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mba project report

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  • 1. PROJECT REPORTONA Comparative Analysis of ULIP of Bajaj Allianz LifeInsurance Co. Ltd with Mutual Fund FORPARTIAL FULFILMENTOFMASTERS OF BUSINESS ADMINISTRATION (2011-2013) UNDER THE GUIDANCE OF Mrs. Rajinder Kaur (Asst. Professor)Submitted To:Submitted By:Mrs. Rajinder Kaur Harmanjot KaurAsst. ProfessorMBA 4th Sem. 1174471 MALOUT INSTITUTE OF MANAGEMENT & INFORMATION TECHNOLOGY1

2. (Affiliated to PTU, Jalandhar) DECLARATION I, Harmanjot Kaur, do hereby declare that this project work entitled AComparative Analysis of ULIP of Bajaj Allianz Life Insurance Co. Ltd with MutualFund is an outcome of my study and is submitted in partial fulfillment of therequirement for the award of the degree of Master of Business Administration, MIMIT,Malout, and Punjab Technical University. I also declare that this report has not been submitted by me fully or partially forthe award of any degree, diploma, title, recognition or any other fellowship of any otheruniversity before.HARMANJOT KAUR2 3. ACKNOWLEDGEMENT It is my pleasure to place on record my sincere gratitude towards my project guide Mrs.RAJINDER KAUR (Asst Prof.) who spent her precious time providing continuous ideasand expert guidance to my Report work. It was her direction and encouragement at everymoment and step that motivated me to steer the research work confidently andsuccessfully.I would like to acknowledge my sincere thanks to Mrs. JIWAN JYOTI MAINI, whogave me an opportunity to carry out this project and had been a constant inspiration. I am also thankful to all faculty of Management Department, who encouraged,gave moral support and valuable guidance whenever needed, which has been a source ofinspiration to me. Last but not the Least, I would like to thank my friends who directly or indirectlyhelped me in completing this Project in time.3 4. INDEXSerial No.PARTICULARSPage No.1CHAPTER5-10 Executive summary Introduction Literature Review Objectives Research Methodology Limitations2CHAPTER11-52 Industry Introduction Company Profile Ulips Mutual Funds Ulips vs. Mutual Funds3CHAPTER53-79 Data Analysis & Interpretations4CHAPTER80-84 Findings Conclusion Bibliography5CHAPTER85-87 Appendix Questionnaire4 5. CHAPTER 1. EXECUTIVE SUMMARYA comparative Analysis of ULIP plans of Bajaj Allianz Life Insurance with mutualfunds an analysis to be done be by Harmanjot Kaur student (MBA) of MIMIT, Malout.Total Investment scenario is changing, in past people were not interested in investmentbecause there were no good options available for investment. Now there are manyoptions available for investment like life Insurance, Mutual fund, Equity market, Realestate, etc.Today people want more services and more return on their investment. So, most of theinsurance companies are providing more value added services with the basic insuranceoperation.Another option for investment available is Mutual Fund. Mutual Funds are providinggood returns. So while investing people tend more to words mutual fund as they areproviding more returns than Insurance also, with a good investment portfolio. Mutualfund companies are providing more liquidity.The project was taken to know about, what are the main aspects in Bajaj Allianz LifeInsurance Company, and its USP (Unique Selling Preposition).Which gives it highestbusiness and customers. Customers always prefer to invest in a good option and in acompany which is market leader.After survey and analysis I came to know that most of the people go for ULIP insurancepolicies to cover the risk of life, and invest it in a good Portfolio but there is big portionof customers have taken the policies to save the taxes. And people are aware about thetax benefits they get for insurance policies. Therefore, while investing in any Investmentoption investor checks whether his money is safe or not, Mutual funds provides goodreturns but investments are directly exposed to risk. As in ULIP returns are related to5 6. stock market but they are having some insurance benefit and IRDA regulates theinvestment.Many people are getting the tax benefits in ULIP. In Mutual Fund they have to investtheir money in tax saving funds to get the tax benefit.INTRODUCTIONTo make comparison of ULIP plans with Mutual funds in Bajaj Allianz Life InsuranceCo. Ltd. and to Create awareness about Unit Linked Insurance Plan (ULIP) Benefits. Theoverall goal of this project was to create awareness about investments. The Aboveproblem arises because every life insurance company has their products having differentpositive and negative aspects.Life Insurance is booming sector in todays economy. So the responsibilities of theinsurance companies have been increased as compare to the past. Because in past peoplewere taking insurance policies for protection tool only. In present scenario insurancesector is providing more services with the basic life insurance. Bajaj Allianz LifeInsurance has number of products, which gives the right way to save the money and earngood profit by invested premium. Today people want more services and more return ontheir investment. So this insurance company is providing more value added serviceswith the basic insurance operation.By doing this type of study in this Insurance sector and looking at the vast scope andopportunity to study this booming field of Life Insurance and the growing awarenessamong the public regarding insuring their life through Life insurance policies as well asthe growing contribution of Insurance in GDP of country with the number of privateplayers 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 acommon financial goal. The money thus collected is then invested in capital marketinstruments such as shares, debentures and other securities. The income earned throughthese investments and the capital appreciations realized are shared by its unit holders inproportion to the number of units owned by them. Thus a Mutual Fund is the mostsuitable investment for the common man as it offers an opportunity to invest in adiversified, professionally managed basket of securities at a relatively low cost. 6 7. REVIEW OF LITERATUREMr.Madhu T, made a study on ULIPs hold edge over mutual funds. The findings showsthat distributors would push unit linked insurance plans (ULIPs) to earn bettercommission. ULIPs offer attractive front-end commissions to agents. However,independent financial advisors believe that though there is a possibility of somedistributors favoring ULIPs in the short term, the new directive would be beneficial forboth the industry and investors in the long run. (Mr.Madhu T, The Economic Times, June2009).Mr. Deepak Shenoy ,in his article Comparing ULIP returns to Mutual Funds, he revealsthat, over the last three years, their growth mutual fund has given better returns than the"MAXIMISER" option of their ULIPs.(Deepak Shenoy, The Indian Investors Blog,August 2006).Mr.Murthaza and Sony, in their article An Overview on ULIP, This article is an initiativefrom Bajaj Allianz to create better understanding of ULIPs and its benefits so thatinvestors can avail maximum returns from their investments.Mr.Bernz Jayma P, made a study on Mutual Fund disadvantages. He suggested that, ifyoure new to stock market investing you may have heard that mutual funds would be agood way for you to get started. Thats actually good advice, but mutual funds have theirown pitfalls to watch out for.7 8. OBJECTIVES OF STUDY To compare ULIPs with Mutual Funds. To understand the reason for which customers prefer ULIP as one of the bestinsurance investment mode rather than Mutual fund. To Compare Investment Options of customers in ULIPs and Mutual Funds.. 8 9. RESEARCH METHODOLOGYDATA COLLECTION: In this study two types of data is used:-Primary DataSecondary DataPrimary Data: - Primary data is that type of data which is collected for first time by the researcher himself. I have collected primary data for my study by using structured questionnaire that is filled by respondents.Secondary Data: - Secondary data is already collected by someone for his own purpose. I have used secondary sources like internet websites, magazines, newspapers, pamphlets, and brouchers.RESEARCH DESIGN: Descriptive & Analytical Research is used to drawconclusions from available information.SAMPLE DESIGN:Sample Size -50Sampling Technique - Convenience SamplingDATA ANALYSIS TOOLS: o Tables o Pie-Charts 9 10. o Percentage analysisLIMITATIONS The findings of my research are from a small sample size. The middle class people do not know basic concept of ULIP so creatingawareness is a big challenge for me. Hesitations on the part of respondents to disclose financial information. The study was limited only to Bajaj Allianzunit linked policies.10 11. CHAPTER 2.INDIAN INSURANCE INDUSTRYThe history of life insurance in India dates back to 1818 when it was conceived as ameans to provide for English Widows. Interestingly in those days a higher premium wascharged for Indian lives than the non-Indian lives as Indian lives were considered morerisky for coverage. The Bombay Mutual Life Insurance Society started its business in1870. It was the first company to charge same premium for both Indian and non-Indianlives. The Oriental Assurance Company was established in 1880. The General insurancebusiness in India, on the other hand, can trace its roots to the Triton (Tital) InsuranceCompany Limited, the first general insurance company established in the year 1850 inCalcutta by the British. Till the end of nineteenth century insurance business was almostentirely in the hands of overseas companies. Insurance regulation formally began in Indiawith the passing of the Life Insurance Companies Act of 1912 and the provident fund Actof 1912. Several frauds during 20s and 30s sullied insurance business in India. By 1938there were 176 insurance companies. The first comprehensive legislation was introducedwith the In