INTRODUCTION To make comparison of ULIP plans with Mutual funds in Bajaj Allianz Life Insurance Co. Ltd.

and to Create awareness about Unit Linked Insurance Plan (ULIP) Benefits. The overall goal of this project was to create awareness about investments. The Above problem arises because every life insurance company has their products having different positive and negative aspects. Life Insurance is booming sector in today s economy. So the responsibilities of the insurance companies have been increased as compare to the past. Because in past people were taking insurance policies for protection tool only. In present scenario insurance sector is providing more services with the basic life insurance. Bajaj Allianz Life Insurance has number of products, which gives the right way to save the money and earn good profit by invested premium. Today people want more services and more return on their investment. So this insurance company is providing more value added services with the basic insurance operation. By doing this type of study in this Insurance sector and looking at the vast scope and opportunity to study this booming field of Life Insurance and the growing awareness among the public regarding insuring their life through Life insurance policies as well as the growing contribution of Insurance in GDP of country with the number of private players making entrance in this booming industry of Insurance. A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities. The income earned through these investments and the capital appreciations realized are shared by its unit holders in proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. OBJECTIVES: To understand the reason for which customers prefer ULIP as one of the best insurance investment mode rather than Mutual fund. To find the significance difference between customers of different income with that of investment mode. To Compare Investment Options of customers in ULIPs and Mutual Funds. LIMITATIONS: The middle class people do not know basic concept of ULIP so creating awareness is a big challenge for me. The finding of my research is from a small sample size. Narrow minded thinking of middle class people as investment is not their cup of tea.

Many customers are thinking that investment in share market is very risky. As ULIP and Mutual fund both are related to share market. A general preference to LIC and SBI over private players. Hesitations on the part of respondents to disclose financial information. INDIAN INSURANCE INDUSTRY The history of life insurance in India dates back to 1818 when it was conceived as a means to provide for English Widows. Interestingly in those days a higher premium was charged for Indian lives than the non-Indian lives as Indian lives were considered more riskier for coverage. The Bombay Mutual Life Insurance Society started its business in 1870. It was the first company to charge same premium for both Indian and non-Indian lives. The Oriental Assurance Company was established in 1880. The General insurance business in India, on the other hand, can trace its roots to the Triton (Tital) Insurance Company Limited, the first general insurance company established in the year 1850 in Calcutta by the British. Till the end of nineteenth century insurance business was almost entirely in the hands of overseas companies. Insurance regulation formally began in India with the passing of the Life Insurance Companies Act of 1912 and the provident fund Act of 1912. Several frauds during 20's and 30's sullied insurance business in India. By 1938 there were 176 insurance companies. The first comprehensive legislation was introduced with the Insurance Act of 1938 that provided strict State Control over insurance business. The insurance business grew at a faster pace after independence. Indian companies strengthened their hold on this business but despite the growth that was witnessed, insurance remained an urban phenomenon. The Government of India in 1956, brought together over 240 private life insurers and provident societies under one nationalized monopoly corporation and Life Insurance Corporation (LIC) was born. Nationalization was justified on the grounds that it would create much needed funds for rapid industrialization. This was in conformity with the Government's chosen path of State lead planning and development. The (non-life) insurance business continued to thrive with the private sector till 1972. Their operations were restricted to organized trade and industry in large cities. The general insurance industry was nationalized in 1972. With this, nearly 107 insurers were amalgamated and grouped into four companies- National Insurance Company, New India Assurance Company, Oriental Insurance Company and United India Insurance Company. These were subsidiaries of the General Insurance Company (GIC).The general insurance business was nationalized after the promulgation of General Insurance Business (Nationalizations) Act, 1972. The post-nationalization general insurance business was undertaken by the General Insurance Corporation of India (GIC) and its 4 subsidiaries: Oriental Insurance Company Limited; New India Assurance Company Limited; National Insurance Company Limited; and United India Insurance Company Limited. Some of the important milestones in the life insurance business in India is:

1850 Non life insurance debuts with triton insurance company. 1870: :Bombay mutual life assurance society is the first Indian owned life insurer 1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business. 1928 : :The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses. 1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public. 1956: 245 Indian and foreign insurers and provident societies taken over by the central government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 Crore from the Government of India. The General insurance business in India, on the other hand, can trace its roots to the Triton Insurance Company Ltd., the first general insurance company established in the year 1850 in Calcutta by the British. Some of the important milestones in the general insurance business in India are: 1907: The Indian Mercantile Insurance Ltd. set up, the first company to transact all classesof general insurance of India 1957 : General Insurance Council, a wing of the Insurance Association of India, frames a code of conduct for ensuring fair conduct and sound business practices. 1968 : The Insurance Act amended to regulate investments and set minimum solvency margins and the Tariff Advisory Committee set up.

1972 : The General Insurance Business (Nationalization) Act, 1972 nationalized the general insurance business in India with effect from 1st January 1973. 107 insurers amalgamated and grouped into four companies viz. the National Insurance Company Ltd., the New India Assurance Company Ltd., the Oriental Insurance Company Ltd. and the United India Insurance Company Ltd. GIC incorporated as a company. 1993: Malhotra Committee- headed by former Finance Secretary and RBI Governor R.N. Malhotra- was formed to evaluate the Indian insurance industry and recommend its future direction. The Malhotra committee was set up with the objective of complementing the reforms initiated in the financial sector. 1997 : Insurance regulator IRDA set up. 2000: IRDA starts giving licenses to private insurers:Kotak Life Insurance ,ICICI potential and HDFC standard Life insurance are the first private insurers to sell a policy. 2001: Royal SundaramAlliance first non life insurer to sell a policy 2002 Banks allowed to sell insurance plans. INSURANCE MARKET PRESENT The insurance sector was opened up for private participation seven years ago. For years now, the private players are active in the liberalized environment. The insurance market have witnessed dynamic changes which includes presence of a fairly large number of insurers both life and non-life segment. Most of the private insurance companies have formed joint venture partnering well recognized foreign players across the globe. LIFE INSURANCE COMPANIES Sl. No. Insurer Foreign Partners 1 HDFC Standard Life Insurance Co. Ltd. Standard Life Assurance, UK 2 Standard Life Assurance, UK New York Life, USA 3 ICICI-Prudential Life Insurance Co. Ltd.Prudential , UK 4 Om Kotak Life Insurance Co. Ltd. Old Mutual, South Africa 5 Birla Sun Life Insurance Co. Ltd. Sun Life, Canada 6 Tata-AIG Life Insurance Co. Ltd. American International Assurance Co., USA 7 SBI Life Insurance Co. Ltd. BNP Paribas Assurance SA, France 8 ING Vysya Life Insurance Co. Ltd. ING Insurance International B.V., Netherlands 9 Allianz Bajaj Life Insurance Co. Ltd. Allianz, Germany 10 Metlife India Insurance Co. Ltd. Metlife International Holdings Ltd., USA 11 Reliance Life Insurance Co. Ltd. 12 AVIVA Aviva International Holdings Ltd., UK 13 Sahara Life Insurance Co. Ltd. 14 Shriram Life Insurance Co. Ltd. Sanlam, South Africa K

15 Bharti AXA Life Insurance Co. Ltd. AXA Holdings, France 16 Future Generali India Life Insurance Company Ltd Pantaloon Retail Ltd.; Sain Marketing Network Pvt. Ltd. (SMNPL), Generali, Italy 17 IDBI Fortis Life Insurance Company Ltd.Fortis, Netherlands 18 Canara HSBC OBC Life Insurance Company Ltd. HSBC, UK 19 Aegon Religare Life Insurance Company Ltd. Religare, Netherlands 20 DLF Pramerica Life Insurance Co. Ltd. Prudential of America, USA 21 Life Insurance Corporation of India TOP 10 LIFE INSURANCE COMPANIES IN INDIA LIC (Life Insurance Corporation of India) still remains the largest life insurance company accounting for 64% market share. Its share, however, has dropped from 74% a year before, mainly owing to entry of private players with innovative products and better sales force. ICICI Prudential Life Insurance Co Ltd is the biggest private life insurance company in India. It experienced growth of 58% in new business premium, accounting for increase in market share to 8.93% in 2007-08 from 6.97% in 2006-07. Bajaj Allianz Life Insurance Co Ltd has reported a growth of 52% and its market share went up to 6.98% in 2007-08 form 5.66% in 2006-07. The company ranked second (after LIC) in number of policies sold in 2007-08, with total market share of 7.36%. SBI Life Insurance Co Ltd in terms of new number of policies sold, the company ranked 6th in 2007-08. New premium collection for the company was Rs 4,792.66 crore in 2007-08, an increase of 87% over last year.

Reliance Life Insurance Co Ltd Total collected was Rs 2,792.76 crore and its market share went up to 2.96% from 1.23% a year back. It now ranks 5th in new business premium and 4th in number of new policies sold in 2007-08. HDFC Standard Life Insurance Co Ltd with an income of Rs 2,680 crore in FY2007-08, registering a year-on-year growth of 64%. Its market share is 2.88% and it ranks 6 th among the insurance companies and 5th amongst the private players. Birla Sun Life Insurance Co Ltd market share of the company increased from 1.22% to 2.11% in 2007-08. Max New York Life Insurance Co Ltd has reported growth of 73% in 2007-08. Total new business generated was Rs 641.83 crore as against Rs 387.51 crore. Kotak Mahindra Old Mutual Life Insurance Ltd the fiscal 2007-08, the company reported growth of 80%, moving from the 11th position to 9th. It captured a market share of 1.19% in 2007-08. Aviva Life Insurance Company India Ltd ranking dropped to 10th in 2007-08 from 9th last year. It has presence in more than 3,000 locations across India via 221 branches and close to 40 banc assurance partnerships. Aviva Life Insurance plans to increase its capital base by Rs 344 crore. MARKET SHARE OF VARIOUS LIFE INSURANCE COMPANIES IN INDIA Here is the market share of various Life Insurance Companies in India at the end of FY2008. Company Name Market Share(in %) LIC 48.1% ICICI Prudential 13.7%

Bajaj Allianz 10.3% SBI Life 6.2% HDFC Standard 4.1% Birla Sunlife 3.4% Reliance Life 3.4% Max New York 2.4% OM Kotak 1.9% AVIVA 1.8% Tata AIG 1.5% MetLife 1.4% ING Vysya 1.2% Shriram Life 0.3% Bharti Axa Life 0.2%

BOOMING INSURANCE MARKET IN INDIA With a huge population base and large untapped market, insurance industry is a big opportunity area in India for national as well as foreign investors. India is the

fifth largest life insurance market in the emerging insurance economies globally and is growing at 3234% annually. This impressive growth in the market has been driven by liberalization, with new players significantly enhancing product awareness and promoting consumer education and information. The strong growth potential of the country has also made international players to look at the Indian insurance market. Moreover, saturation of insurance markets in many developed economies has made the Indian market more attractive for international insurance players This research report will help the client to analyze the leading-edge opportunities critical to the success of insurance industry in India. Based on this analysis, the report gives a future forecast of the market that is intended as a rough guide to the direction in which the market is likely to move. Total life insurance premium in India is projected to grow Rs 1,230,000 Crore by 2010-11. Total non-life insurance premium is expected to increase at a CAGR of 25% for the period spanning from 2008-09 to 2010-11. With the entry of several low-cost airlines, along with fleet expansion by existing ones and increasing corporate aircraft ownership, the Indian aviation insurance market is all set to boom in a big way in coming years. Home insurance segment is set to achieve a 100% growth as financial institutions have made home insurance obligatory for housing loan approvals.

Health insurance is poised to become the second largest business for non-life insurers after motor insurance in next three years. A booming life insurance market has propelled the Indian life insurance agents into the top 10 country list in terms of membership to the Million Dollar Round Table (MDRT) an exclusive club for the highest performing life insurance agents. COMPANY PROFILE Bajaj Allianz Life Insurance is a union betweenAllianz SE, one of the largest Insurance Company and BajajFinserv. Allianz SE is a leading insurance conglomerate globally and one of the largest asset managers in the world,managing assets worth over a Trillion(Over INR 55,00,000 Crores).Allianz SE has over 115 years of financial experience and is present in over 70 countries around the world. At Bajaj Allianz Life Insurance, customer delight is the guiding principle. Their business philosophy is to ensure excellent insurance and investment solutions by offering customized products, supported by the best technology. VISION To be the first choice insurer for customers To be the preferred employer for staff in the insurance industry. To be the number one insurer for creating shareholder value. MISSION As a responsible, customer focused market leader, we will strive to understand the insurance needs of the consumers and translate it into affordable products that deliver value for money. Accelerated Growth Fiscal Year No. of policies sold New Business in FY 2001-2002(6 mths) 21,37 Rs. 7 cr. 2002-2003 1,15,965 Rs. 63.3 cr. 2003-2004 1,86,443 Rs. 180 cr. 2004-2005 2,88,189 Rs. 857 cr. 2005-2006 7,81,685 Rs. 2,717 cr. 2006-2007 20,79,217 Rs. 4,302 cr. 2007-2008 37,44,742 Rs. 6,674 cr. Bajaj Allianz General Insurance received the Insurance Regulatory and Development Authority (IRDA) certificate of Registration on 2nd May, 2001 to conduct General Insurance business (including Health Insurance business) in India. The Company has an authorized and paid up capital of Rs 110 crores. Bajaj Finserv Limited holds 74% and

the remaining 26% is held by Allianz, SE. As on 31st March 2009, Bajaj Allianz General Insurance maintained its premier position in the industry by achieving growth as well as profitability. The company garnered a premium income of Rs. 2866 crore, achieving a growth of 11 % over the last year. Bajaj Allianz has made a profit before tax of Rs. 149.8 crore and has become the only private insurer to cross the Rs.100 crore mark in profit before tax in the last two years. The profit after tax was Rs.95 crores, which is also the highest by any private insurer. The company ranked second (after LIC) in number of policies sold in 2007-08, with total market share of 7.36%. RESULTS FOR CURRENT FY TILL 31ST DECEMBER 2008 The Gross Written Premiums (GWP) for the nine months ended on 31st Dec 2008, is Rs 6726 crores as compared to Rs 5219 crores in the corresponding period of the previous year - growth of 29%. New Business premium for the nine months ended on 31st Dec 2008 is Rs. 3003 crores as compared to Rs. 3780 crores in the corresponding period of previous year

Commission on new business premium, which was 27% during nine months ended on 31st Dec 2007, came down to 20% during the current period. Operating expenses came down to 20% of GWP for the current period of nine months ended on 31st Dec 2008 as compared to 26% for the corresponding period of previous year. The Company posted a profit of Rs 364 lacs for the period ended 31st Dec 2008 as compared to a profit of Rs 5358 lacs in the corresponding period of the previous year. The policyholder surplus is Rs 15514 lacs (corresponding period of previous year Rs 18681 lacs) and the shareholders loss stands at Rs 15150 lacs (corresponding period of previous year: Rs 13323 lacs). Number of policies underwritten during the nine months ended 31st Dec 2008 were 18,08,495 (corresponding period of the previous year 23,62,496). Policies in force as on 31 st Dec 2008 is around 70 lacs. The company ranked second (after LIC) in number of policies sold in 2007-08, with total market share of 7.36%. The share capital (including share premium) is Rs. 1211 crores as on 31st December 2008. The solvency as on 31 st Dec 2008 stands at 261% (required solvency is 150%). During the period ended 31st Dec 2008, no additional capital has been infused. Despite challenging environment, the company has been able to not only reduce commission but also operating expenses. The solvency margin of the company continues to be very strong. As on 31st Dec 2008, the Company employed on roll 22,129 staff as against 20,764 staff at 31st March 2008.The Company operates out of 1,138 offices as on 31 Dec 2008. Products profile: Unit inked plan y y y New family gain New unit gain plus New unit gain premier

Traditional plan y y Invest gain Cash gain

Child gain

Retirement solutions y y Swarna visranthi New unit gain easy pension plus

Health plan y y Care first Health care

Term plan y y Risk care Term care

UNIT LINKED INSURANCE POLICY (ULIP)