ULIP V/s MF FOR ADVISORS

ight dvise
ariable
&
aluable
nnovative
Grow beyond your limits
R RAVINDRA KUMAR

R Ravindra Kumar
Passionate Trainer and Spiritual Life Coach
R Ravindra Kumar has 30 years of experience working at middle and
Higher Management in world's largest Life Insurance Corporations’ in India
and at Fiji Islands. He Headed the 7 Branches In India and Was Sr.DM of
Bhavnagar Division in Gujarat. Presently working as Regional Manager in LIC
OF INDIA
Sri Ravindra Kumar is a proven marketer with a most scintillating range of skills
of marketing, presentation and interaction. A very gifted speaker he has been
rravindrakumar@yahoo.com
of marketing, presentation and interaction. A very gifted speaker he has been
directly involved in a pro-active manner in taking each of the units under his
charge to new heights of New Business performance. Agents training and
agency management, strategic planning, sales operations and financial
consulting have been special thrust areas adopted by him. With broad
experience in all the aspect of life insurance underwriting and selling and
with ability to efficiently assess client and corporate needs, deliver solutions.,
manage internal and external relationships while exceeding client and
corporate expectations and fully maintaining profitability goals have
given him a proven track record of remarkable success.

As a Coach, Facilitator, Manager and Trainer, He has been Helping Professionals Achieve
their Career Goals since the 1999.. He is having much passion and interest coaching to
Sales Executive, and Management professionals from corporations, as he is working
with employees from all levels of organizations and Internationally Educated
Professionals, as well as students and graduates from colleges and universities.
Throughout his career, he worked with clients of outplacement and career transition
firms, colleges, and community employment centres. In his work, has provided Coaching
and consulting to clients of all levels of organizations - Vice President to employees
beginning their careers.
Widely travelled Sri Ravindra Kumar is a multilingual leader and Business Mentor with a
Widely travelled Sri Ravindra Kumar is a multilingual leader and Business Mentor with a
wide experience in multi-cultural and global environment. Reading, music,creative
presentations and development of human resources are his areas of special interest.
“How would your life change if you could tap into your full potential? What one thing
do want most for your life but feel unable to reach it? How would you like to set goals
and create a blueprint or roadmap to not only reach your goal, but sustain it?
Come and Discuss with R Ravindra Kumar He will Show you You Can do in life.”

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"If You
Graduated
Yesterday,
Stop learning
ULIP vs. MF
Stop learning
Today, You
will be
Illiterate
Tomorrow."

••••••••••••••••••••••••••••••••••
••••••••••••••••••••••••••••••••••

•IRDA Report about ULIP
•IRDA Report about ULIP
1
•Myth vs. Reality about ULIP
•Myth vs. Reality about ULIP
2
•Today’s NAV of All ULIPs of LIC
•Today’s NAV of All ULIPs of LIC
3
•ULIP vs. MF
•ULIP vs. MF
4 •ULIP vs. MF
•ULIP vs. MF
4
•Examples
•Examples
5
•Whom and How to sell ULIPs ?
•Whom and How to sell ULIPs ?
6
•Free ULIP Policy for all LIC agents attending today’s
seminar!
•Free ULIP Policy for all LIC agents attending today’s
seminar!
7

People will certainly
move to MF
LIC < 10%
LIC < 10%
> 15

Shri Ram is willing
to save Rs. 10-
12,000/pm and
12,000/pm and
wants 20-22 after
8-10 years. Which
LIC plan can you
suggest him?

• People are ready to take
• What is Little/More risk?
Little Risk
• Guaranteed Product = 0 Risk
ROI < 6-7% - LIC/PO/Bank FD
Financial
Pyramid
ROI < 6-7% - LIC/PO/Bank FD
Pyramid
• Can reduce 70-80% burden
Calculated
Risk

Which plan would you
suggest to Shri Ram?
Growth 10%
Does MF
Give
Growth 10%
10%=
20L
9%=18L
Calculated Risk
Give
Guarantee?

NEON TUBES
17

99.65%
27,187.50 Cr
0.35%
93.26 Cr

Belief # 1
ULIP is a high risk
plan. If client does
not get fair value,
relationship spoils
and sometimes
and sometimes
they stop paying
for traditional
plan also!

FACT
o Can mitigate risk with bond
fund – 60% G Sec & 40% Money
fund – 60% G Sec & 40% Money
Mkt
o 0% Equity Risk
o Chances of better maturity than
traditional

Sale is more; not ROI
PVT vs LIC in
Traditional Plans
PVT vs LIC in ULIP
99.65% vs. 0.35!

ULIP FUND Today DOC Days NAV NAV IRR

Not a single fund is in ( - )
Not a single fund is in ( - ) Minimum IRR is 3.84%
Minimum IRR is 3.84%
OBSERVATIONS
OBSERVATIONS
Better Than Traditional
Plan’s IRR!!!
Better Than Traditional
Plan’s IRR!!!
Maximum IRR is 42.47%
Maximum IRR is 42.47%
OBSERVATIONS
OBSERVATIONS

ULIP/MF
Right-Time Entry – Right-Time Exit
Right-Time Entry – Wrong-Time Exit
ULIP/MF
Wrong-Time Entry – Right-Time Exit Wrong-Time Entry – Wrong-Time Exit
33

What is today’s NAV for Market Plus and
Money plus?
Market Plus – Balance Fund – 39.5350(9.10%)
Bond Fund – 32.3699(7.77%); Growth Fund –
24.1327(5.83%); Secure Fund – 33.4612 (7.99%)
Money Plus – Balance Fund – 36.7581(8.89%);
Money Plus – Balance Fund – 36.7581(8.89%);
Bond Fund – 32.3699(8.02%); Growth Fund –
24.1327(6.01%); Secure Fund – 33.4612(8.25%)
Ignorance of law is not defence
Who is responsible for not switching Over?
34

1. Tax Benefits
80 (C) and (10)(10)(D)
MF – No 80 (C) and (10)(10)(D) except – ELSS
Equity Linked Savings Scheme – STCG / LTCG
WEF 1/2/2021, ULIP – 10% LTCG*

2. Triple Benefit Product
(1) 80C up to 1.50 Lakhs
(2) Built in insurance
(3) Maturity is Tax Free is if the annual
premium is less than Rs. 2.50 lakhs
38
MF does not have any of these
Dr. Manoj Shukla [MBA; Ph.D.]

A few MF cover risk with
****
Must stay connected with
MF for at least some years
Cannot get more than ****
Cannot get more than ****
amount of insurance
If redempted at early stage
and rejoin, then the benefit of
insurance is not applicable

3. Lock-in Period
Best option against NSC and tax saving FD
Most of the MF schemes are w/o lock-in period
ELSS – 3 years
Theme oriented MFs like Children's Fund/
Retirement Fund – 5 years just like ULIP only!
Retirement Fund – 5 years just like ULIP only!
MF – after 6 months also!
+ / - ???
53% quit MF within 2 years only!
76% quit after 5 years!

4. Charges

The reason
for refrain
from ULIP
• 2004-2010,
HIGHEST
CHARGES
• IRDA
amended the
rules
• Allocation
Charges
drastically
reduced
• 0 admin
charges for
more Units
• GA
• Mortality
charges to be
refunded at
maturity
• = Free
Insurance
• Partial
Withdrawal
• Assignment
• ULIP – Fund
Management
Charges-1.35%
•MF – Expense
Ratio Charges
2.50% + Exit
load
•Max. Equity
exposure
80% in
Growth Fund
• = Stability
in Bullish or
Bearish Mkt
• DAB @
40p/1000 Only
• Better than
Term Insurance

Plan – 852
Prem – 1,00,000/p.a.
852
Prem – 1,00,000/p.a.
S.A. – 10.00 Lakhs

5. Fund Option &
5. Fund Option &
Asset Classes

MF – Large Cap, Mid Cap, Flexi,
Short Term Debt, Long Term
Debt, Multiple Asset Classes,
Dynamic Asset Allocator, Fund
Dynamic Asset Allocator, Fund
Only Invest in Banks, Only in
Pharma Companies ...

ULIP
Bond Fund
Balanced Fund
Growth Fund
Secured Fund
ILIP – Index Linked
Insurance Product
ULIP

6.

7. Loyalty Benefits
New feature only ULIP has
GA @ 5% in 5 years
@ 10% in 10 years
@ 15% in 15 years
@ 15% in 15 years
@ 20% in 20 years
@ 25% in 25 years.
Bullish Market – Book Profit
Bearish Market – Stop-loss

One
• GA in ULIP !
• 5%-10%-15%-20%-25% - Every 5 year
Two
• SIP – 8,333/- = 1,00,000/p.a
• After 5 yrs – 5% 0f 1,00,000 = 5,000/NAV (16) = 312.50
Units
Three
• 10 (26) – 384.61 15 (41) – 365.85
• 20 (67) – 298.50 25 (108) – 231.48 = Total – 1,592.94
Four
• Total Unit – 1,592.94 @ 108 = 1,72,037.52
• More NAV, More ROI; Less NAV, Stop Loss

Only ULIP has free switching facility
Can move from one fund to another w/o Charge
MF – Exit load and STCG/LTCG
Risk in ULIP can be mitigated

9. Transparency
MF and ULIP have increased transparency level
DailyNAV–InformationonchargesinULIPthroughBI
Agent’s responsibility to select/change the fund
New business through switching option

Ask...Ask...Ask...Ask...
1. How much return are you willing to receive in
the next 5-10-15-20 years?
2. When do you need liquidity?
3. How often do you re-balance your portfolio?
2. When do you need liquidity?
4. Do you want tax benefits or not?

Whom &
How to
Sell ULIP?
Sell ULIP?

C
A
P
A
C
I
H
I
G
H
L
I
T
Y
WILLINGNESS
L
O
W
UNWILLING WILLING
56

Millennial
Choice
The market is
changed a lot
Highest
Minimum
Expands
Segments
by 50%
Can beThe
Best Mix
Product
Ideal for
short term
changed a lot
due to MF
For People
who are ready
to take risk of
stock Mkt
Far Better
ROI than
Traditional
Minimum
Comm.
short term
returns
Easy
MDRT

Practical Example
How ULIP is Better than
Traditional Product?

Assumptions
Age: 18 years SIP/ECS – 5,000
Assumptions
Surrender After: 15 Yrs Expected Growth of NAV:
10%

10% NAV
Growth
10% IRR
After 15 yrs.
NAV – 44.81
@ 10%
Growth
Assumption
10% IRR

NAV –
NAV – NAV –
NAV – NAV –
NAV – NAV –
NAV –
NAV –
36.7581
Under
Balance
Fund –
IRR –
8.89%
NAV –
36.7581
Under
Balance
Fund –
IRR –
8.89%
NAV –
39.5350
Under
Balance
Fund –
IRR –
9.10%
NAV –
39.5350
Under
Balance
Fund –
IRR –
9.10%
NAV –
52.6785
Under
Growth
Fund –
IRR –
10.50%
NAV –
52.6785
Under
Growth
Fund –
IRR –
10.50%
NAV –
58.0973
Under
Growth
Fund –
IRR –
10.70%
NAV –
58.0973
Under
Growth
Fund –
IRR –
10.70%

All 4 plans > 15 yrs or older
With very high charges
Now reduced by 1.35%
+ Due to Less Charge + GA after every
+ Due to Less Charge + GA after every
5 yrs NAV certainly will increase
67

Assumptions
Age: 18 years SIP/ECS – 5,000
Assumptions
Surrender After: 15 Yrs Expected Growth of NAV:
10%

Plan – 914-15 – New Endowment Plan – 5,000/pm

Plan – 852-15 – SIIP – 5,000/pm

914 vs. 852
What is the
Can you
guarantee
the same
What is the
Bonus for
914/936
Today?
the same
bonus after
15 years or
will not
reduce?
38 vs. 35???

•41.77 ≠ 41.77% IRR
NAV
•NAV 41.77 = 9.53%
IRR

What is the best investment?
Nothing! It is in the Mix!
What is the best mix?
Nothing! It is as per the needs!

914-20 – 10,000/MLY

852-10,000/MLY
852-20- 10,000/MLY

914-20- ECS-5,000 + 852-20- ECS-5,000

PMI of ULIP
1.Market
Based
2.Bad history
1. Many people
are ready
2. If we don’t,
others will
P M I
1.Better IRR
2.Short Term
3.Partial
Withdrawal
4. Best Mix
2.Bad history
3.No Trust
4.Not for
Lower
Income
Class
others will
3. P/W can be
reinvested in
traditional
plan
4. Cross Selling

Free
ULIP for
Today’s
Agents
Agents

SIP of 4000 @ 3.5% 13.72 Prem. 13.72/48000 =28/p.a=2-3/pm
83

Manage 28
Excel Record
DOC to Qly
DOC to Qly
NAV
Re-Balance

Doctors can’t make you healthy
Doctors can’t make you healthy
85

Teachers can’t make you IAS
Teachers can’t make you IAS
86

No any Trainer can’t make you MDRT
No any Trainer can’t make you MDRT
87

Your growth is only your responsibility
Your growth is only your responsibility
88

1. Know more than others
2. Do more than others
William Shakespeare
89
26 April 1564 – 23 April 1616
2. Do more than others
3. Expect less than others!

Thank You
Presented BY R Ravindra Kumar RM (Inspection) WZ

R.
R. Ravindra
Ravindra Kumar
Kumar
Regional Manager
LIC OF INDIA
Ahmedabad
rravindrakumar
rravindrakumar
92
rravindrakumar
rravindrakumar.mop
+91 9726351246 Only Or
send TEXT ON +919427960310
Email ME@ rravindrakumar@hotmail.com
rravindrakumar@gmail.com
rravindrakumar@rediffmail.com
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ULIP V/s MF FOR ADVISORS

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