semi-Urban Life Insurance business is expected to touch US$ 20
billion figure in next 4 years from current level of less than US$ 5 billion now as
rural and semi-urban folk will want themselves to ensure them for better future
and their rising purchasing power will motivate them to move towards insurance
sector.
In view of Assocham, the non-life insurance will rise to US$ 15 billion by 2010
from its negligible size now and in Urban areas, life insurance businesses are
anticipated to reach US$ 15 billion and that of non-life insurance US$ 10 billion,
according to Chamber Paper on Insurance Sector : Its Future Perspective.
Assocham has revealed that rural and semi-urban India shall contribute US $35
billion to the Indian insurance industry by 2010, including US $20 billion by way
of life insurance and the rest US $15 billion through non-life insurance schemes.
A large part of rural India is still untapped due to poor distribution, large distances
and high costs relative to returns. Urban sector insurance is estimated to reach US
$25 billion by 2010, life insurance US $15 billion and non-life insurance US $10
billion.
Estimating the potential of the Indian insurance market from the perspective of
macro-economic variables such as the ratio of premium to GDP, Assocham
Papers reveals that India’s life insurance premium, as a percentage of GDP is
1.8% against 5.2% in the US, 6.5% in the UK or 8% in South Korea.

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Assocham findings further
reveals that in the coming years the corporate segment, as a whole will not be a
big growth area for insurance companies. This is because penetration is already
good and companies receive good services. In both volumes

and profitability therefore, the scope for expansion is modest. Survey suggested
that insurer’s strategy should be to stimulate demand in areas that are currently
not served at all.
Insurance companies mostly focus on manufacturing sector, however, the services
sector is taking a large and growing share of India’s GDP. This offers immense
opportunities for expansion opportunities.
Being an agrarian economy again there are immense opportunities for the
insurance companies to provide the liability and risks associated in this sector.
The Paper found that the rural markets are still virgin territories to a great extent
and offer exciting opportunities for insurance companies. To understand the
prospects for insurance companies in rural India, it is very important to
understand the requirements of India's villagers, their daily lives, their peculiar
needs and their occupational structures. There are farmers, craftsmen, milkmen,
weavers, casual labourers, construction workers and shopkeepers and so on.
More often than not, they are into more than one profession.
The rural market offers tremendous growth opportunities for insurance companies
and insurers should develop viable and cost-effective distribution channels; build
consumer awareness and confidence. The Paper found that there are a total 124
million rural households. Nearly 20% of all farmers in rural India own a Kissan
Credit cards. The 25 million credit cards used till date offer a huge data base and
opportunity for insurance companies. An extensive rural agent network for sale of
insurance products could be established. The agent can play a major role in
creating awareness, motivating purchase and rendering insurance services. There
should be nothing to stop insurance companies from trying to pursue their own
unique policies and target whatever needs that they want to target in rural India.
Assocham suggests that insurance needs to be packaged in such a form that it

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appears as an acceptable investment to the rural people. In the near future, when
we’ll see more innovations in agriculture in the form of corporatization or a more
professional approach from the farmers’ side, insurance will definitely be one
option that the rural Indian is going to accept.

What Is Life Insurance?

Life insurance is a contract that pledges payment of an amount to the person

assured (or his nominee) on the happening of the event insured against.
The contract is valid for payment of the insured amount during:

• The date of maturity or Specified dates at periodic intervals or Unfortunate

death, if it occurs earlier.
• Among other things, the contract also provides for the payment of
premium periodically to the Corporation by the policyholder. Life
insurance is universally acknowledged to be an institution, which
eliminates 'risk', substituting certainty for uncertainty and comes to the
timely aid of the family in the unfortunate event of death of the
breadwinner.
• By and large, life insurance is civilization’s partial solution to the
problems caused by death. Life insurance, in short, is concerned with two
hazards that stand across the life-path of every person:

1) Dying prematurely leaving a dependent family to fend for itself.

2) Living till old age without visible means of support.

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 LIFE INSURANCE VS. OTHER SAVINGS

• Protection
Savings through life insurance guarantee full protection against risk of
death of the saver. Also, in case of demise, life insurance assures payment
of the entire amount assured (with bonuses wherever applicable) whereas
in other savings schemes, only the amount saved (with interest) is payable.

• Aid to thrift:

Life insurance encourages 'thrift'. It allows long-term savings since

payments can be made effortlessly because of the 'easy installment' facility
built into the scheme. (Premium payment for insurance is either monthly,
quarterly, half yearly or yearly).

For example: The Salary Saving Scheme popularly known as SSS,

provides a convenient method of paying premium each month by
deduction from one's salary.
In this case the employer directly pays the deducted premium to LIC. The
Salary Saving Scheme is ideal for any institution or establishment subject
to specified terms and conditions.

• Liquidity:
In case of insurance, it is easy to acquire loans on the sole security of any
policy that has acquired loan value. Besides, a life insurance policy is also
generally accepted as security, even for a commercial loan.

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 • Tax Relief:
Life Insurance is the best way to enjoy tax deductions on income tax and
wealth tax. This is available for amounts paid by way of premium for life
insurance subject to income tax rates in force.

Assesses can also avail of provisions in the law for tax relief. In such cases the
assured in effect pays a lower premium for insurance than otherwise.

Money When You Need It:

A policy that has a suitable insurance plan or a combination of different plans can
be effectively used to meet certain monetary needs that may arise from time-to-
time.
Children's education, start-in-life or marriage provision or even periodical needs
for cash over a stretch of time can be less stressful with the help of these policies.

Alternatively, policy money can be made available at the time of one's retirement
from service and used for any specific purpose, such as, purchase of a house or
for other investments. Also, loans are granted to policyholders for house building
or for purchase of flats (subject to certain conditions).

Who Can Buy A Policy?

• Any person who has attained majority and is eligible to enter into a valid
contract can insure himself/herself and those in whom he/she has insurable
interest.

• Policies can also be taken, subject to certain conditions, on the life of one's
spouse or children. While underwriting proposals, certain factors such as

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 the policyholder’s state of
health, the proponent's income and other relevant factors are considered by
the Corporation.

OBJECTIVE OF RESEARCH STUDY

The objective of research study can be categorized as:

1) PRIMARY OBJECTIVE: To understand and analyze the various

ulip plans offered by Reliance Life Insurance company
2) SECONDARY OBJECTIVE: To compare the various products offered
by Reliance life insurance Company with Icici prudential company with
respect to their features and returns generated.

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 LITERATURE REVIEW

The concept of insurance is believed to have emerged almost 4500 years ago in
the ancient land of Babylonia where traders used to bear risk of the carvan by
giving loans, which were later repaid with interest when the goods arrived safely.
The concept of insurance as we know today took shape in 1688 at a place called
Lloyd’s Coffee House in London where risk bearers used to meet to transact
business.
This coffee house became so popular that Lloyd’s became the one of the first
modern insurance companies by the end of the eighteenth century.
Marine insurance companies came into existence by the end of the eighteenth
century. These companies were empowered to write fire and life insurance as well
as marine. The Great Fire of London in 1966 caused huge loss of property and
life. With a view to providing fire insurance facilities, Dr. Nicholas Barbon set up
in 1967 the first fire insurance company known as the Fire office.

The early history of insurance in India can be traced back to the Vedas. The
Sanskrit term ‘Yogakshema’ (meaning well being), the name of Life Insurance
Corporation of India’s corporate headquarters, is found in the Rig Veda. The
Aryans practiced some form of ‘community insurance’ around 1000 BC.
Life insurance in its modern form came to India from England in 1818. The
Oriental Life Insurance Company was the first insurance company to be set up in
India to help the widows of European community. The insurance companies,
which came into existence between 1818 and 1869, treated Indian lives as
subnormal and charged an extra premium of 15 to 20 per cent.

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The first Indian insurance company, the Bombay Mutual Life Assurance Society,
came into existence in 1870 to cover Indian lives at normal rates.
The Insurance Act, 1938, the first comprehensive legislation governing both life
and non-life branches of insurance were enacted to provide strict state control
over insurance business. This amended insurance Act looked into investments,
expenditure and management of these companies.

By the mid- 1950s there were 154 Indian insurers, 16 foreign insurers, and 75
provident societies carrying on life insurance business in India. Insurance
business flourished and so did scams, irregularities and dubious investment
practices by scores of companies. As a result the government decided to
nationalize the life assurance business in India. The Life Insurance Corporation of
India (LIC) was set up in 1956. The nationalization of life insurance was followed
by general insurance in 1972.

Insurance may be described as a social device to reduce or eliminate risk of loss

to life and property. Insurance is a collective bearing of risk. Insurance is a
financial device to spread the risks and losses of few people among a large
number of people, as people prefer small fixed liability instead of big uncertain
and changing liability. Insurance can be defined as a “legal contract between two
parties whereby one party called insurer undertakes to pay a fixed amount of
money on the happening of a particular event, which may be certain or uncertain.”
The other party called insured pays in exchange a fixed sum known as premium.
Insurance is desired to safeguard oneself and one’s family against possible losses
on account of risks and perils. It provides financial compensation for the losses
suffered due to the happening of any unforeseen events.

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Insurance constitutes one of the
major segments of the financial market. Insurance services play predominant role
in the process of financial intermediary.

Today insurance industry is one of the most growing sectors in India. There is lot
of potential in the Indian Insurance Industry. There are many issues, which
require study. The scope of the study of insurance industry of India would be very
great as there are ongoing developments in the industry after the opening of the
sector.
The economy of a country is highly influenced by the Financial System of the
country. The Indian Financial System has been broadly divided into two
segments: the organized and the unorganized segments. An investor has a wide
array of investment avenues available. Economic well being in the long run
depends significantly on how wise the investments are.
In the present financial scenario where the economy is poised to grow approx. at
9% ,as stated by our finance minister P Chidambaram, and the present bulls run in
the capital market ,where lot of money is being pumped into the economy by FIIs,
and increasing disposable income with the generation next has created a problem
of investment because there is lot money on hand but they don’t know where to
invest as there is significantly less attractive return in the bank FD, PPF, KVP,
NSC, MIS, and other Post saving scheme. Uncertainties in share market and low
interest rate have left investors puzzled, i.e. to spend the money or save the
money. If they want to save the money then where can they save it so that they
can get better returns with flexibility, tax benefit and as well as capital
appreciation. So it is necessary for investor to find the answer and way of capital
growth with better return rather than uncertain share market and other low yield
investment avenues.
Insurance constitutes one of the major segments of the financial market. Insurance
services play predominant role in the process of financial intermediary. Today
insurance industry is one of the most growing sectors in India. There is lot of

19
potential in the Indian Insurance
Industry.

There are many issues, which require study. The scope of the study of insurance
industry of India would be very great as there are ongoing developments in the
industry after the opening of the sector.
The major issue right now is the hike in FDI (Foreign Direct Investment) limit
from 26% to 49% in the insurance sector. Government may in near future allow
49% FDI in Insurance. This would lead to more capital inflow by foreign
partners.
Another major issue is the effects on LIC after the entry of private players in the
market. Though market share of LIC has been affected, it has improved in terms
of efficiency.
There are number of other hot topics like penetration of Health Insurance, Rural
marketing of insurance, new distribution channels, new product ranges, insurance
brokers’ regulation, incentive scheme of development officers of LIC etc. So it
offers lot of scope for studying the insurance industry.
Right now the insurance industry has great opportunities in a country like India or
China which huge population.

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 COMPANY PROFILE OF RELIANCE LIFE INSURANCE
FOUNDER
Few men in history have made as dramatic a contribution to their country’s
economic fortunes as did the founder of Reliance, Sh. Dhirubhai H Ambani.
Fewer still have left behind a legacy that is more enduring and timeless.
As with all great pioneers, there is more than one unique way of describing the
true genius of Dhirubhai: The corporate visionary, the unmatched strategist, the
proud patriot, the leader of men, the architect of India’s capital markets, the
champion of shareholder interest. But the role Dhirubhai cherished most was
perhaps that of India’s greatest wealth creator. In one lifetime, he built, starting
from the proverbial scratch, India’s largest private sector enterprise. When
Dhirubhai embarked on his first business venture, he had a seed capital of barely
US$ 300 (around Rs 14,000). Over the next three and a half decades, he converted
this fledgling enterprise into a Rs.60,000 crores colossus—an achievement which
earned Reliance a place on the global Fortune 500 list, the first ever Indian private
company to do so. Dhirubhai is widely regarded as the father of India’s capital
markets. In 1977, when Reliance Textile Industries Limited first went public, the
Indian stock market was a place patronized by a small club of elite investors
which dabbled in a handful of stocks. Undaunted, Dhirubhai managed to convince
a large number of first-time retail investors to participate in the unfolding
Reliance story and put their hard-earned money in the Reliance Textile IPO,
promising them, in exchange for their trust, substantial return on their
investments. It was to be the start of one of great stories of mutual respect and
reciprocal gain in the Indian markets. Under Dhirubhai’s extraordinary vision and
leadership, Reliance scripted one of the greatest growth stories in corporate

21
history anywhere in the world,
and went on to become India’s largest private sector enterprise. Through out this
amazing journey, Dhirubhai always kept the interests of the ordinary shareholder
uppermost in mind.

ABOUT RELIANCE

Reliance Life Insurance Company Limited is a part of Reliance Capital Ltd. of the
Reliance - Anil Dhirubhai Ambani Group. Reliance Capital is one of India’s
leading private sector financial services companies, and ranks among the top 3
private sector financial services and banking companies, in terms of net worth.
Reliance Capital has interests in asset management and mutual funds, stock
broking, life and general insurance, proprietary investments, private equity and
other activities in financial services.
Reliance Capital Limited (RCL) is a Non-Banking Financial Company (NBFC)
registered with the Reserve Bank of India under section 45-IA of the Reserve
Bank of India Act, 1934.
Reliance Capital sees immense potential in the rapidly growing financial services
sector in India and aims to become a dominant player in this industry and offer
fully integrated financial services.
Reliance Life Insurance is another step forward for Reliance Capital Limited to
offer need based Life Insurance solutions to individuals and Corporates.

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 CORPORATE OBJECTIVE

Reliance Life Insurance strongly believes that as life is different at every stage,
life insurance must offer flexibility and choice to go with that stage. They are
fully prepared and committed to guide their customers on insurance products and
services through their well-trained advisors, backed by competent marketing and
customer services, in the best possible way.

Aim to become one of the top private life insurance companies in India and to
become a cornerstone of RLI integrated financial services business in India.

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 CORPORATE MISSION

“To set the standard in helping our customers manage their financial future”.

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 SWOT ANALYSIS

STRENGTHS:
1) Reliance Life Insurance Company Limited is the part of the Reliance Capital
which is already an established brand name so its brand name can be used to sell
the products easily.
2) It offers a wide range of products catering to the needs and requirement of the
customer. So it is has the ability to adapt the changes.
3) Reliance has a long and strong history of solvency, financial stability.
4) It has dedicated Employees.
5) It has well efficient management.
6) It has a strong IT base which plays an important role in today’s scenario.

WEAKNESSES:
1) Newly established company, so people seems it risky. It has covered a span of
4 years.
2) Lack of efficient, skilled staff.
3) Lack of advertisement, so most of the customers are not aware of the Reliance
Life Insurance.

OPPORTUNITY:
1) There is a vast untapped market in India. The life insurance penetration in India
is approximately 2.5%. So it has large potential which can be harness.

25
2) Since Indian economy is a fast
growing economy which provides a lot of opportunity in this sector.

3) Since it has been observed that there is high growth of ULIP industry which
can be catered to.
4) There is less coverage in rural areas which can be covered.

THREATS:
1) The main threat is from the other players who have captured the greater market
share like LIC, ICICI Prudential.
2) IRDA has put a restriction on the policies offered by the company, although it
is a threat for the whole insurance industry.

26
 RESEARCH METHODOLOGY
As this is an exploratory research, therefore the data which has been used for
conducting research is only secondary data.
Secondary data is data that is neither collected directly by the user nor specifically
for the user, often under conditions not known to the user.
Examples include- Government reports.
Secondary information has already been collected for some other purposes. It may
be available from internal sources, or may have been collected and published by
another organization. Secondary data is cheaper and more quickly available than
primary data, but likely to need processing before it is useful.
Some are the sources of secondary data:
•Published reports
•Government statistics
•Scientific and technical Abstracts
•Company’s financial statements
•Company’s website
Secondary source of data has been collected and used in project making.
The research has made use of the information available on the company’s website
as well as the pamphlets of various ULIP plans of company.

27
 ULIP PLANS OFFERED BY RELIANCE LIFE INSURANCE

1) Reliance Money Guarantee Plan

2) Reliance Super Automatic Investment Plan

3) Reliance Child Secured Plan

4) Reliance Wealth + Health Plan

5) Reliance Super Golden Years Plan

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 Reliance Money Guarantee Plan

Reliance Money Guarantee Plan is a Unit Linked product addressing

comprehensive need to strike that perfect balance of Protection and Savings that a
customer deserve as he grow successfully. The Reliance Money Guarantee Plan is
a Regular Premium Unit Linked Policy which guarantees the entire premium
(including premiums for top- ups) paid by you. This is a plan which helps a
customer to reap all the benefits of a rising market simultaneously protecting him
from the downside risk of the market.

• Key Features

1) The sum of all premiums paid is guaranteed on maturity or on death

before the maturity.
2) Unique Return Shield feature to protect your returns
3) Choice to invest in 3 investment fund options

4) Liquidity in the form of partial withdrawals from top-up fund.

• The work procedure of the plan

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The premium contributed by a
customer net of Premium Allocation Charges and Miscellaneous Charge is
invested in fund option of his choice for a specified period of time as selected by
him and units are allocated depending on the price of units for the fund/funds. The
Fund Value is the total value of units that he hold in the fund. The Policy has a
minimum Guaranteed Fund Value which is equal to total of all premiums paid
(excluding any additional and extra premiums if any), to be payable on survival to
maturity or earlier death. The amount of top-up

premiums paid is also guaranteed on death provided there is no partial

withdrawal. The amount of top-ups premium is guaranteed on maturity provided
the top-ups premium was paid at least 10 years before the date of maturity and
there is no partial withdrawal. The Sum Assured under the Policy is fixed on the
basis of the selected annual premium and Policy Term.
The Mortality Charges and Policy Administration Charges are deducted through
cancellation of units whereas the Fund Management Charge is priced in the Unit
Value. The premiums for riders, if selected, are payable over and above the
premium for the basic Policy.

• Benefits

1) Capital Guarantee

2) Life Cover Benefit

3) Sum Assured

30
• Flexibility

1) Return Shield an innovative way to protect your returns

2) Pay top-ups

3) Switching Option

4) Premium Redirection

5) Convenient Premium Paying options

Reliance Money Guarantee Plan at a glance

Basic Plan Minimum Maximum
Age at Entry 30 days 55 years last birthday

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 18 years
Age at Maturity
last birthday 80 years last birthday
Policy Term 10 years 30 years
Optional Riders
Term Life Insurance Benefit Rider
Age at Entry 18 years last birthday 59 years last birthday
Age at Maturity 23 years last birthday 64 years last birthday
Policy Term 5 years 30 years
Sum Assured 25,000 Up to basic Policy Sum Assured
Accidental Death and Accidental Total and Permanent Disablement Rider
Age at Entry 18 years last birthday 60 years last birthday
Age at Maturity 23 years last birthday 64 years last birthday
Policy Term 5 years 30 years
Sum Assured 25,000 Up to basic policy Sum Assured
subject to a maximum of Rs
50,00,000 on accidental death
and Rs 500,000 per annum on
total permanent disability.

Charges under the plan

1. Premium Allocation Charges:

32
This is a percentage of the
premium appropriated towards charges from the premium received.
Premium Allocation Charge
Year
( as percentage of premium amount)
Year 1 20%
Year 2 5%
Year 3 to 5 3%
Year 6 to 8 2%
th
9 year onwards 1%
For top-up premium the Allocation Charge is 2%.
2. Policy Administration Charges:
Rs 40 will be deducted per month per Policy (charged monthly through
cancellation of units).
3. Switching Charge:
First four switches in any Policy Year are free. There will be a charge of Rs100
per switch on subsequent switches.
4. Surrender Charge:
This charge is levied on the Fund Value at the time of surrender of the Policy as
under:
Year of Surrender of Surrender Charge as
Basic Plan/top-ups a percentage of fund value
1 to 3 Not allowed
4 20%
5 10%
6 onwards Nil

33
5. Service Tax & other applicable charges:
These charges are to be levied on the Mortality Charge and on Rider Premiums.
The level of this charge will be as per the rate of Service Tax along with the other
applicable taxes/ charges on risk premium, if any, as declared by the Government
from time to time. The current rate of Service Tax (including the Education Cess
on Service Tax) on risk premium is 12.24%. Currently, this charge is borne by the
Company. However, the Company reserves the right to pass on this charge as well
as other charges/taxes to the Policyholder in future.
6. Miscellaneous Charge:
Fixed Miscellaneous Charge of Rs 2 per Rs 1000 Sum Assured will be collected
on inception of the Policy.

• Tax Benefit

As per current tax rules premiums paid are eligible for tax deduction under
Section 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 Section 10(10D). Death Benefit
are tax free under Section 10(10) D of the Income Tax Act, 1961. Under Section
80C premiums up to Rs 100,000 are allowed as deduction from your taxable
income.

• Term Life Insurance Benefit

Customer have the option of taking or removing the Term Life Insurance Benefit
Rider at any time during the term of the Policy subject to Medical and Financial
Underwriting provided the criteria in respect of minimum and maximum age at
entry, Policy Term, Premium Payment Term, Sum. Assured are satisfied.

34
The maximum Sum Assured under Term Life Insurance Benefit Rider will be
equal to the Sum Assured under Basic Plan.

• 15 day free look period

A customer is entitled to a free-look period of 15 days. If at the end of this time,

he do not wish to continue this Policy, then he may request us in writing to cancel
this Policy by returning it to the Company. The Company will refund the
premium paid by him after deducting a proportionate premium for the cover the
company provided to the customer during that time. Company will also deduct
any medical examination costs and Stamp Duty Charges incurred by the company
in respect of the Policy.

35
 Reliance Super Automatic Investment Plan

Automatic investment plan- The plan that automatically directs an investment and
yield returns like a money plant.

• Features

1) Two plan options to choose from Ready-made and Tailor-made

2) Life Stage asset allocation to ensure automatic change in investment
patterns, under the Ready-made Plan option

3) Freedom to decide a customer’s own fund mix based on his risk profile
under the Tailor-made Plan
4) Regular, limited, single premium paying options

5) Unmatched flexibility through company’s ‘Exchange Option’

6) Liquidity in the form of partial withdrawal
7) Option to avail of Accidental Death Benefit, Accidental Total and
Premium Disability.

• Benefits

1) A smart plan which adapts to changing risk profile with increasing age

2) Option to lower the average cost of units through systematic transfer of

funds
3) Flexibility to switch between funds and plans

36
 4) Options for additional
Insurance cover available through riders

• The work procedure of the plan

A customer have the liberty to choose between the Ready-made and Tailor-made
Plan options. The premium contributions made by him, net of Premium
Allocation Charges and Sum Assured Related Charges are invested in fund/funds
of his 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 a customer hold in the fund/ funds.
The Mortality Charges and Policy Administration Charges are deducted through
cancellation of units, whereas the Fund Management Charge is priced in the Unit
Value.

Reliance Super Automatic Investment Plan at a glance

Basic Plan Minimum Maximum

Age at Entry 30 days 65 years last
birthday

Age at 18 years last birthday 80 years last

Maturity birthday

Premium 5 years 30 years

Paying Term

37
Min Sum Regular /
Assured Limited Premium: Annualised Premium for 5 years or
Annualised Premium for half of the policy term, whichever
higher

Single Premium 125% of the single premium amount

Max Sum No Limit
Assured

Benefit Illustration

Age of the customer 30 35 40 45

Annual Premium Paid 25,000 25,000 25,000 25,000
Policy Term 15 15 15 15
Premium Paying Term 15 15 15 15
Sum Assured 1,87,500 1,87,500 1,87,500 1,87,500
Maturity Values:
at 6% investment return 4,95,104 4,94,413 4,93,017 4,90,506
at 10% investment return 6,94,534 6,93,530 6,91,444 6,87,755

Minimum Premium

Yearly Half Yearly Quarterly Monthly

Regular Premium option Rs 10,000 Rs 5,000 Rs 2,500 Rs 1,000
Limited Premium Rs 20,000 Rs 10,000 Rs 5,000 Rs 2,000
Single Premium Rs 25,000
Min Top Up amount Rs 2,500

• Tax Benefit

As per current tax rules premiums paid are eligible for tax deduction under
Section 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

38
 and withdrawals are eligible for
tax benefit under Section 10(10D). Death benefits are tax free under Section
10(10) D of the Income Tax Act, 1961. Under Section 80C premiums up to Rs
100,000 are allowed as deduction from your taxable income.

Reliance Secure Child Plan

Reliance Secure Child Plan – A unique life insurance cum savings plan. Start
saving from now and secure the future of your child.

• Features

1) Insurance cover on the life of child

2) Money at critical milestones in child’s career path - college education,

higher education, marriage

3) Child is completely protected – company will continue to pay the

premiums even if customer is not alive
4) Life time income to child in the event of disability

5) Return Shield option to protect investment returns

6) Liquidity in the form of partial withdrawals

7) Capital guarantee available on maturity and on death of the child for basic
and top-up premiums

• The work procedure of the plan

39
This is a non profit unit linked endowment plan where the life insured is the child
with premium waiver benefit on death of the proposer (father or mother).
The premium contributed by a customer net of Premium Allocation Charges and
Miscellaneous charges is invested in fund option of his choice for a specified
period of time as selected by him and units are allocated depending on the price of
units for the fund/funds. The Fund Value is the total value of units that customer
hold in the fund/funds. The policy has a minimum guaranteed fund value which is
equal to 95% of total Premiums paid under the basic plan less extra or additional
premiums if any provided no partial withdrawals were made from any of the
funds except redemption of points from e-Account for availing of services of web

based community and that the Equity fund was never selected up to the date of
death. The sum assured under the policy is fixed on the basis of the selected
annual Premium and policy term.
The allocation charges and miscellaneous charges are deducted from the
Premiums before allocation of units.
The mortality charges (along with the service tax on mortality), charges for total
and permanent disability due to accident and policy administration charges are
deducted through cancellation of units whereas the fund management charge is
priced in the unit value. The Premiums for riders, if selected, are payable over and
above the Premium for the basic policy.

• Benefits

1) Capital Guarantee

2) Commencement of risk cover

40
 3) Life Cover Benefit

• The different fund options

A. Funds available in respect of basic plan and top-up premium:

The plan offers three funds for basic plan and top-up contributions namely: Fund
G, Fund H and Equity Fund. A customer has the option to decide his own fund
mix with respect to premiums under the basic plan and top-ups.
B. Funds available in respect of Return Shield Option:
Return Shield Fund will be available if Return Shield Option is selected. The
returns earned under the basic plan and top-up contributions will be transferred to
Return Shield Fund if Return Shield option is selected.

• Flexibility

a) Return Shield
b) Partial Withdrawals
c) Pay top-ups
d) Switching Option
f) Convenient Premium paying options

• Charges Available under the plan

1) Premium Allocation Charges:

41
This is a percentage of the
Premium appropriated towards charges from the Premium received. It is deducted
from the premium as and when the Premium is received.
The initial allocation charge varies by the amount of the premium paid.
The rates are given below
Initial allocation charge- 25% of the premium in the first year
Year Renewal allocation charge
as % of annualized premium
2nd year 5%
3rd year and 4th year 3%
th th
5 year to 10 year 2.50%

The allocation charge on the single premium and top-ups will be at the rate of 3%
of the single premium / top-up amount.

2. Policy Administration Charges:

A monthly administration charge will be deducted by canceling units in advance
at the beginning of each monthly anniversary of the policy.
Premium Payment Term Administration charge (Rs. per month)
Regular Premium Policies 40
Limited Premium Policies 40
(during premium payment term)
Limited Premium Policies 35
(after premium payment term)

42
Single Premium
35

3. Fund Management Charges:

The fund management charges under each fund are given below:
Fund Name Annual Rate
Fund G 1.30% p.a.
Fund H 1.30% p.a.
New Fund I( New return shield fund) 1.25% p.a.
New equity fund, new pure equity fund, 1.35% p.a.
infrastructure fund, energy fund, madcap
fund

4. Switching Charge:
First four switches in any policy year are free. There will be a charge of Rs.100
per switch on subsequent switches.

5. Mortality Charge:
The Mortality Charges are based on customer attained age, are determined using
1/12th of the charges mentioned in the Mortality Charge table below and are
deducted by canceling the units from his fund every month.

6. Surrender charge/Partial withdrawal charge:

This charge is levied on the Fund Value at the time of surrender of the Policy as
under:

Year Of Surrender/ partial Surrender Charge/ Partial Withdrawal Charge as a percentage

withdrawal of Fund Value Being Surrendered/partially Withdrawn In Case
of Regular Premium Policies
1 to 3 20%

43
4
20%
5 10%
6 onwards Nil

7. Service Tax & other applicable charges:

These charges are to be levied on the Mortality charge. The level of this charge
will be as per the rate of Service Tax along with the other applicable taxes/charges
on risk premium, if any, as declared by the Government from time to time. The
current rate of service tax (including the education cess on service tax) on risk
premium is 12.36%.

• Exchange Option

This option is available for existing policyholders after completion of three policy
years from the date of commencement. Under this option, the policy holder can
transfer policy benefits (surrender, maturity etc.) either fully or partially to
another plan wherein exchange option is available.

• Tax Benefit

As per current tax rules premiums paid are eligible for tax deduction under
Section 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

44
Assured, maturity and withdrawals are eligible for tax benefit under Section
10(10D). Death benefits are tax free under Section 10(10D) of the Income Tax
Act, 1961. Under Section 80C premiums up to Rs. 100,000 are allowed as
deduction from your taxable income.

• 15 day free look period

In Case the Policy Holder 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 on medical
examination and stamp duty charges.

Reliance Wealth + Health Plan

Reliance Wealth + Health Plan, a health insurance plan underwritten by Reliance

Life Insurance Company Limited (Reliance Life), is designed to work in
conjunction with contributions towards Savings. The uniqueness of this plan is
that it not only provides benefits for covered injuries but also for other injuries by
encashment from the unit Fund. This plan from Reliance Life offers the
Hospitalization and Surgical Benefits and also covers Critical Illnesses. In short
this plan provides a customer with a quality Health cover that fits his Life Style.

45
 • Features

1) A Unit Linked plan with Unique Savings Component

2) Twin benefit of market linked return and health protection
3) Flexibility to take care of customer family’s health
4) Option to pay Top-ups

• Benefits

1) A comprehensive health plan that

- helps a customer to pay the routine medical expenses
- covers multiple major surgeries
- takes care of the follow-up tests and medicines post hospitalization.

2) Fund option including Equity fund to harvest the best from the growing Equity
market.

3) Income tax benefit under section 80C, 80 D and 10(10D) of the Income Tax
will be available.

• The work procedure of the plan

This is a non profit unit linked health plan where there can be multiple
lives insured. The principal insured is the policyholder and the other
insured person(s) are the family member(s). The family consists of the
Principal Insured (Policyholder), the Spouse as Insured Spouse and the
first two eligible children by seniority in age. The plan takes care of the
hospitalization expenses which include:
1) Daily Hospitalization expenses
2) Intensive Care Unit expenses

46
 3) Post Hospitalization
expenses in the form recuperation benefits

The premium contributed by customer net of Premium Allocation Charges and

Miscellaneous charges is invested in fund option of his choice for a specified
period of time as selected by him and units are allocated depending on the price of
units for the fund/funds. The Fund Value is the total value of units that he hold in
the fund/funds.

The allocation charges are deducted from the premiums before allocation of units.
The insurance charges (along with the service charge), are deducted through
cancellation of units whereas the fund management charge is priced in the unit
value. The premiums for riders, if selected, are payable over and above the
premium for the basic policy.

• Flexibility

1) Partial Withdrawals
47
 2) Pay top-ups.

3) Switching Option

4) Premium Redirection

5) Premium paying options

Reliance Wealth + Health Plan at a glance:

Basic Plan Minimum Maximum

Age at Entry of the 3 month(Completed) 19 years last birthday
Child
Age at Entry of the 18 years last birthday 55 years last birthday
Principal Insured /
Spouse
Age at Maturity of the - 20 years last birthday
Child
Age at - 65 years last birthday
Maturity/Benefit
ceasing age of the
Principal Insured /
Spouse
Policy Term (in 10 years 25 years
multiples of 5 years)

48
 • Charges under this plan

1. Allocation charges:
These are deducted from the savings premiums as they are paid and are as
follows:
Year Allocation charge as a % of
Annualised Premium
1 25%
2 year onwards 5%

2. Hospitalization charges:
This charge will apply for all Lives from inception. These hospitalization charges
will be deducted on a monthly basis on the beginning of first day of each policy
month using 1/12th of the Hospital Cash Benefit rates.
3. Policy administration charge:
A monthly administration charge of Rs.40 will be deducted by canceling of units
in advance at the beginning of the month.
4. Switching charge:
There are 52 free switches during any policy year. Subsequent switches if any will
have a fixed charge of Rs.100 per switch.

49
5. Fund management charge:

Fund Name Annual Rate

Money Market Fund 1.25% p.a.
Gilt Fund 1.25% p.a.
Corporate Bond Fund 1.25% p.a.
Equity Fund 1.50% p.a.

6. Service Tax Charge:

This charge (along with education cess) will be levied on the morbidity charges.
The level of this charge will be as per the rate of Service Tax on risk premium,
declared by the Government from time to time. The current rate of service tax
(including education cess) on risk premium is 12.36%.

• Tax Benefit

Benefits and premiums payable under the policy are subject to tax laws
and other financial enactments as they may exist from time to time.

As per current tax rules premiums paid in respect of hospitalization charges

are eligible for tax deduction under section 80 D of the Income Tax Act,
1961( the Act). The balance of premium is eligible to tax deduction under
section 80 C of the Act, provided the annual premium during the year does not
exceed 20% of the Sum Assured.

50
 • 15 day free look period

In Case the Policy Holder 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 on medical examination and stamp duty charges.

RELIANCE SUPER GOLDEN YEARS PLAN

Retirement means different things to different people, while some want to relax
and take a trip around the world, some want to start up a venture of their own, and
pursue a dream harnessed for years. The power to make your autumn years
special lies only with customer. The Reliance Life Traditional Golden Years Plan
gives him the power and the right kind of solution - A retirement plan that allows
a customer to save systematically and generate the much-needed corpus to make
his old age years look golden.

Under this plan the investment risk in the investment portfolio is borne by
the policyholder.

Key Features
- Non linked non- profit plan
- Addition of Accumulation Rate at the of every calendar month - Rate for
FY 2010-11: 7.75% p.a.

51
- Flexibility to increase
your savings any time by paying additional premium.
- Tax free commutation up to one third of benefits at Vesting Age.

• The work procedure of Reliance Life Traditional Golden Years Plan

The plan works in two parts - the Accumulation Period (i.e. the Policy Term) and
the Distribution Period (i.e. after the Vesting Date). The Accumulation Period is
the time when a customer builds his Account values through premium payment.
He pay premium every year for the entire term and get accumulated value which
will be maintained in a separate account called 'Accumulation Account' in respect
of each policyholder, which will be credited with accumulation rate at the end of
every calendar month.

The accumulation rate shall be applied proportionately to any increase in the

Account values. An additional accumulation account will be maintained
for any additional premiums paid.
After the Vesting Date, the Annuity Payments begins. Vesting Date means the
date from which the pension will start.

• Plan at glance
Minimum Maximum
Age at Entry 18yrs last b’day 75yrs b’day
Maximum Vesting 85yrs last birthday
Age
Minimum Policy Term [10 or up to age 45 years, whichever is higher]in
years
Base Premium Yearly-10,000 No Limit

Half-Yearl-5000

Quarterly-2500

52
 Monthly-1000
Additional Premium Rs.1000/- Per No limit. However the
Installment total of additional
premiums at any point
of time shall not exceed
50% of the total base
plan premium paid
till that time

• An Accumulation Account

Accumulation Account is a separate account specially maintained for a customer.

All the premiums he pay will be credited in the Accumulation Account after
deducting the Allocation fees for the relevant year.
The rate of allocation fees under the plan is stated below.

Year Allocation Fee as percentage

of annualised premium
Year 1 7.5%
Year 2 to 10 5%
Year 11 onwards 1%
Single premiums 2%

The rate of allocation fees under additional premiums will be 2% of the

additional premiums. In addition to the premiums, his accumulation Account will
be credited with accumulation Rate. The accumulation Rate will be declared in
advance at the start of every financial year.
However this will be added to customer’s account pro-rata at the end of every
calendar month.

53
While there is no upper limit on
the accumulation Rate that will be declared from year to year, the company
undertakes that the accumulation Rate to be declared in future will not be less
than the Savings Bank deposit interest rate declared by the Reserve Bank of India
(RBI).
The accumulation Rate for the FY 2010-11 will be 7.75% p.a. annually, declared
accumulation rate would be available on our website www.reliancelife.com
Once the accumulation rate is declared and credited to the accumulation account
and additional accumulation account, it will be guaranteed for the rest of the
policy term. After adding the accumulation Rate to customer’s account, company
shall deduct account administration fees of 1.25% p.a. of the account value, at the

end of every calendar month. There shall be monthly deductions of Policy

administration Fee of Rs 40 per month from customer accumulation account.

An Additional Accumulation Account

Any additional premium that a customer pay over and above the regular premium
will be credited into this account after deducting the allocation fees of 2% of the
additional premiums paid.
At the end of every calendar month, the additional accumulation Account will be
credited with the accumulation rate on pro-rata basis. The accumulation Rate on
additional accumulation account will be at the same level as the rate declared on
the accumulation account.
After addition of the accumulation rate, account administration fees of 1.25% p.a.
will be deducted from the additional accumulation account, at the end of every
calendar month. There will not be any further deductions from the additional
accumulation account.
A company shall accept the additional premiums as long as all the due premiums
under the base policy are paid.

54
 • Benefits a customer can avail in this policy

At Vesting:
1. On vesting, a customer can purchase annuity plan for the total of balances
in the accumulation account and additional accumulation account, if any.
2. Customer may commute up to one third of benefit as tax free lump sum
and the balance can be used for the purchase of annuity
3. Open Market Option: customer can purchase an annuity either from
Reliance Life Insurance Company Limited or from any other registered Life
Insurance Company.

At Death: In the unfortunate event of death during the Policy term, the beneficiary
will get the total of balances in the accumulation account and additional
accumulation account, if any as on intimation of death and will be paid in full.
The policy terminates on payment of death benefit.

• Grace Period for payment of premiums

There is a grace period of 30 days from the due date for payment of regular
premiums. In case of monthly mode, the grace period is of 15 days.

• Surrender the Basic Policy (Accumulation Account)

The policy will acquire a surrender value after two full years' premiums have been
paid. The surrender value will be available after completion of two complete
policy years.
Whenever full surrender value of the basic plan is paid, the surrender value of any
additional premium will also be paid without any deductions.

55
Once a policy is surrendered, it
cannot be reinstated. The Policyholder may take the full surrender value in cash or
may purchase an annuity with the surrender proceeds the surrender value will
depend on the number of premiums paid and the year of surrender.
Surrender Value on accumulation account under the base policy is stated below:
Year of Surrender Surrender Value (provided two full
years premiums have been paid) as a %
of
Accumulation Account
First 3 years Surrender not allowed
4th policy year 80%
5th policy year 90%
6th and subsequent policy year 100%

• Surrender the Additional Accumulation Account

A full surrender can be done on the additional accumulation account. The full
surrender value will be available in respect of on Additional Accumulation
Account. Surrender value will be the balance in Additional Accumulation
Account on the date of surrender. On full partial surrender of Additional
Accumulation Account, there will not be any deduction towards surrender
penalty.
• Discontinuation of the Premium Payment

If a customer discontinue the premium payments before premiums are paid for
first two consecutive policy years. If the payment of premiums is discontinued
before premiums are paid for first two consecutive policy years, the policy lapses.
The Policy Administration fees will be deducted. The Company will credit
Accumulation Rate to the Accumulation Account and Additional Accumulation
Account if any at the end of every calendar month and debit the Accumulation
Account and Additional Account with the Account Administration fees.

56
Any additional premiums can not
be paid while a policy is in lapsed condition. However, an Additional
Accumulation Account already existing on the date of
lapse will remain intact. If a policyholder dies while the policy is in a lapsed
condition, the balance in the Accumulation Account and Additional Accumulation
Account, if any on the date of intimation of death will be paid.
A lapsed policy can be revived within the revival period (i.e. a period of 5 years
from the due date of first unpaid premium or maturity date whichever is earlier).
If a lapsed policy is not revived at the end of period of revival, the policy will be
terminated.
If at any point of time during the revival period, the balance in Accumulation
Account is not sufficient to cover the Policy Administration Fee for the next
month, the balance in Additional Accumulation Account will be utilized for
meeting the Policy Administration Fee.

If the balances in Accumulation Account and Additional Accumulation Accounts

are not sufficient to meet the policy administration fees for the next month, the
policy will be terminated. A terminated policy cannot be reinstated. Whenever the
base policy is terminated, the Additional Accumulation Account will also be
terminated by paying the balance in the Additional Accumulation Account to the
policyholder.
If you discontinue the premium payments after premiums are paid for two
complete policy years:
If the payment of regular premiums is discontinued after the regular premiums for
two complete policy years are paid, a policy will be in "Paid-up" status.
Policy Administration fees will be deducted from the accumulation Account.
At the end of every calendar month, the Company will credit the Accumulation
Account and Additional Accumulation Account with the Accumulation Rate and
debit the Accumulation and Additional Accumulation Accounts with Account
Administration Fees.
Additional premiums cannot be paid while a policy is in paid up condition.

57
The death benefit under a paid up
policy will be the balance in the Accumulation Account and Additional
Accumulation Account, if any. If at any point of time during the revival period,
the balance in Accumulation Account is not sufficient to cover the Policy
Administration Fee for the next month, the balance in Additional Accumulation
Account will be utilized for meeting the Policy Administration Fee. If the
balances in Accumulation Account and Additional
Accumulation Accounts are not sufficient to meet the policy administration fees
for the next month, the policy will be terminated. A terminated policy cannot be
reinstated. Whenever base policy is terminated, the Additional Accumulation
Account will also be terminated by paying the balance in the Additional
Accumulation Account to the policyholder.

A paid up policy can be revived during the revival period (i.e. a period of 5 years
from the due date of first unpaid premium or maturity date whichever is earlier).
If the policy is not revived during the period of revival, the policy will be
terminated by paying the surrender value at the end of revival period .

• Revival of the policy

A customer can revive lapsed or paid-up policy by recommencing the payment of
premiums at any time within a period of five years from the due date of first
unpaid premium but before the maturity date of the policy.

• A loan facility under this Policy

Not Available

• 15 day free look period:

58
In the event the policyholder
disagree with any of the terms and conditions of the policy, he/she may return the
policy to the Company within 15 days of its receipt for cancellation, stating
his/her objections in which case he/she shall be entitled to a refund of the
premium paid.

• Nomination and Assignment

Nominations will be allowed under this plan as per Section 39 of the Insurance
Act, 1938. Assignment not allowed under this plan.

• General Exclusion
If the life insured, whether sane or insane, commits suicide within 12 months
from the date of commencement of this policy or the date of any revival of the
policy the company will limit the death benefit to the accumulation account Value
and Additional Accumulation Account value, if any.

• Tax Benefit
Premiums paid are eligible for tax deduction under the Income Tax Act, 1961 and
subsequent amendments.
Please note that all benefits payable under the policy are subject to tax laws and
other financial enactments as they may exist from time to time. You are
recommended to consult your tax advisor.

59
 ANALYSIS
FOR THE ANALYSIS A COMPARSION HAS BEEN DONE AMONG THE
PRODUCTS AND THEIR RESPECTIVE RETURNS GENERATED, WITH IN
THE TIME SPAN OF TWO YEARS, OF RELIANCE LIFE INSURANCE
WITH ICICI PRUDENTIAL.
NOW FOLLOWING ARE THE BASIC COMPARISON DETAILS:

• RELIANCE MONEY GUARANTEE PLAN AND ICICI INVEST

SHIELD LIFE

COMPARISON MONEY GUARANTEE INVEST SHIELD LIFE

PLAN

60
SEGMENTATION NOT AVAILABLE.
CUSTOMER
SEGMENTATION IS
MADE.

CAPITAL GUARANTEE IS AVAILABLE. IS AVAILABLE.

UNIQUE FEATURE RETURN SHIELD OPTION INVEST SHIELD OPTION

POLICY ADMIN. RS40 PER MONTH RS50 PER MONTH

CHARGE

FUND MANAGEMENT 1.29%P.A. 1.25%P.A.

CHARGES

1ST YEAR-20% 1ST YEAR-30%

PREMIUM ALLOCATION 2ND YEAR-5% 2ND YEAR-10%
CHARGES 3RD TO 5TH YEAR-3% 3RD ONWARDS-3%
6TH TO 8TH YEAR-2% (AND THIS VARY ACC.
9TH YEAR ONWARDS-1% TO AMOUNT OF
PREMIUM)

LOAN FACILITY NO LOAN CAN BE LOAN CAN BE AVAILED,

AVAILED. CURRENTLY – 40% OF
TH E SURRENDER
VALUE.
• NEW MAJOR • CRITICAL
RIDERS AVAILABLE SURGICAL ILLNESS RIDER
BENEFIT RIDER • ACCIDENTAL AND
• NEW CRITICAL DEATH BENEFIT
CONDITIONS(25) RIDER
RIDER • WAIVER OF
• TERM LIFE PREMIUM RIDER
INSURANCE
BENEFIT RIDER
• ACCIDENTAL
DEATH AND
TOTAL AND
PEMANENT
DISABLEMENT
RIDER
61
COMPARISON WITH THE HELP OF RETURNS GENERATED WTIH
IN THE PAST TWO YEARS

RETURNS OF RELIANCE MONEY GUARANTEE PLAN

Fund Performance

NAV Performance Analysis

Following are the Unit values from 01 April 2008 to 31 Aug 2010 for MGP -
Return Shield Fund.

62
 MGP - Return Shield Fund

NAV
Fund Name
Growth(CAGR %)
MGP - Return Shield Fund 8.2046 %

RETURNS OF ICICI PRU INVEST SHIELD PLAN

Fund Performance

NAV Performance Analysis

Following are the Unit values from 01 April 2008 to 31 Aug 2010 for
INVEST SHIELD LIFE Fund.

63
INVEST Shield life Fund

Fund Name NAV Growth(CAGR %)

INVEST shield life fund 9.42%

• RELIANCE SUPER AUTOMATIC INVESTMENT PLAN AND

ICICI PRU LIFE TIME SUPER PLAN

64
COMPARISON SUPER AUTOMATIC LIFE TIME SUPER
INVESTMENT PLAN

PREMIUM RS10,000 P.A. RS18000 P.A.

LOAN FACILITY NO LAON IS AVAILABLE LOAN IS AVAILABLE

UPTO 40% OF SURRENDE
VALUE
MIN- 5 TIMES OF THE SUM ASSURED IS A
SUM ASSURED ANNUALISED PREMIUM. MULTIPLE OF THE
MAX-30 TIMES OF THE ANNUAL PREMIUM PAID.
ANNUALISED PREMIUM.

• READY MADE • MAXIMISER

FUND OPTION • TAILOR MADE • BALANCER
• PROTECTOR
• LIQUID
• NEW MAJOR • CRITICAL ILLNESS
RIDERS SURGICAL BENEFIT RIDER
BENEFIT RIDER • ACCIENTAL AND
• NEW CRITICAL DISABLEMENT
CONDITIONS(25) RIDER
RIDER
• TERM LIFE
INSURANCE
BENEFIT RIDER

• ACCIDENTAL
DEATH AND
TOTAL AND
PERMANENT
DISABLEMENT
RIDER

UNIQUE FEATURE SYSTEMATIC TRANSFER FLEXIBILITY TO KEEP

PLAN OPTION IS CHANGING THE
AVAILABLE CUSTOMER’S LIFE TIME
NEEDS

65
PREMIUM ALLOCATION 1ST YEAR-20% 1ST YEAR-20%
CHARGES 2ND & 3RD YEAR-3% (PRE.<50,000)
4TH & 5TH YEAR-2% -18%
6TH YEAR ONWARD-1% (PRE.>50,000)
2ND YEAR-8.5%
3RD YEAR ONWARDS-4%

• READY MADE- • MAXIMISER-2.25%

FUND MANAGEMENT 1.32%P.A. • BALANCE-2.25%
CHARGES • TAILOR MADE- • PROTECTOR-1.5%
1.31%P.A. • PRESERVER-0.75%

SWITCHES 52 FREE SWITCHES 4 FREE SWITCHES

COMPARISON WITH THE HELP OF RETURNS GENERATED WTIH

IN THE PAST TWO YEARS

RETURNS OF RELIANCE SUPER AUTOMATIC INVESTMENT PLAN

Fund Performance

66
NAV Performance Analysis

Following are the Unit values from 01 April 2008 to 31 Aug 2010 for AIP -
Equity Fund.

AIP - Equity Fund

NAV
Fund Name
Growth(CAGR %)
AIP - Equity Fund 8.2200 %

RETURNS OF ICICI PRU LIFE TIME SUPER

Fund Performance
NAV Performance Analysis

Following are the Unit values from 01 April 2008 to 31 Aug 2010 for LIFE
TIME SUPER Fund

67
LIFE TIME SUPER Fund

Fund Name NAV Growth(CAGR %)

7.15%
LIFE TIME SUPER Fund
8.94%(MAXIMISER F)

• RELIANCE HEALTH+WEALTH PLAN AND ICICI PRU

HOSPITAL CARE

68
COMPARISON HOSPITAL CARE
RELIANCE H+W

WAITING PERIOD 90 DAYS 90DAYS

MAX AGE AT ENTRY 60 YEARS 55 YEARS

DAILY AVAILABLE AVAILABLE

HOSPITALISATION
CASH BENEFIT

SURGICAL BENEFIT BUILT INTO THE PLAN, PREM. PAYING RIDER, 33

OVER 900 SURGERIES MAJOR SURGERIES ONLY

RECUPERATING ON 5 DAYS OF DHCB; ON 5 DAYS OF DHCB; 2*DHCB

BENEFIT 3*DHCB
NOT AVAILABLE; BUT PREM. PAYING RIDER; ONLY
CRITICAL ILLNESS 33 ILLNESSES UNDER 25 ILLNESSES COVERED
CRISIS COVER

ICU BENEFIT YES YES

COVERAGE FRO FIRST AVAILABLE PAYABLE FROM THIRD DAY

48 HOURS ONWARDS

ANNUAL LIMIT 90 DAYS PER POLICY FIRST YR- 18 DAYS(7 FOR

YR (30 DAYS FOR ICU) ICU)
THEREAFTER-60 DAYS(30
FOR ICU)

LIFE TIME LIMIT 1800*DHCB 180 DAYS(90 DAYS FOR

CHILDREN BELOW 5 YRS)

MAX. COVERAGE PLAN D-RS 4000 PER RS2500 PER DAY FOR
AVAILABLE DAY FOR EACH PRIMARY; RS1500 FRO
MEMBER OF THE SPOUSE AND RS1250 FOR
FAMILY CHILDREN

69
HOSPITALISATION & SUPERIOR COVERAGE
SURGERY COVERAGE LIMITED COVERAGE

FUNDS AVAILABLE NO FUNDS 4 FUNDS

PORTFOLIO NA READY MADE OR TAILOR

STRATEGY MADE

INEDPENDENT OF YES YES

MEDICLAIM

LIFE COVER BUILT INTO PLAN PREMIUM PAYING RIDER

PREM. ALLOCATION NIL FY-20%

CHARGE THEREAFTER-3%

POLICY ADMIN RS60 PER MONTH RS40 PER MONTH

CHARGE

COMPARISON WITH THE HELP OF RETURNS GENERATED WTIH

IN THE PAST TWO YEARS

RETURNS OF RELIANCE HEALTH AND WEALTH PLAN

Fund Performance

NAV Performance Analysis

70
Following are the Unit values
from 01 April 2008 to 31 Aug 2010 for RELIANCE HEALTH AND
WEALTH FUND

W+HP - Equity Fund

NAV
Fund Name
Growth(CAGR %)
W+HP - Equity Fund 0.4674 %

• RELIANCE SUPER GOLDEN YEARS PLAN AND LIFE TIME

PENSION PLAN

71
COMPARISON SUPER GOLDEN YEARS
PLAN LIFE TIME PENSION

BASIC UNIT-LINKED PENSION SAVING CAN BE

PRODUCT MAXIMISED BY TAKING
THE ADVANTAGE OF THE
MARKET.

SUM ASSURED 5 TIMES OF THE RS1,00,000

ANNUALISED PREMIUM.

MIN-18 YEARS MIN- 18 YEARS

AGE AT MAX-65 YEARS MAX-60 YEARS
ENTRY(PROPOSER) MAX AGE AT VESTING- MAX AGE WITH ZERO
75 YEARS BENEFIT-65 YEARS

TERM MIN-16 YEARS MIN-10 YEARS

• LIFE ANNUITY • LIFE ANNUITY

ANNUITY OPTION • LA WITH RETURN • LA WITH RETURN
• LA GUARANTEED • LA GUARANTEED
FOR 5,10 OR 15YRS • JOINT LIFE LAST
THEREAFTER SURVIVOR(RETURN)
• JLLS(WITHOUT
RETURN)

OPEN MARKET OPTION AVAILABLE AVAILABLE

EXTENSION OF AVAILABLE AVAILABLE

RETIREMENT DATE

72
COMMUTATION OPTION AVAILABLE
AVAILABLE

8 FUNDS 7 FUNDS
FUND OPTION (MONEY MKT,
BALANCE, GROWTH, (MAXIMISER, BALANCER,
GILT, ENERGY, MID CAP PROTECTOR, PRESERVER
ETC.) ETC.)

POLICY ADMIN CHARGE RS40 PER MONTH RS20 PER MONTH

FUND MGMT CHARGE 3.5%P.A. 1%P.A.

1ST YR-7.5% 1ST YR-22%

PREMIUM ALLOCATION 2ND TO 10TH YR-5% 2ND YR-15%
CHARGE 11TH YR ONWARDS-1% 3RD TO 10TH YR-1%
11TH YR ONWARDS-NIL

1ST 3 YRS-NIL BESIDE 1ST YR- NIL

SURRENDER VALUE 4TH YR-80% OF F.V AFTER 1ST YR-25% OF F.V
5TH YR-90% OF F.V AFTER 2ND YR-40%
6TH YR ONWARDS-100% AFTER 3RD YR- 60%
AFTER 4TH YR-100%

COMPARISON WITH THE HELP OF RETURNS GENERATED WTIH

IN THE PAST TWO YEARS

RETURNS OF RELIANCE SUPER GOLDEN YEARS PLAN

Fund Performance

73
NAV Performance Analysis

Following are the Unit values from 01 April 2008 to 31 Aug 2010 for
RELIANCE SUPER GOLDEN YEARS FUND

GYP - Equity Fund

NAV
Fund Name
Growth(CAGR %)
GYP - Equity Fund 11.3793 %

RETURNS OF ICICI PRU LIFE TIME PENSION PLAN

Fund Performance

NAV Performance Analysis

Following are the Unit values from 01 April 2008 to 31 Aug 2010 for ICICI
LIFE TIME PENSION FUND

74
 LIFE TIME PENSION Fund
Fund Name NAV Growth(CAGR %)
LIFE TIME PENSION Fund 7.84%

• RELIANCE LIFE SECURE CHILD PLAN AND ICICI PRU

SMART KID PLAN

COMPARISON RELIANCE SECURE ICIC PRU SMART KID

CHILD PLAN

75
 BASIC FEATURE MONEY AT CRITICAL
MILESTONES OF SAVING + PROTECTION
CHILD’S CAREER

SUM ASSURED ANNUALISED PREM. * MIN=RS1,00,000

POLICYTERM/2 MAX=INFINITY

AGE AT ENTRY(CHIL) MIN-0YR MIN-30 DAYS

MAX-15YRS MAX-15YRS

AGE AT MIN-21YRS MIN-20YRS

ENTRY(PARENT) MAX-50YRS MAX-60YRS

PARTIAL AFTER 3YRS AFTER 5YRS

WITHDRAWALS

FLEXIBILITY TO
AMNT OF 20% OF FUND VALUE DECIDE, 5
WITHDRAWALS WITHDRAWALS IN THE
WHOLE TERM
(20%, 25%, 30%, 35%,
40%)

E-ACCOUNT AVAILABLE NOT AVAILABLE

RETURN SHIELD AVAILABLE NOT AVAILABLE

OPTION

FUNDS 8 FUNDS 7 FUNDS

RIDERS 6 RIDERS AVAILABLE 3 RIDERS AVAILABLE

SETTLEMENT OPTION AVAILABLE NOT AVAILABLE

76
 1ST
PREMIUM YR-25% 1ST YR-19%
ND
ALLOCATION 2 YR-5% 2 TO 5TH YR-4%
ND

CHARGES 3RD TO 4TH YR-3% 6TH TO 10TH YR-2%

5 TO 10TH YR-2.5%
TH
11TH ONWARDS-1%

COMPARISON WITH THE HELP OF RETURNS GENERATED WTIH

IN THE PAST TWO YEARS

RETURNS OF RELIANCE SECURE CHILD PLAN

Fund Performance

NAV Performance Analysis

77
Following are the Unit values
from 01 April 2008 to 31 Aug 2010 for RELIANCE SECURE
CHILD FUND

SCP - Equity Fund

NAV
Fund Name
Growth(CAGR %)
SCP - Equity Fund 6.9022 %

RETURNS OF ICICI PRU SMART KID PLAN

Fund Performance

NAV Performance Analysis

Following are the Unit values from 01 April 2008 to 31 Aug 2010 for ICICI
PRU SMART KID FUND

78
 SMART KID Fund
NAV
Fund Name
Growth(CAGR %)
SMART KID Fund 9.6 %

INTERPRETATION

While studying about the Unit Linked Insurance Plans of Reliance life, certain
things can be interpreted. These are as follows:
1) Insurance plans offered by reliance, provides insurance benefits to its
customers.
2) Reliance helps its customers to safeguard their investment.

79
 3) ULIPs help the people to
save their hard earned money.
4) These plans provide tax benefits to its customers.
5) Company’s allocation charges are quite high in its money guarantee plan.
6) Company provides assured amount on some of its policies if the amount
has been deposited for specific period of time.
7) Company also provides switching option to its customers, which enables
the investor to guide his investment to various funds as per the market
fluctuations.
8) Company also provide with the readymade investment option which helps
the customers to understand the funds more clearly.
9) Free look period of 15 days is provided by the company to its customers,
which enables the people to get its policies cancelled within the 15 days
from the date of issuance of policy.

FURTHER THE INTREPRETATON IS DONE WHILE CONSIDERING

THE ICICI PRU PRODUCTS

We can see the returns generated by both the companies, the past track record of
ICICI Prudential is much competent than of reliance life insurance company’s
products.

80
As observed from the above data,
the fund performance of ICICI Prudential Life Insurance is much better than of
Reliance Life Insurance, but it is also true that ICICI Prudential is into Life
Insurance business since 2000 and Reliance has entered into the market in 2006.
As far as returns and claims are concerned, ICICI Prudential has given decent
returns in the past 2 years & claim process is also quite fast.
Despite of 4yrs of existence in the market, Reliance is improving on giving better
returns to their customers. Therefore, good returns are expected in future as well.
Reliance is also offering a vast Portfolio of funds offered in various plans, and
also it gives an option to the customer to invest his money into various funds,
called Tailor-Made Option.

Recommendations

81
1) Company must reduce its
charges on various plans to make the product more customer oriented.

2) The company should introduce some short term plans along with long
term plans to make more options available to the customers.
3) The company should increase the limit of partial withdrawal after the relavant
time given in a policy.
4) The company must guide their task to the transparency factor for their
customers.
5) The company should enhance its fund management, so that better returns are
generated in future.

6) The Company should send periodical statements to the customers, so that

they can review their investments & returns regularly.
7) Company should focus more on Brand Building through print media as well
as television advertisement, so that they can increase their visibility in the
market.

CONCLUSION

82
After the in-depth research
conducted the conclusion can be viewed as , the Overall returns of the ICICI
Prudential are more lucrative than Reliance life insurance. But due to some new
changes made by IRDA (Insurance regulatory development authority) the sales
for the products are more competitive, less margins are available to the agents and
products have become more customer oriented.

The new guidelines employed by IRDA are like:

• Allocation charges for any company for a ulip product can not be more
than 30% in a 10 year term.
• The commission paid to the insurance agent can not be more than 10%
through out the 10 year term.
• Surrender of any ulip plan can not be done before 5 years, incase of
surrender of policy before 5 year, a huge surrender charges are to be borne
by the policy holder.

• Partial withdrawals for ulip plan were earlier allowed after three years but
the facility of partial withdrawal is extended to 5 years in any ulip plan.

• Partial withdrawals were earlier available free of cost but from now
onwards some nominal charges are paid by the policy holder per
withdrawal.

• Insurance companies are now focusing on long term products; the

minimum term of any product is 15 years instead of 10 years.

83
After analyzing the above
mentioned points, it has been concluded that by implementation of new changes,
IRDA has made the insurance products more customer oriented, as well as there is
maximum participation of funds in the product. Also, companies are focusing on
long term products, so that better returns can be given to the customers. A new
step has been taken by the IRDA is to aware the customer about the earnings of
the agents made through them in a Ulip Product.
After the overall conclusion, these changes will increase the interest of a customer
to invest in a Ulip Product.

84
 B
IBLIOGRAPHY

Books:
1) Life insurance, McGill, McGill’s Life Insurance( Huebner School Series),
American College 3rd edition (January 1994), page no. 484
2) Principles and Practices of Life Insurance(1892), Nathan Willey and
Henry Worthington Smith, Kessinger Publishing, page no. 201

Magazines and pamphlets:

1) Reliance plans pamphlets
2) Insurance watch magazine.
3) Icici plans pamphlets

Websites referred:

1) www.reliancelife.co.in

2) www.wikipedia.com

3) www.irdaindia.org

4) www.iciciprulife.com

85
86