amsure ulip pan
DESCRIPTION
The following is the presentation of Unit linked insurance plan of Amsure.TRANSCRIPT
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AGENDA
1. WHY UNIT LINK INSURANCE PLAN IN OUR PORTFOLIO
2. WHAT WILL BE THE SALES PITCH FOR AMSURE UNIT LINK PRODUCT
3. PV
4. BUSINESS SUPPORT MATERIAL
5. LAUNCH SCHEDULE
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WHY UNIT LINK INSURANCE PLAN IN OUR PORTFOLIO
• Buoyant equity market have made unit link plan attractive to customers.
• In 2005-2006, unit link plan was 42% of LIC’s new business premium.
• More and more companies are unitizing their offerings.
• Leads to higher premiums.
• Popular with affluent segment which may not have bought pure insurance but want tax efficient investment insurance tools.
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Sales Pitch
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• To protect against :– risk of dying too early.– risk of living too long.
• Forced yet an effective savings & protection tool.
• Tax savings.
WHY DO WE BUY INSURANCE?
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WHAT DO WE SEEK IN A GOOD UNIT LINK INSURANCE PLAN !
1.RETURNS
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The key to great returns lies in successful investing in different asset classes i.e “Asset Allocation”
Three major types of financial assets are:
• Equity shares
• Bonds
• Cash
A unit linked fund allocates your monies between these three asset classes in a scientifically determined ratio : and thereby
offers you the chance to get higher returns
HOW?
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WHAT DO WE SEEK IN A GOOD UNIT LINK INSURANCE PLAN !
2. CHOICE OF FUNDS WITH DIFFERENT RISK-REWARD RATIOS.
and
3. SWITCHING : ABILITY TO TAKE ADVANTAGE OF MARKET MOVEMENTS BY MOVING MONIES BETWEEN DIFFERENT
FUNDS BASED ON CHANGING MARKET DYNAMICS
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WHAT DO WE SEEK IN A GOOD UNIT LINK INSURANCE PLAN !
4. Maturity Guarantee
To ensure that while you enjoy the benefits of the upside in the market, you also get the safety net of your Maturity being guaranteed .
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Can you guess how much your child’s education will cost you?
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MBA
MEDICINE
ENGINEERING
MBA
MEDICINE
ENGINEERING
MBA
MEDICINE
ENGINEERING
YEAR2000
YEAR2010
YEAR2020
3.2 lacs5.0 lacs2.4 lacs
8.50 lacs
13.26 lacs
6.37 lacs
5.21 lacs
8.14 lacs
3.91 lacs
* At an average annual inflation of 5% p.a.
Escalating costs of Higher Education*(in Rs.)
And this is without considering the additional increases which will happen due to colleges arbitrarily increasing fee every 2 - 3 years
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WHAT DO WE SEEK IN A GOOD UNIT LINK INSURANCE PLAN !
5. Protection from Inflation : TO ENSURE OUR SAVINGS HAVE THE SAME PURCHASING POWER AS TODAY
.
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1. RETURNS
2. CHOICE OF FUNDS WITH DIFFERENT RISK-REWARD RATIOS.
3. SWITCHING
4. Maturity Guarantee
5. INFLATION PROTECTION
Five must have features in an Ideal ULIP
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INTRODUCING MAX AMSURE SECURE RETURNS BUILDER
1. RETURNS
2. CHOICE OF FUNDS
3. SWITCHES
4. GUARANTEE
5. INFLATION PROTECTION
AN IDEAL ULIP
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CHOICE OF 4 FUNDS WITH DIFFERENT RISK - REWARD RATIOS.
Choice of 4 funds– GROWTH FUND : Non Guaranteed
fund with maximum 70% equity investment
- BALANCED FUND : Non Guaranteed fund with maximum 40% equity investment
– GUARANTEED FUND (DYNAMIC) : Guaranteed fund with maximum 30% equity investment
– GUARANTEED FUND (INCOME) : Guaranteed fund with maximum 15% equity investment
Potential Risk Return profile of the fund
High risk high returns
Medium risk medium returns
Moderate risk, with guarantee
Low risk, with guarantee
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Many Investment Choices….As per your appetite
FUNDS ALLOCATION
OF ASSETS Growth Fund
Balanced Fund
Guaranteed Fund
(Dynamic)
Guaranteed Fund (Income)
Equities 20% – 70% 10% - 40% 0% - 30% 0% - 15%
Corporate Bonds
0% - 30% 20% - 40% 0% - 50% 0% - 50%
Government Securities
0% - 30% 20% - 50% 50% - 80% 50% - 80%
Money Market instruments
0% - 20% 0% - 20% 0% - 20% 0% - 20%
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Good Fund Performance p.a.) over last 22 Months
31.34%
10.56%
4.56%
18.58%
0%
5%
10%
15%
20%
25%
30%
35%
Growth Balanced Conservative Secure
CAGR over past 22 months
The non guaranteed funds in the product
Structure close to the structure of the two guaranteed funds
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UP TO ENTRY AGE 50 = 100% of Allocated PremiumsAllocated Premium in 15 Year Term = 95.87% of total PremiumAllocated Premium in 20 Year Term = 96.15% of total Premium
ENTRY AGE 50 OR MORE = 85% of Allocated PremiumsAllocated Premium in 15 Year Term = 81.49% of total PremiumAllocated Premium in 20 Year Term = 81.73% of total Premium
Allocated Premiums = Premiums minus Allocation Charge
GUARANTEE IS APPLICABLEIF INVESTED IN THE GUARANTEED FUNDS
Maturity GuaranteeGuarantee is on the premiums allocated in the GUARANTEED FUNDs
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Flexibility to Maximize Returns Through SWITCHINGAbility to move monies between different funds offering different risk return profiles
• Helps you take advantage of changing market dynamics
• Helps you change the risk – return profile of your existing investments
• Normally done when there are perceptible changes in the market viz.– when equity market ends recession and starts
booming (or vice versa)– when interest rates reverse a rising trend and start
decreasing (or vice versa)
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• Allowed between the two guaranteed funds
• Allowed between the two non guaranteed funds
• NOT allowed between non-guaranteed funds on one hand and guaranteed funds on the other
• Two switches are free every policy year
Flexibility to Maximize Returns Through SWITCHING
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INFLATION PROTECTION
• Two options available to us: – With Inflation Protection (Increasing Sum Assured)– With out Inflation Protection (Level Sum Assured)
• In increasing (i.e. inflation protection) option: the Sum Assured and Premiums increase @ 5% every year - COMPOUNDED.
– Your have an option to move from Increasing option to Level option once during the term of policy subject to two policy years having been completed (if he decides to do so, his sum insured and the premium will get frozen at values on the date of the move)
This product protects your client if he lives to maturity (i.e. on premiums) as well as if he dies before maturity (i.e. on Sum
Assured) : hence truly protects against inflation !!!
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Illustrated Maturity Values
Age TERM Premium Sum Assured 6% earnings 10% earnings
level Increasing Level Increasing
25
20 50,000
500,000
1,386,263 2,209,278 2,054,498 3,117,374
35 1,381,534 2,201,863 2,047,329 3,107,237
45 1,359,168 2,169,133 2,011,968 3,060,313
55 1,295,270 2,072,539 1,912,104 2,925,376
25
15
905,137 1,288,101 1,201,963 1,664,888
35 901,301 1,282,098 1,197,058 1,657,952
45 883,205 1,255,603 1,172,861 1,625,844
55 831,481 1,177,412 1,104,529 1,533,512
INCREASING OPTION GIVES HIGHER RETURNS TOO!!
But then on maturity, for a 15 year term for age 35 ,the maturity amount will be 31 Lacs instead of 20 Lacs
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OTHER ADVANTAGEOUS FEATURES WHICH WE OFFER
• Partial Withdrawal– Allowed from Non-Guaranteed funds only: Liquidity in times of
needs.– Can with draw up to 20% of non-guaranteed fund value in any
year.– Not allowed from Guaranteed funds.
• Option to buy Personal Accident Benefit Rider- Till age of 60- No rider premiums : rider charges recovered by canceling units- Provides additional sum assured on accidental death or
accidental disability
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CHARGESAllocation Charges (recovered by deducting before allocating premiums to funds)
First Year Allocation Charge - 20% of premiumSecond Year Onwards - 3% of premium(In increasing SA option, 1st year charge is recovered on increased portion of premium)
Administration Charges (recovered by canceling units)FIXED : Rs. 50 per month. Inflating at 5% per annum.VARIABLE : 0.42% per month of sum assured in years 1 and 2. : A very small % per month for duration of life of policy.
Fund Management Charges (recovered by adjusting in NAV)Growth Fund @ 1.25% p.a.Balanced Fund @ 1.10% p.a.Guaranteed Fund (Dynamic) @ 1.70% p.a.Guaranteed Fund (Income) @ 1.50% p.a.
Surrender Charges (Surrenders allowed after 3rd policy year)10% of Fund Value in 4th policy year, 5% in 5th policy year, NIL thereafter.
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VITAL STATISTICS (1):Issue / Maturity Ages, Policy Tenure, Premium Payment period
Entry age: Minimum 91 daysMaximum 60 years (calculated as at last birthday)
Policy (Benefit) term: 15 years or 20 years
Age at maturity : Minimum 18 yearsMaximum 75 years
Premium Payment Term For full Benefit Tenure i.e. either 15 or 20 years
NB:The 15-year term will only be offered from issue ages 3 and above (keeping in mind the minimum maturity age of 18).
The 20-year term will only be offered up to issue age 55 (keeping in mind the maximum maturity age of 75).
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Premium : Minimum Rs 10,000Maximum Rs 100,000 (if entry age is between 91 days – 40 years)Maximum Rs 50,000 (if entry age is 41 years or above)
Sum Assured Always 10 times the PremiumMinimum SA = 10,000 * 10 = Rs 1,00,000Maximum SA = 100,000 * 10 = Rs 10,00,000
Sum Assured types LEVEL or INCREASINGLEVEL Sum Assured : in this option, your sum assured remains 10 times your original premium as chosen by you
INCREASING Sum Assured : in this option, your sum assured and your premiums increase by 5% p.a., compounded (but your sum assured always remains 10 times your premium)
Death Benefit Higher of Sum Assured or Policy Fund Value from age 11 onwards(Till age 11, Death Benefit = Policy Fund Value)
VITAL STATISTICS (2):Premiums, Sum Assured, Death Benefit
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Since premiums are always less than 20% of Sum Insured, your client will get the following tax benefits:
- U/s 80C : on premiums paid. This benefit is allowed up to Rs 100,000 every year
- U/s 10(10D) : on maturity benefits, partial withdrawals and death benefit
VITAL STATISTICS (3):TAX BENEFITS
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COMPETITIVE SCAN
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Companies offering unit link products with no Maturity Guarantee and no inflation indexing
1. LIC of India
2. HDFC Standard Life Insurance
3. Bajaj Allianz Life Insurance Company Ltd
4. Tata AIG
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LIC OF INDIA
• Only one Unit Link Plan available – Market Plus
– No Maturity Guarantee
– A deferred Pension Plan
– Pension i.e. annuity is taxable under current income tax rules.
– No Inflation Protection
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AVIVA
• SAVE GUARD– Offers 1 Maturity Guarantee fund & 2 Non Guaranteed Fund
– Guarantee reduced if any amount switched from the guaranteed fund at any time during the policy term
– Initial Management Charge of 7% per annum of initial units during the policy term, subject to maximum of 20 years (since the minimum tenure is 10 years, at least 70% of first year premium will be taken as charges; the maximum could go up to 140% of first year premium).
– No Inflation Protection.
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Flexi Save Plus Plan
• Guarantee of Return @ 3% on premiums net of policy charges
• Multiple funds. Switching Allowed.
• High Allocation charges (as per adjacent table)
• High annual charges : @ Rs 2.88/000 SA
• No Inflation Protection
BIRLA SUN LIFE INSURANCE
Policy Year Allocation Charges1 65.0%2 7.5%3 7.5%4 5.0%5 5.0%
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ICICI PRUDENTIAL
• Invest Shield Life (New)
– ONLY Maturity Guarantee Product in ICICI Prudential portfolio
– Only one fund, no switching
– No Inflation Protection
Fund Means
No Switching
Only One
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PV
SAME AS CURRENT
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BUSINESS SUPPORT MATERIALS1.Flip chart detailing the sales pitch you just saw.
2.A 15 minute video in Hindi & English on ‘Why Insurance’
3.A 15 minute video in Hindi & English on ‘Max Amsure Secure Return Builder’.
4.Brochure.
The same will be given to platinum and above leaders at launch events & are being mailed to all Founder Club Members.
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Launch Program
1. 23rd October Delhi
1. 24th October Kolkatta
1. 25th October Mumbai
1. 26th October Chennai
1. 28th October Hyderabad
Other Cities for local launches:
Jaipur, Chandigarh, Lucknow, Bhopal, Surat, Ahmedabad, Guwahati, Bhubneshwar, Cochin, Bangalore
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