INTRODUCTION TO INSURANCE LIFE INSURANCE GENERAL Insurance is a system to alleviate financial losses by transferring risk of loss from one entity to another.Insurance is basically a sharing device. The losses to assets resulting from natural calamities like fire, flood, earthquake, accidents, etc. are met out of the common pool contributed by large number of persons who are exposed to similar risks. This contribution of many is used to pay the losses suffered by unfortunate few. However the basic principle is that loss should occur as a result of natural calamities or unexpected events which are beyond the human control. Secondly insured person should not make any gains out of insurance. It is natural to think of insurance of physical assets such as motor car insurance or fire insurance but often we forget that creator of all these assets is the human being whose efforts have gone a long way in building up the assets. In that sense, human life is a unique income generating assets. Unlike the physical assets, which decrease in value with passage of time, the individual becomes more experienced and more matured as he advances in age. This raises his earning capacity and the purpose of life insurance is to protect the income in the event of his premature death. The individual himself also needs financial security for the old age or on his becoming permanently disabled when his income will stop. Insurance also has an element of savings in certain cases. How insurance works? Suppose there are 1000 persons all aged 35 years and healthy lives. They are insured for one year against the risk of death. Each person is insured for Rs. 50,000. If the past experience indicated that 4 out of 1000 persons, at this age are expected to die during the year, expected amount of death claim to be paid to the family of four persons would come to Rs. 2,00,000. The contribution to be paid by each of the 1000 persons will come to Rs. 200 per year. Thus, all the 1000 persons share loss caused to the 4 unfortunate families. 996 persons who survived till one year have not lost anything as they secured peace of mind and a feeling of security of their family. While insurance cannot prevent accidents or premature death, it can help protect the family of the decreased against the loss of income caused by the death of the main breadwinner. In return for specified payments, insurance will provide protection against the incidence of an uncertain event- such as premature death. The business of insurance company called insurer is to bring together persons who are exposed to similar risks, collect contribution (premium) from them on some equitable basis and pay the losses (claims) to the unfortunate few who suffer. Classification of Insurance Insurance business can be divided into two broad categories, life and non-life. Life insurance is concerned with making provision for a specific event happing to the individual, such as death whereas non life (or general insurance) is more commonly concerned with the provision for a specific event which affects a property, such as fire, flood, theft etc. In this course we will only cover life insurance. So, let us now move on to the definition of life insurance.

Definition of Life Insurance According to the U.S. Life Office Management Association Inc. (LOMA), life insurance is defined as follows: Life insurance provides a sum of money if the person who is insured dies whilst the policy is in effect.

Life insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money (the "benefits") upon the death of the insured person. Depending on the contract, other events such as terminal illness or critical illness may also trigger payment. The policy holder typically pays a premium, either regularly or as a lump sum. Other expenses (such as funeral expenses) are also sometimes included in the benefits.

The advantage for the policy owner is "peace of mind", in knowing that the death of the insured person will not result in financial hardship for loved ones and lenders.

Life policies are legal contracts and the terms of the contract describe the limitations of the insured events. Specific exclusions are often written into the contract to limit the liability of the insurer; common examples are claims relating to suicide, fraud, war, riot and civil commotion.

NEED FOR LIFE INSURANCE

Risks and uncertainties are part of life's great adventure -- accident, illness, theft, natural disaster - they're all built into the workings of the Universe, waiting to happen.Insurance then is man's answer to the vagaries of life. If you cannot beat man-made and natural calamities, well, at least be prepared for them and their aftermath. Insurance is a contract between two parties - the insurer (the insurance company) and the insured (the person or entity seeking the cover) - wherein the insurer agrees to pay the insured for financial losses arising out of any unforeseen events in return for a regular payment of "premium". These unforeseen events are defined as "risk" and that is why insurance is called a risk cover. Hence, insurance is essentially the means to financially compensate for losses that life throws at people - corporate and otherwise.The principle of insurance works on the concept of a large number of people exposed to a similar risk making a contribution to a common fund. Those who suffer losses due to the occurrence of these events are compensated for them from this fund.

ROLE OF LIFE INSURANCE Life Insurance As An Investment: -Insurance is an attractive option for investment. While most people recognize the risk hedging and tax saving potential of insurance, many are not aware of its advantages as an investment option as well. Insurance products yield more compared to regular investment options, and this is besides the added incentives offered by insurers.You cannot compare an insurance product with other investment schemes for the simple reason that it offers financial protection from risks, something that is missing in non-insurance products. In fact, the premium you pay for an insurance policy is an investment against risk. Thus, before comparing with other schemes, you must accept that a part of the total amount invested in life insurance goes towards providing for the risk cover, while the rest is used for savings.In life insurance, unlike non-life products, you get maturity benefits on survival at the end of the term. In other words, if you take a life insurance policy for 20 years and survive the term, the amount invested as premium in the policy will come back to you with added returns. In the unfortunate event of death within the tenure of the policy, the family of the deceased will receive the sum assured.Now, let us compare insurance as an investment options. If you invest Rs 10,000 in PPF, your money grows to Rs 10,950 at 9.5 per cent interest over a year. But in this case, the access to your funds will be limited. One can withdraw 50 per cent of the initial deposit only after 4 years.The same amount of Rs 10,000 can give you an insurance cover of up to approximately Rs 5-12 lakh (depending upon the plan, age and medical condition of the life insured, etc) and this amount can become immediately available to the nominee of the policyholder on death. Thus insurance is a unique investment avenue that delivers sound returns in addition to protection.

TYPES OF LIFE INSURANCE PLANS

Life Insurance Plans:Under Life insurance plans Dlf pramerica offers plans under the following major need categories:Education Insurance Plans

Wealth Creation Plans

Premium Guarantee plans

Protection Plans

Premium Guarantee Plans

The latest addition to the life insurance product portfolio of DLF Pramerica is the Premium Guarantee plan - InvestShield Life New. Premium Guarantee plans are the ideal insurance-cum-investment option for customers who want to enjoy the potentially higher returns of a market linked instrument, but without taking any market risk.

Under the Premium Guarantee Plans platform, DLF Pramerica brings to you the following products:

Plan Name

InvestShield Life New InvestShield CashBak

Plan Type

Unit LinkedUnit Linked

Protection Plans

The sole objective of these plans, as their name indicates, is to serve the protection needs of the customer and by doing so, safeguard ones family from the financial implications of unfortunate circumstances than one cannot foresee.Under the Protection Plans platform DLF Pramerica brings to you the following products:

Plan Name

LifeGuard Save'n'ProtectCashBakHome Assure

Plan Type

TraditionalTraditionalTraditionalTraditional

THE INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY (IRDA)

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies.The other decision taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies was the launch of the IRDAs online service for issue and renewal of licenses to agents.The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products, which are expected to be introduced by early next year. Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 23 life insurance and 6 general insurance companies have been registered.

WHY PRIVATE INSURANCE?

All the private companies have a lock in period of 3 yrs hence no disinvestments possible. Minimum net worth of 500 Cr required for acquiring license with a minimum paid up capital of 100 Cr in their insurance venture. Commitment to increase the paid up capital manifold in next five years. Re insurance for all its policies worth more than 5 lakhs. Reinsurance partners, best and the largest in the world general cologne and Swiss reinsurance. Audit of accounts by at least 2 independent approved auditors each year. Products and pricing are cleared by IRDA, which looks into the financial visibility of the product and the financial implication. IRDA is now proposing a Pvt. Policy Protection fund. Funds to be invested in only regulated and controlled areas with close to 80%being pumped into only gilts thereby assuring safety of funds.

Ashok Khurana (September 16, 2010):Conclude that ;Insurance in India has been emerging as an important and profitable business. Every insurer wants to capture the maximum share in the market and is offering both Unit Linked Insurance Plans (ULIP) and traditional plans. ULIPs are the youngsters in the product portfolios of life insurance companies. They provide the buyer a life cover as well as investment avenue. It is observed that as a whole Wealth Advantage plan of ICICI Pru is the best plan in terms of diverse ULIP features and charges. Birla Sun Lifes Individual Life Creator and Birla Sun Lifes Individual Life Magnifier has emerged as the top two ULIP funds.

Divya Y. Lakhani, Assistant Professor (21-september-1998):Depicts that Unit Linked Insurance Plans (ULIP) had emerged as a major player in savings mobilization. Investors had showed keen interest by subscribing to ULIP scheme anticipating higher returns. However with the global recessionary trend the performance of ULIP had been drastically affected. The BSE Sensex which had shot up to 21000 points came crashing down and stood at 8335 points on12th March 2009 and had greatly affected the Net Asset Value (NAV) across all the plans of various companies.

Jeffrey W. Stempel (March 1, 2009): said that insurance policies are a type of contract. But characterizing them only as contracts misses much of the richness of the insurance arrangement, policyholder-insurer relations, and the degree to which insurance policies, which are heavily standardized, are designed to perform a particular function. Because of their mass standardization and deployment to address particular risk management issues, insurance policies are in many respects like products or chattels. Insurers and the insurance trade press in fact frequently speak of a line of insurance "products" or a new "product" being introduced to address an emerging risk. Appreciating this aspect of the insurance policy can assist courts in construing policies and resolving coverage disputes, particularly where the language at issue is unclear or problematic if literally applied. Building on prior scholarship, this article develops the notion of the insurance policy as a "thing" as well as a contract and provides examples of the interpretative value of deploying this additional perspective

Kostas Koufopoulos (November 14, 2008):Conclude that competitive models of asymmetric information predict a positive relationship between coverage and risk. In contrast, most recent empirical studies find either negative or zero correlation. This paper, by introducing heterogeneity in risk perceptions into an asymmetric information competitive model, provides an explanation to this puzzle. If optimism discourages precautionary effort, there exist separating equilibria exhibiting the observed empirical patterns. It is also shown that zero correlation is consistent with information barriers to trade in insurance markets. Philippe Bertrand (December 2001):Conclude that performances of the two standard portfolio insurance methods: the Option Based Portfolio Insurance (OBPI) and the Constant Proportion Portfolio Insurance (CPPI). First we examine basic properties of these two strategies and compare them by means of various criteria: comparison of their payoffs, possible property of stochastic dominance, expectations, variances, skewness and kurtosis of their returns, and some of the quantiles of their returns. He said that the OBPI method can be analyzed as a kind of CPPI where the multiple is allowed to vary.

Randy E. Barnett (September 21, 2010): Explain that the Patient Protection and Affordable Care Act includes what is called an individual responsibility requirement or mandate that all persons buy health insurance from a private company and a separate penalty enforcing this requirement. In this paper, I do not critique the individual mandate on originalist grounds. Instead, I explain why the individual mandate is unconstitutional under the existing doctrine by which the Supreme Court construes the Commerce and Necessary and Proper Clauses and the tax power. There are three principal claims.

Suleyman Basak ( May 2001): focus on portfolio insurers who drive utility from horizon wealth, with marginal utility tending smoothly to infinity at some pre-specified floor. We solve for the optimal consumption-portfolio-wealth of these portfolio insurers and compare with "constrained" portfolio insurers and "normal agents." General equilibrium conditions are contrasted under pure-exchange and production-type models. While the market price level is unambiguously increased under pure-exchange, under production the effect on market level is state-dependent. In both models the market volatility and risk premium are decreased by portfolio insurance

Monica Billio (November 1, 2011):Depicts that several econometric measures of connectedness based on principal-components analysis and Granger-causality networks, and apply them to the monthly returns of hedge funds, banks, broker/dealers, and insurance companies. These measures can also identify and quantify financial crisis periods, and seem to contain predictive power in out-of-sample tests show an asymmetry in the degree of connectedness among the four sectors, with banks playing a much more important role in transmitting shocks than other financial institutions.

Igor Vaysburd (July 9, 1999):Conclude that selected dynamic investment strategies are analyzed within a unifying theoretical framework. This gives a possibility to study much wider class of strategies than is usually done in the literature and practical applications. Using our equation we build dynamic efficient frontier and demonstrate that an attempt to minimize variance for a given expected profit leads to a contrarian trading strategy, also known as the "St.Petersburg paradox". Similar analysis is performed for the Black-Jones-Perold constant proportion portfolio insurance (CPPI).

INDUSTRY PROFILE Background

In 1912, the Indian life insurance companies Act was passed . This was the first comprehensive legislation in India to regulate the business of insurance. it had been observed that the provisions of Indian Companys Act did not meet the purpose. A further legislation was passed in 1928, But a comprehensive legislation was passed in 1938. The amendments in the act were made in 1956 when insurance was nationalized and LIC and GIC were formed.Life insurance business was nationalized with effect from 19 January 1956 and 256 companies were merged. Insurance Act was further amended in 1999 and IRDA was formed in view of the circumstances arising out of opening up of insurance industry in 2000.IRDA authority to protect the interest of the holders of insurance policies, to regulate , promote and ensure the working of all companies.As we enter into the new millennium, economies of the world over are getting redefined and remodeled with the new mindsets, new technologies, new riles and new directions. Financial sector reforms received top priority ever since the Govt. of India initiated the process of economic liberalization. These reforms are extending the horizons of the financial services sector and have been transforming our capital markets , banking and financial services industries.In the last four decades , after nationalization of the insurance industry , certain socio-economic objectives were achieved through public ownership of the insurance business. Yet, market oriented dynamism was missing as evidenced by the lack of product innovations, high premium rates and limited use of information technology.The insurance sector reforms have encouraged Blue-Bloods of Indian corporate sector DLF PRAMERICA,TATA,ICICI,HDFC,BIRLA,SBI,RELIANCE,KOTAK etc to tie up with worlds largest insurance majors to capture slice of the countrys potential insurance market.This has brought abuzz activities in insurance business. New players are wooing the customer with promises of better services and customized products. The LIC and GIC are countering the competition on the strength of their track records, distribution networks and so on.This new scenario will witness financially sound and experienced players transforming the industry with best products in service and product development , operational efficiency, marketing capability, service plus and tech-savvy orientation. As a result, the insurance business can become global with e-business applications.It is awkward business playing value figures on peoples lives. It is almost as awkward as selling the likelihood of an event people do not want crossing their minds . in India, it is rather a shrub. For this reason alone life insurance is no ordinary market. Under the pressure of competitors differentiate their offerings, insurers no longer sell life insurance as a product that meets a basic need , many of them sell though the appeal of a wide variety of add on benefits ranging from tax saving to investment return, sometimes pitying more emphasis on these basic benefits.This assumes significance because India is witnessing foreign competition in this sector after a long monopoly period.There is consensus on success becoming a function of market strategy. So far the market has been shaped by LIC . it is only recently that private insurers with 74:26 joint ventures between Indian and foreign companies have been formed under the watch of IRDA. ICICI prudential, DLF PRAMERICA,HDFC slandered life and Max New York Life were first off the block, followed by Kotak Mahindra, Royal Sundram,TATA Aig,Birla Sunlife,SBI Life and ING Vyasa which were started later.Sudden burst of competition itself is a unique occurrence. The Indian market distinguishes itself in other ways too, most notably in the areas of consumer perception and investment option. So it is worth which will the market move and what could be the winning strategies. Basic premise is clear that life insurance is a specialized business.

INSURANCE COMPANIES IN INDIA

1. Life Insurance Corporation of India2. Bajaj Allianz Life Insurance Co. Ltd3. Birla Sun Life Insurance Co. Ltd 4. HDFC Standard Life Insurance Co. Ltd5. ICICI Prudential Life Insurance Co. Ltd6. ING Vysya Life Insurance Co. Ltd7. Max New York Life Insurance Co. Ltd8. Met Life India Insurance Co. Ltd9. Kotak Mahindra Old Mutual Life Insurance Co. Ltd10. SBI Life Insurance Co. Ltd11. Tata AIG Life Insurance Co. Ltd12. Reliance Life Insurance Co. Ltd13. Aviva Life Insurance Co. Ltd14. Sahara India Life Insurance Co. Ltd15. Shriram Life Insurance Co. Ltd16. Bharti AXA Life Insurance Co. Ltd17. Future General Life Insurance Co. Ltd18. IDBI Fortis Life Insurance Co. Ltd19. Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd20. AEGON Religare Life Insurance Co. Ltd21. DLF Pramerica Life Insurance Co. Ltd22. Star Union Dai-ichi Life Insurance Co. Ltd23. National Insurance Company Ltd

DETAIL OF SOME LIFE INSURANCE COMPANY IN INDIAAlliance Bajaj Life Insurance Company LimitedAlliance Bajaj Life Insurance Company Limited is a joint venture between Alliance AG and Bajaj Auto Limited. The company was incorporated on March 12, 2001. The company received the IRDA certificate of registration on August 3, 2001 to conduct Life Insurance business in India.Birla Sun Life Insurance Company LimitedIt is a joint venture between Birla Group and Sun Life Corporation of U.S.The products of Birla Sun Life Insurance Company (BSLI) are distributed through a fully owned subsidiary BSDL Insurance Advisory Services Limited (BSDL IAS) BSDL. The company claims to have unique products, presenting a powerful combination of returns, liquidity, safety, tax benefits, transparency and convenience.

HDFC Standard Life Insurance Company LimitedHDFC and Standard Life was the first joint venture to enter the life insurance market, in January 1995. In October 1998, the joint venture agreement was renewed and Standard Life purchased 2 percent of Infrastructure Development Finance Company Limited (IDFC). The company as such, was incorporated on August 14, 2000 under the name of HDFC Standard Life Insurance Company Limited. HDFC are the main shareholders in HDFC Standard Life, with 81.4 percent, while Standard Life owns 18.6 percent. HDFC and Standard Life have a long and close relationship built upon shared values and trust.

ICICI Prudential Life Insurance Company LimitedThe company was incorporated on July 20, 2000, with an authorized capital of Rs.230 Crores (paid up Rs.190 Crores). It is a joint venture of ICICI (74%) and Prudential plc U.K (26%). The company is on the top of the list of competitors to LIC. The company was granted certificate of incorporation on 26-11-2000 and it started its operations on 19-12-2000.Life Insurance Corporation of India LimitedLIC was established in 1956 and is the dominant leader in life insurance in India. It has 7 zonal offices, over 100 divisional offices and 204 branches in India with over 6.50 lakhs agents.Tata AIG Life Insurance Company LimitedIt is capitalized at Rs.185 Crores of which 74 percent has bee Tata Sons and the American partner brings in the remaining 26 percent. American Insurance Group (AIG) is the leading U.S. based international insurance and financial services organization and the largest underwriter of commercial and industrial insurance in the United States. AIGs global businesses also include financial services and asset management. Including aircraft leasing, financial products, trading and market making, consumer finance, institutional, retail and direct investment fund asset management etc.SBI Life Insurance Company LimitedIndias largest bank SBI and Cardiff S.A. a leading insurer in France have firmed SBI Life. It is a 74: 24 venture; with Cardiff the foreign partner contributing 24 percent paid capital of Rs.250 Crores. SBI plans to market the insurance products through select branches of SBI and its seven associate banks.

OM Kotak Mahindra Insurance Company LimitedThe joint venture OM Kotak Mahindra Life Insurance started off with an initial net worth of Rs.150 Crores, with 74: 26 stake between KMFL and OM. Kotak Mahindra is one of Indias premier financial services groups, with a range of over two dozen highly specialised products and services. Starting as a one-product company in the mid 80s, they have evolved into a full service financial conglomerate. Old Mutual pic. Is a leading financialservices provider in the world, providing a broad range of financial services in the area of insurance, asset management and banking. It is a leading life insurer in South Africa, with more than 30 percent market share. The partnership with Old Mutual plc. provides the Kotak Mahindra group with an international perspective and expertise in the life insurance business.Max New York Life Insurance Company LimitedIt is a partnership between Max India Limited, one of Indias leading multi business corporations and New York Life, a Fortune 100 company. The paid up capital of the joint venture is Rs.250 Crores. Max India Ltd. is building businesses in the emerging knowledge based areas of Healthcare, Financial Services and Information Technology.

ING Vyasya Life Insurance Company Ltd.It is a joint venture between ING, Vyasya Bank, one of Indias leading private sector banks and GMR group. As per the joint venture agreement, Vyasya Bank holds 49 percent stake, ING 26 percent, and the GMR Group would hold 25 percent. The paid up capital of the joint venture is Rs.110 Crores. Vyasya Bank has a very high degree of retail focus with good customer service. ING Group, with an asset base of over Rs.28, 42,000 Crores is a global financial institution of Dutch origin, which is active in the field of banking, insurance and asset management in more than 60 countries.

Aviva Life Insurance Company Ltd.It is a joint venture between Dabur India and CGU, a wholly owned subsidiary of Aviva Pic, is capitalised at Rs.110 Crores. Aviva Pic is the largest life and general insurance group of UK and the worlds largest insurer with worldwide premium income and retail investment sales of 28 billion. Aviva Life has tied up with ABN Amro, Canara Bank, Laxmi Vilas Bank and American Express for distribution of its products. AMP Sanmar Assurance Company Ltd.It is a joint venture between AMP having a stake of 26 percent and the Sanmar Group holding 74 percent. The Sanmar group is one of the largest industrial groups in South India. AMP Limited is one of the worlds leading financial services businesses.

DLF Pramerica life insurance company Ltd.It is a joint venture between DLF and PFI which is the financial company of USA which experience is more than hundred years. DLF is also world biggest real estate company.DLF Pramerica is 45 million dollar joint venture Company. They started insurance business from September 01, 2008. It is true the DLF Pramerica new company and there are many established companies already in the market but in India there many people who dont have any type of insurance so there is opportunity for DLF to earn some market share.

COMPANY PROFILE

About DLF Pramerica Life Insurance Co. Ltd.

DLF Pramerica Life Insurance Co. Ltd. (referred to hereafter as DPLI) is a joint venture between DLF Limited, one of Indias largest and most respected real estate organizations, and Prudential International Insurance Holdings, Ltd (PIIH), a fully owned subsidiary of Prudential Financial, Inc. (hereafter referred to as PFI), a U.S. based financial services leader. PFI has more than 130 years of experience in serving the financial needs of individual and institutional customers. Headquartered in Newark, New Jersey, PFI has approximately $693 billion of assets under management as of March 31, 2010. DPLI commenced operations in India on September 01, 2008 and is expanding its presence in the country in a phased manner. After establishing a strong presence in North India, it has now ventured into West India, starting with Gujarat. It recently opened a branch office in Ahmedabad. As of date, DPLI has 14 innovative insurance products in its portfolio, including pure protection, pension, child and unit-linked products. Most of these offer additional Riders - the DLF Pramerica Critical Illness Rider and DLF Pramerica Accidental Death Benefit Rider - giving customers the option to choose from different product combinations. Over time, the Company plans to add health and annuity products as well as additional long-tenor protection oriented products.

Recognizing the importance of providing superior insurance advice to customers, DPLI is building strong distribution capabilities that are keenly focused on providing high quality advice, products and services. Towards this end, the company is investing significant time and resources in recruiting the right talent and developing a highly-trained sales force that is equipped to assess customers needs in order to offer personalized and effective insurance solutions. Besides focusing on raising the standards of life insurance in the country by helping elevate the quality of advice, DPLI is also working towards changing consumer mindsets from investment returns to protection. Communication is aimed at educating Indian consumers on the critical need for protection to provide financial security in the case of any eventuality. The combination of the strength of the DLF brand and PFI's insurance expertise provides one of the strongest possible foundations for DPLI to succeed in the rapidly growing Indian life insurance market.

About DLF DLF Limited (www.dlf.in) is one of the leading real estate companies in the world. It has a 62-year track record of sustained growth, customer satisfaction, and innovation. DLF's primary business is development of residential, commercial and retail properties. DLF has a unique business model with earnings arising from development and rentals. As of September 30, 2009, the company has around 238 million sq. ft. of existing development and 432 million sq. ft. of developable area, of which 49 million sq. ft. is under construction. DLF has entered into several strategic alliances with global industry leaders. Also, it has recently forayed into the infrastructure, SEZ, financial services and hotel businesses.

About PFI Pramerica Financial is a trade name used by Prudential Financial, Inc., a company incorporated and with its principal place of business in the United States, and its affiliates in select countries outside the United States. PFI (NYSE: PRU), a financial services leader with approximately $693 billion of assets under management as of March 31, 2010, has operations in the United States, Asia, Europe, and Latin America. PFIs diverse and talented employees are committed to helping individual and institutional customers grow and protect their wealth through a variety of products and services, including life insurance, annuities, retirement-related services, mutual funds, investment management, and real estate services. In the U.S., the companys iconic Rock symbol has stood for strength, stability, expertise and innovation for more than a century. For more information, please visit www.news.prudential.com. PFI of the United States is not affiliated in any manner with Prudential plc, a company incorporated in the United Kingdom.

DLF Pramerica Life Insurance Co. Ltd. (DPLI) is a joint venture between DLF Limited and Prudential International Insurance Holdings, Ltd (PIIH), a fully owned subsidiary of Prudential Financial, Inc. (PFI), a U.S. based financial services leader. PFI has more than 130 years of experience in serving the financial needs of individual and institutional customers. Headquartered in Newark, New Jersey, PFI has approximately USD 558 billion of assets under management as of December 31, 2008. DPLI commenced operations in India on September 01, 2008, with the introduction of two innovative insurance products - DLF Pramerica Family Income Plan and DLF Pramerica Wealth+. The company has recently launched DLF Pramerica Golden Age, a Unit-Linked Pension Plan with many advantages, including built-in safety measures to help safeguard an individual?

Vision and Mission

Our Vision At DLF Pramerica Life Insurance Co. our vision is to ensure that every life we touch feels secure and enriched.

Our Mission We shall be a guide and a mentor to people so that they are able to make the most informed insurance decisions to meet their life goals.

Our Values Customer Focused Be someone who places customers and their needs at the forefront while developing and managing their financial solutions. Mutual Respect Build mutual respect by being an equal partner, who knows and willingly shares, helping people go further, rather than walking ahead and leading them, or walking behind and following. Worthy of Trust Build trust by choosing the right path, rather than the easy path and tell the truth the way it is. Be someone who keeps promises, meets commitments and behaves with integrity at all times. Winning Be positive and confident; seize every moment, every day, with a winning perspective, fearlessly facing the uncertainties of life.

Awards & Recognitions

DPLI was awarded as the "Best Insurer Technology" by Asia Insurance Review and Celent (part of Oliver Wyman group) in the inaugural Asia Insurance Technology Awards held in Seoul in November 2011. The company was recognised for its initiatives in using technology to make life insurance solutions accessible to the under-developed/ under-served markets.

DPLI won the "Skoch Financial Inclusion Award" in 2011 for an innovative marketing initiative that aimed to generate awareness and understanding about the need and benefits of life insurance among rural customers. The Skoch Awards recognize organizations doing noteworthy work in the area of financial inclusion

The RockStanding tall and firm. At DLF Pramerica, the Rock is not just a corporate symbol. It is the essence of our being. It is the icon of strength, stability, expertise and innovation and is the symbol of our unshakable commitment to our customers, stakeholders and employees. It is also the seal of security for the lives we touch. In fact, at the heart of everything we offer at DLF Pramerica - be it a sense of trust, a ray of hope or a dash of happiness, are values that are truly and quintessentially Rock-Solid.

PRODUCTS OF DLF PRAMERICA Protection PlansLife is uncertain and the future even more so. Keeping that in mind, it makes sense to think ahead and secure ourselves and our families from any eventuality. DLF Pramerica Life Insurance Companys protection plans provide you and your family with the financial security you need in case of unfortunate events like death or on the inability to earn due to physical disabilities. DLF Pramerica Family IncomeDestiny is not a matter of chance; it is a matter of choice. So, when it comes to your familys future why leave it to fate? The tomorrow of your family will take shape based on the decisions you take today. One right decision pays forever! Its in your hands to ensure that your family continues to have a safe and secure life even if you are not around. Its you who can ensure that despite your absence, your children grow up and fulfill their dreams and its for you to provide your wife a secure and hassle-free future. DLF Pramerica Family FirstYour family, as your biggest source of happiness, is the world around which most of your decisions revolve.You take care of all their needs - whether it is getting your children their favorite treats or giving them the best possible education, from an evening in the park to a week-long holiday. You want to give them all. Theres nothing youd like to deny them. Naturally, you would like them to have all this whether youre there with them or not. This is where DLF Pramerica Family First protection plan will be your support.

DLF Pramerica U-ProtectYour life is precious, more so for your family and your loved ones. You are the one who make their world perfect. You are the one who spread happiness in their lives. After all, you are the one who work tirelessly to make sure that the lives of your loved ones are comfortable and well taken care of. Although we leave no stone unturned to make sure that all the needs of our family are met, yet we often leave a very big aspect unattended the security of our family. In our busy lives, rarely do we pause for a moment and think of what would happen to our family in case something unfortunate was to happen. After all, life is full of uncertainties regarding the future and what it holds for us. Therefore, it becomes our duty as a responsible parent, a loving spouse or a dependable child to think ahead, plan and secure our family from any unfortunate happening. Child Progress PlansAs a parent you are the mainstay for building your childrens confidence through the care and support you provide them. Your most important responsibility is to secure your childs future financially so that all his/her needs are met - from education to his/her marriage. Our child insurance plans work as hard as you to realize your dreams for your child, with the financial security to help you enjoy life, knowing that you have taken care of your childs insurance needs. DLF Pramerica Fee Protect+As a parent you understand the importance of a proper school education in securing your childs future. While the school builds the foundation of all that your child will do in later life, helping you ensure the best possible education for your children is one of our highest priorities.

DLF Pramerica Fee ProtectAs a parent, you understand the importance of a proper school education for securing your childs future. That is the reason why you take extraordinary effort to ensure that your child gets the best possible schooling.While the school builds the foundation of all that your child will do in later life, helping you ensure the best possible education for your children is one of our highest priorities. DLF Pramerica Future Idols GoldAs parents, you ensure that your children receive two things. The first one is a strong foundation for them to become fine adults. The second is a gentle, affectionate environment for them to blossom in.As parents, you will always be concerned about your children's security and what they become tomorrow. The fact remains though, that you cannot foresee your children's future but you can help shape it.DLF Pramerica RakshakYour child looks up to you, as you are always there for him. You are his hero! Your child believes in you and looks up to you for many things. He sees you as someone caring and completely selfless. On your part, you put your heart and soul to ensure a great future for him. Just like DLF Pramerica Rakshak.Savings PlansYour dreams for your loved ones come in all shapes and sizes, from the smallest of wishes to the highest of aspirations. And helping them realize these dreams is where most of your efforts are directed. When it comes to making your savings plans you have to ensure that you have planned for everything from saving for a rainy day to taking your family abroad on a holiday, from buying a new car to buying a bigger house, from getting your wife a nice anniversary gift to getting your daughter married. DLF Pramerica Life Insurance protection plans have been designed keeping this in mind and you can rest assured knowing that you have ensured that your family gets the best that life and you can offer. DLF Pramerica Dhan SurakshaWe toil day in and day out so that our family can have a better tomorrow. We keep looking for opportunities to invest our hard earned money so our loved ones can have a brighter future. Thats why we need to plan our investments prudently so that the effort that we put in for the good/happiness of our family does not go waste. DLF Pramerica Dhan Suraksha gives you the key to strike the balance between maximum savings and protecting all that you have saved.DLF Pramerica Assure MoneyHave you ever noticed how those little things that you do bring the greatest of joys to your family? Like taking your kids out for an ice cream, or giving a bouquet to your wife, or getting your dad the latest book of his favorite author or, maybe, taking your mother to the temple over a weekend. Have you ever paused for a moment and wondered what makes these small gestures so special? It is because these small gestures constantly reinforce the belief that your family has in you that of your selfless love and care. From you, they get the assurance of a safe, secure and a steady life that is full of delight and happiness.

DLF Pramerica Wealth+ PremierYour family is your world and their well-being is your biggest concern. But life is full of unexpected twists. So, who will protect them when you are not there? Isnt it time you thought about their future and invested in a saving plan thats designed to give more family protection than any other?

DLF Pramerica Ezee Wealth+Life can get demanding at times and we often face our fair share of challenges - every day, every week, every month. From toiling hard for earning money to striving even harder for bringing happiness to our loved ones lives, we often find ourselves managing a lot of things that need our time and attention. As it is said, nothing in life comes easy. When it comes to investing in a savings plan to save for our family and secure their future, things look even more difficult. What if there was a solution that gave us the freedom to do just that?

DLF Pramerica Wealth + AceWhen we have a large sum of money, it is tempting to indulge ourselves with things that we so desire. While spending a little money from a windfall and enjoying a bit is only natural, it is far wiser to take advantage of it to plan and prudently build assets and investments that will secure your familys happiness for the times ahead. DLF Pramerica Wealth+ Ace helps you use any lump sum amount in one go, in the best way possible Just invest and forget!

DLF Pramerica Tatkaal Suraksha GoldTake a moment and think of a typical day in your life. From morning till evening, you are caught up in a hundred things that demand your time and attention. You, in turn do your best in managing all of these. In doing so, often the urgent gets priority over the important, and you keep postponing essential things. For instance, buying yourself a life insurance cover. However, when it comes to something as important as insuring your life can you afford to put it off for later? Or excuse yourself from it simply because you dont have time? Certainly not!

DLF Pramerica Income RakshakEducating your children, meeting your familys everyday expenses or renovating the house. Responsibilities grow with each day as time passes by. This is why DLF Pramerica brings you Income Raksha

MEANING OF ULIP

A policy, which provides for life insurance where the policy value at any time varies according to the value of the underlying assets at the time. ULIP is life insurance solution that provides for the benefits of protection and flexibility in investment. The investment is denoted as units and is represented by the value that it has attained called as Net Asset Value (NAV).

Unit linked insurance plans Units in funds Underlying investment

A ULIP structure looks like as follows:

Contribution

Less chargeInvestment represented as unitsLife cover

FEATURES OF ULIP

ULIP distinguishes itself through the multiple benefits that it provides to the consumer. The plan is a one-stop solution providing:

Life protection Investment and Savings Flexibility- Adjustable Life Cover- Investment Options Transparency Options to take additional cover against- Death due to accident- Disability- Critical Illness- Surgeries Liquidity Tax planning

The two strong arguments in favour of unit-linked plans are: Firstly, the investor knows exactly what is happening to his money Secondly it allows the investor to choose the assets into which he wants his funds invested.An investor in a ULIP knows how much he is paying towards mortality, management and administration charges. He also knows where the insurance company has invested his money.The investor gets exactly the same returns that the fund earns but he also bears the investment risk. The transparency makes the product more competitive. So if you are willing to bear the investment risks in order to generate a higher return on your retirement funds ULIPs are for you. Traditional with profits policies too invest in the market and generate the same returns prevailing in the market. But here the insurance company evens out returns to ensure that policyholders do not hold money in a bad year. In that sense they are safer. ULIPs also offer flexibility. For instance a policyholder can ask the insurance company to liquidate units in his account to meet to mortality charges if he is unable to pay any premium installment. This eats into savings but ensures that the policy will continue to cover his life.ULIP came into play in the 1960s and became very popular in Western Europe and Americas. The reason that is attributed to the wide spread popularity of ULIP is because of the transparency and the flexibility which it offers. Unit- linked plans are a contemporary product: transparent and flexible. Individuals have greater control over their investments. The popularity of ULIPS stems from the fact that they offer customers integrated financial solutions with a transparent charge structure. In todays times, ULIP provides solutions for insurance planning, financial needs, financial planning for childrens future and retirement planning. Unit-linked insurance plans (ULIPs) have become something of a rage with their 'promise' of market-linked returns combined with the dual benefit of insuring your life from eventualities.

Why do insurers prefer ULIPs?

Insurers love ULIPs for several reasons. Most important of all, insurers can sell these policies with lesser capital of their own than what would be required if they sold traditional policies. In traditional with profits policies the insurance company bears the investment risk to the extent of insured amount. In ULIPs the policyholder bears most of the investment risk. Since ULIPs are designed to mobilize savings, they give insurance companies an opportunity to get a large chunk of asset management business which has been traditionally dominated by mutual funds. ULIPs are suitable for individuals who are already adequately insured and are reasonably well-informed and savvy to take active investment decisions by using the `switch option' that is provided to a ULIP policyholder. Also policyholders with regular endowment plans who are not satisfied with the 4-6% returns can consider taking a ULIP with a lower equity component. It is best if insurance-seekers tread the middle path and choose balanced plans (with about 50-60% equity component). Ideally they need to avoid taking the aggressive 100% equity ULIP, which could needlessly expose their assets to market volatility. So if insurances-seekers/investors play their cards right, they can make this marriage work.

WORKING OF UNIT LINKED INSURANCE PLANS UNIT LINKED PLANS

SUPER SMART KIDSmartKid offers an exclusive choice of 3 education insurance plans: SmartKid New Unit-linked Regular Premium, SmartKid New Unit-linked Single Premium and SmartKid Regular Premium. Take a look at the features and benefits of each plan:1. SmartKid New Unit-linked Regular Premium SmartKid New Unit-linked Regular Premium is a unit-linked plan, which enables you and your child to accumulate wealth by virtue of the performance of the underlying market-linked instrument. Take a look at the features of the plan:

Premium: The minimum premium to be invested is Rs. 10,000 per annum. After deducting premium allocation charges from the premium, the remaining amount will be invested in a fund of your choice.

Sum Assured: The minimum Sum Assured that the policyholder can opt for is Term * Annual Premium/2, subject to a minimum of Rs 1 Lac Policy term: The term of the policy will be calculated as the difference between your child's current age and the age of your child when the policy matures.

Mortality, Policy Administration charges: These and other charges will be deducted from the units in the fund.2. SmartKid New Unit-linked Single PremiumSmartKid New Unit-linked Single Premium works in much the same way as SmartKid New Unit-linked Regular Premium policy mentioned above. The only different feature is the premium amount-you will be required to pay only a single premium, which starts at as low as Rs. 50,000.

Additional Features and Benefits Common to All 3 Plans

Regular payouts: As your child approaches key educational milestones such as 12th standard or graduation exams, he or she will receive regular payouts, guaranteeing he or she continues to study, no matter what the circumstance.

Death Benefit: Your child will receive the Sum Assured immediately, should something happen to youDLF Pramerica will pay the remaining premiums, ensuring your child continues to receive policy benefits, as always.

Income Benefit Rider: You can choose to add the benefits of this rider to your child's education plan. Should you depart before your son's or daughter's education is complete, you child will receive 10% of Rider Sum Assured, for the balance term of the policy.

Add-on riders: 'Accidental Death and Disability Rider' and 'Waiver of Premium Rider' ensure your child stays doubly protected, at all times. You can choose to add these to your child's education policy.

Tax benefits: Premiums you pay for a SmartKid policy are eligible for tax savings [u/s 80(C)]. Maturity and death benefits are eligible for tax exemptions [u/s 10(10D)].3. SmartKid Regular PremiumFlexible investment option: Choose the amount of premium with which you wish to safeguard your child's education.

Flexible policy tenure: The tenure of the plan will be calculated as the difference between your child's current age and his or her age at which the policy matures.

Flexible premium options: The premium will be calculated based on 3 factors: Sum Assured, policy tenure and your age. Guaranteed bonus: A guaranteed bonus of 3.5% per annum is declared for the first 4 premium paying years plus an annual vested bonus declared in subsequent years.

ROLE OF AN ADVISOR IN UNIT LINKED INVESTMENT PLANS

It is important for us to know that what is the role that an advisor will play. At DLF Pramerica, you are an advisor is to

1. Provide ongoing financial advice for his/her clients: You are an advisor and just like a lawyer or a doctor you advice the client about insurance and finance.2. Identify future clients: Life insurance is a business of contacts an the advisor constantly need to know people so that his business expands.3. Constantly make appointments: Just making contacts will not be enough to develop a good life insurance business.4. Advisor needs to meet these contacts and thus should make appointments on constantly.5. Conduct financial review meetings with prospects/ clients: As an advisor it is necessary to meet with client not only for the purpose of selling but also to review the need of the client and prospects. Many people would not be in for life insurance today but as time moves they can be requiring one. Similarly an existing client may also be in need of more insurance as responsibilities and liabilities increase.

Close sale:

Ultimately success is defined as sales. The advisor should lead each appointment towards a sale and close it effectively where in the client is happy on purchasing the insurance solution and feels satisfied with it.

OBJECTIVE OF THE STUDY

The project undertaken by me as a part of my Summar Training of M.B.A.course is an effort made to study the ULIP policies and activities in DLF PRAMERICA with special emphasis on unit linked products of the company.In this era of cut throat competition, any organization needs to select and retain the best talent. People selected should have positive attitude, ability to inspire others and must be dynamic.

The main objectives of this study are: To study about the ULIP plans of both companies To study about the awareness of the customer regarding the ULIP plan To study about the need of the customer To study about the factor which affect the customer to invest in ULIP plan

RESEARCH METHODOLOGY

Research Methodology has many dimensions, it include not only research methods but also considers the logic behind the methods used in the context of the study and explains why only a particular method of technique had been used so that research lend themselves to p[roper evaluations. Thus in a way it is a written game plan for concluding research therefore in order to solve research problem it is necessary to design a research methodology for the problem as the same may differ from problem to problem. Research design is the conceptual structure within which the research is conducted. Its functions are to provide for the collection of relevant evidence with minimum expenditure of effort, time and money. But, how this can be achieved depends on the research purpose. In my study the research purpose is exploratory study i.e. to gain familiarity with phenomena or to achieve new insights in it.

MARKET RESEARCH DESIGN : Descriptive typeDATA SOURCES : Primary sourceRESEARCH APPROACH : Survey methodRESEARCH INSTRUMENT : QuestionnaireTYPE OF QUESTIONS : Close-endedSAMPLE SIZE : 100 samplesMODE OF COLLECTING DATA: Respondents to be chosen randomly.

SAMPLE DESIGN: Social phenomenon being very vast, it becomes impossible to contact each and every individual of population due to limitation of essential resources like time and money. Therefore, the study is preferably narrowed down to a representative sample to make the study more manageable. Quota sampling is adopted in the exploratory study. It is a non-probability study in which various insurance players are taken.

SAMPLING UNIT:The data can be collected from primary sources. The basic premises of my study are primary data but at the same time it is supplemented with the secondary data. SAMPLING SIZE: It refers to the number of items to be selected from the universal, to constitute a sample. To commence the study various insurance players are taken.HOW DID I GO ABOUT THE PROJECT:-SAMPLE SIZE A sample size of 100 customers was selected to do this project, which was random sampling keeping in mind the basic criteria.FIELD WORKThe research was done for a period of 2 months in (students, government employee & other) ambala. I started with MY MARKET 100 and thereafter I used to give cold calls from the companys database and if seemed interested I take along with me the representatives of the company for further information gathering.1) Study of Secondary Data: The quickest and the most economical way for researchers to find possible hypothesis is to take the advantage of the work done earlier and thus utilize their efforts. 2) In-depth Interviews: I used in-depth interviews because it attempts to influence respondents to talk freely about their subject of interest .A formal questionnaire was made and according to which the questions were asked to the respondents.Basic methods of collecting Primary Data: 1) Questionnaire Method: The questionnaire used by me for the purpose of data collection were of structured type (Non-disguised).2) Contact Method: In order to derive information from the intended organization, it was elementary for me to search for a link which could enable me to conduct a research in that organization

DATA ANALYSIS & INTERPRETATION

1). Are you interested in products offered by the DLF PRAMERICA?YES61%

NO22%

WILL THINK17%

INTERPRETATIONIt shows that 61% people are interested in buying a product of DLF pramerica, 17% people are not interested & 22% will think about buying a product DLF pramerica.

2). Are you satisfied with your present insurer?

YES65%

NO35%

INTERPRETATIONIt shows that 65% people are satisfied with their present insurer and 35% people are not satisfied with their present insurer.

3).Where would you like to insure if given chance? LIC60%

SBI8%

TATA AIG15%

ICICI10%

BAJAJ5%

KOTAK MAHINDRA2%

NO OF PEOPLE

COMPANIESSSSSSSS

INTERPRETATIONIt shows that 60% people are insure in LIC, 8% people are insure in SBI, 15% people are insure TATA AIG , 10% people are insure in ICICI , 5% people are insure in BAJAJ , 2% people are insure in KOTAK MAHINDRA .

4). What is peoples main concern while taking a insurance policy (ULIP)?

SECURITY40%

RETURNS25%

TAX REBATE35%

INTERPRETATION:In above chart ,it show that out of 100 respondents, 40% of the respondent concern the security purpose while purchasing the insurance policy, 25% of the respondents concern returns purpose while purchasing the insurance policy , 35% of the respondent consider the tax rebate while purchasing the insurance policy.

5). Are you aware of Lifetime Super introduced by DLF PRAMERICA?

YES58%

NO42%

INTERPRETATIONIt shows that 58% respondent are aware from the products of DLF , 42% people are not aware from the products of DLF.

6. What is your perception about the Unit link insurance plans, are they give you a sense of security?

YES55%

NO45%

INTERPRETATION:It shows that 55% people are think that ULIP plan provided the sense of security , 45% people are think that ULIP plan not provided the sense of security.

7) Do you know how a Unit Linked Insurance Plan works?

YES15%

NO85%

INTERPRETATION:It shows that 15% respondent are know the working of ULIP plan , 85% respondent are not know the working of ULIP plan.

8) Can you please highlight risk attached with them?

HIGH70%

MODERATE15%

LOW15%

INTERPRETATION:It shows that 70% respondents are think that there is high risk in ULIP plan ,15% respondent think that there is moderate risk in ULIP plan , 15% respondent think that there s low risk in ULIP plan .

9) Are you aware of Lifetime pension plan introduced by DLF PRAMERICA ?

YES65%

NO35%

INTERPRETATION:It shows that 65% respondent is aware from pension plan of ULIP plan. 35% respondents are not aware from pension plan of ULIP plan.

10) Are you interested in buying products of DLF PRAMERICA?

YES65%

NO35%

INTERPRTATION:It shows that 65% respondents are interested to buy the product of DLF products, 35% respondents are not interested to buy the DLF products.

Findings:

After completing the study following points can be drawn:

1. DLF Pramerica Life Insurance Company Limited is one of the top 100 best companies to work with for 2011-12.2. It has the limited insurance products which is having flexibility to meet the customers requirement and expectation.3. DPLI entered the market with aggressive marketing and supported by after sale services with the help of technology. 4. DPLI offers the policies with the guaranteed returns to its client and ensures that the customer rights should be protected.5. DPLI have a good brand image in the market due to DLF, i.e. its associated partner which gives the benefit of building trust among people in the market.6. It has a skilled and trained workforce that is its greatest strength. So they are provided with the excellent working environment.

RECOMMENDATIONS

More emphasis should be on promotional activities. Plenty of advertisement should be done through T.V, Newspaper and Radio as these medias are having maximum recall value. Total financial planning and advice should be given to every customer. More business opportunity seminars should be conducted to make people aware of the offer given. The company should quite frequently send their agent to the customer so that they should be aware of the latest offer. The company should attempt to open more and more of its branches in the country so as to promote their product publicity

CONCLUSION

LIC enjoys credibility over other private players in the industry People look for security over returns in market linked plans .Lifetime is the most popular product among the people who are aware about DLF PRAMERICAs products. People are now showing more interest in ULIP as compared to some of the traditional plans.

DLF PRAMERICA has to counter the distribution network of LIC .The product profile of DLF PRAMERICA is not very comprehensive

It shows that maximum number of respondents are aware of the products of DLF PRAMERICA . As the number of people are wishes to go with or to buy the LIC product as their minds are set . Some main factors which are affect to the customer to buy the ULIP plan that is for short time ( 5 years) .So that it is prefer by the person who are free from their responsibility52