Want guaranteed returns? Some insurance plans for you

At a time when investors are looking to park their earnings in safe havens such as fixed deposits, life insurance companies are offering guaranteed-return products to lure risk-averse investors.

LIC’s Jeevan Aastha

Jeevan Aastha is a single premium assurance plan offering guaranteed returns of 9-10 per cent depending on the tenure of investment. The plan offers a guaranteed return of 10 per cent of the maturity sum assured for a 10-year term and a 9 per cent return for a five-year period. It offers a basic sum assured of Rs 1.5 lakh, which could increase in multiples of Rs 30,000 with no upper limit.

On maturity, the sum assured along with the guaranteed return would be paid to the customer. According to the company, while 50 per cent of the amount collected through this policy would be invested in government securities, the remaining would be invested in debt instruments.

The policy can be surrendered for cash after the policy has run for at least one year. Beginning December 8, 2008, the close-ended plan is open for subscription for 45 days.

IDBI Fortis Bondsurance

Aiming to tap customers looking for guaranteed returns, IDBI Fortis Life Insurance has recently launched a guaranteed-return plan named Bondsurance. Bondsurance offers guaranteed return on investment along with life insurance cover. With a one-time minimum investment of just Rs 20,000, Bondsurance is specially crafted for those looking for attractive guaranteed returns with the promise of insurance protection.

The plan, in fact, addresses the needs of those willing to put away money for either 5 years or 10 years, earning a guaranteed return on the premium paid. At the same time, in the short term, Bondsurance offers liquidity after the first year with a special surrender value in case one needs the funds in a hurry. The plan also comes with two attractive tax benefits under Sec 80C and 10(10D) of the I-T Act.

According to the company, an investment of Rs 100,000 in Bondsurance would fetch Rs 2.03 lakh for customers in the age bracket of 8 years to 32 years on maturity, at the end of ten years. The maturity amount, however, varies with age and term of the plan.

Aegon Religare Guaranteed Return Plan

This is a single-premium plan that guarantees tax-free returns along with life cover. It is a close-ended scheme that offers guaranteed returns at a compounded annual rate 7.2 per cent for two tenures: 7 and 10 years. In the highest tax bracket the guaranteed returns are equivalent to a pre-tax return of 10.90 per cent.

Anybody in the age group of 90 days to 45 years can buy this policy by paying single premium in the range of Rs 50,000 to Rs 4 lakh. The returns on maturity are tax-free and the plan comes with an added benefit of life cover -- five times of the single premium paid. The policy, which requires no medical test, is open for subscription for a limited period only.

Reliance Life ULIPs with guaranteed return

Reliance Life Insurance has launched two unique unit-linked plans under Reliance Guaranteed Return Plan Series I with insurance and pension options, assuring financial security with guaranteed maturity benefit at 6.85 per cent compounded annually plus upside, if any.

The single unit linked insurance plan is available for limited period in two options – Reliance Guaranteed Return Plan Series I – Insurance and Reliance Guaranteed Return Plan Series I – Pension – with fixed term of five years. Under Reliance Guaranteed Return Plan Series I, investment rate of return would amount to 10.4 per cent presuming tax benefits at 10 per cent rate of return and tax rate of 33.99 per cent.

Besides maturity additions in insurance option, death benefit comes with sum assured plus fund value. The insured can choose any life cover between 1.25 to 5 times of single premium. In pension variant, in addition to maturity benefits, the guaranteed return on death is available during the fifth year.

The new plan also provides partial withdrawal benefits in insurance option after three years. Minimum withdrawal amount would be Rs 5,000, whereas maximum withdrawal amount should be 20 per cent of the fund value at the time of withdrawal.

Birla Sun Life’s Dream Plan

Birla Sun Life Insurance Dream Plan is a long-term unit linked insurance plan which offers guaranteed maturity benefits with options to double or triple the guaranteed maturity benefit by choosing 200 per cent or 300 per cent options.

It also gives choice to enhance life cover anytime during the policy term at minimal additional cost. However, the enhanced sum assured chosen must be at least Rs 50,000.

This is not a limited period plan and you can pay the policy premium monthly, quarterly, half-yearly or annually

Fuel price cut in Jan

Guruvayur (Kerala) : The Centre would effect a further reduction in petroleum prices next month, Union Minister for Petroleum and Natural Gas Murali Deora said in Guruvayur on Tuesday.

A decision on reduction of prices of petroleum products would be taken before February next, Deora, who visited the famous Sree Krishna temple, said.

Proposal on supply of cooking gas through pipelines was also under consideration in view of the shortage of LPG cylinders

Air India cuts basic fares upto 82 pct

Mumbai : National air-carrier, Air India on Tuesday slashed its basic air fares in the domestic sectors ranging 35-82 per cent.
The fare cut was effective from 1500 hours on Tuesday, an Air India spokesperson said.
The maximum reduction in fares was 82 per cent on the Chennai-Bangalore route, while on Mumbai-Kolkata route, the reduction would be 35 per cent, Air India said.
The basic fare for travel between Mumbai and Delhi now stands reduced by 49 per cent, the company said.
The fare cut has come a day after Air India's competitor and private air carrier, Jet Airways reduced its basic fares upto 40 per cent.
Another leading private air carrier, Kingfisher Airlines, had also announced reduction in its fares from January 1.
However, Kingfisher is yet to take a decision on the quantum of the cut.

Jet Airways cuts basic fare by up to 40%

New Delhi : Country's largest private airline Jet Airways has announced up to 40 per cent reduction basic fares on economy class on all its domestic flights from.
A Mumbai-Delhi economy class basic fare will now be Rs 2,000, for Mumbai-Kolkata it will be Rs 4,065 and for Bengaluru-Mumbai it will come around Rs 1,220, a company statement said.
The fares would be applicable on the airline's domestic network of 45 destination. The usual taxes and surcharge would be applicable.

Rupee depreciates to 48.20 against dollar

MumbaiThe Indian rupee after appreciating by 26 paise in the opening trade, turned weak to trade 32 paise down against the US currency at 1100 hrs on capital outflow concerns in line with weak trend on the domestic bourses.
In quiet trade at the Interbank Foreign Exchange (forex) market, the domestic currency strengthened to Rs 48.20 after steady opening at 48.45/47 a dollar from its last close of 48.45/46 against the greenback and later fell by 32 paise to 48.78 at 1100 hrs.
Forex dealers said the rupee failed to get any support from lower crude oil prices in view of increased possibility of a rate cut in the near future.
Global crude oil prices traded below USD 40 a barrel level at around USD 39 in Asian trade on Monday.
Weakness in local stocks amid capital outflows also weighed on the rupee sentiment, they added.
Indian benchmark Sensex was down 139 points or 1.49 per cent at 1015 hrs while Asian markets witnessed mixed trend in early trade: Source: Financial Express

Microsoft asked to lay off over 9,000 employees

New YorkThe world’s top software firm Microsoft has been asked to cut its workforce by 10%, or about 9,100 employees, to tell the market that profits are more important than revenue growth in difficult times.
Brokerage firm Oppenheimer & Co’s analyst Brad Reback has said in a report on Microsoft that such layoff exercise “would be a healthy move for the company.”
The move would be well received by the market and would “signal that profitability is more important than revenue growth during this very difficult time,” Reback added.
Calling for a 10% reduction on the company’s payrolls, Reback said in his report for the institutional investors of Microsoft, this would result in an approximately 10% gain in its earnings per share.
The software giant had close to 91,000 employees on its payrolls at the end of July-September quarter.
Earlier in October, Microsoft had put in place a hiring freeze on some of its divisions, such as entertainment and devices businesses that make products like X-Box and Zune.
There have been some unconfirmed reports on blogs that the company would announce some major layoffs in the first month of 2009.
Microsoft is scheduled to release its second-quarter results for the fiscal year 2008-09 on January 22.
Battling the economic crisis, companies in their bid to save costs, have announced more than one lakh job cuts in December alone in the US, while so far in 2008 there have been close to 20 lakh layoffs.

India may see deflation in '09-10: Bankers

MumbaiIndian economy may go into deflation by the second quarter of financial year 2009-10 as there are fears of inflation going below zero per cent in the face of unprecedented fall in crude and commodity prices.
"If the current pace in inflation-decline continues, the figure (in WPI-based inflation) may slide below two per cent by end-fiscal," HDFC Bank's Deputy Head of Treasury, Ashish Parthasarathy, said, adding "it may fall further to below zero per cent by Q2 FY10."
Inflation almost halved to a nine-month low of 6.61 per cent from this year's peak of 12.91 per cent, giving more space to the RBI to signal further cuts in interest rates.
Deflation occurs in an economy when the negative inflation prevails for a long period. In the event of deflation, the Reserve Bank will have to enhance money supply and lower rates further "to support inflation", IDBI Gilts' Economist, Amol Agarwal said.
Citibank India's Chief Financial Officer, Abhijit Sen, echoed this view saying that the rapid decline in the headline inflation is likely to continue in the coming months.
"In my view, deflation is a remote possibility in this economy. However, if the inflation continue to fall to much lower levels, this would have an impact on the profitability of banks, as it would affect the credit demand," Sen said.
The sharp decline in inflation has given a headroom for the Reserve Bank to slash its reverse repo rate by 0.5-1 per cent, he said.Source: Indian Express

Top 10 firms lose Rs 61,000 cr

MumbaiThe country's top 10 firms saw an erosion of nearly Rs 61,000 crore in their market cap last week, with the Reliance Industries's market cap slipping below Rs 2,00,000 crore.
The PSU mining giant MMTC was the only one in the elite club to defy the trend and gain Rs 8,278 crore in market valuation.
The total market capitalisation of the elite club comprising six public sector and four private sector entities dropped by Rs 60,872 crore in a week.
At the end of Friday's trade last week, the combined valuation of the premium club stood at Rs 10,41,283 crore, against Rs 11,02,154 crore a week ago.
The country's most valued firm Reliance Industries suffered the worst blow losing Rs 21,600 crore in a week and dipped below the Rs 2,00,000-crore mark.
The Mukesh Ambani-led firm saw its valuation drop to Rs 1,90,745 crore at the end of Friday's trade from Rs 2,12,345 crore a week earlier.
RIL, which was trading at Rs 1,349.25 a share on December 19, skid over 10 per cent during the week to settle at Rs 1,212 per share at the end of Friday's trade.
Also, the state-run NTPC replaced ONGC at the second spot of the coveted club. While oil behemoth lost a huge Rs 14,000 crore, the power utility merely lost Rs 3,958 crore in a week.
The PSU mining giant MMTC added Rs 8,278 crore and increased its valuation to Rs 1,04,115 crore by Friday last.
Sunil Mittal-led company Bharti Airtel lost Rs 6,614 crore. Also, country's biggest lender the State Bank of India saw its valuation go down by Rs 2,755 crore to Rs 78,995 at the end of Friday's trade-Source:Indian Express

Top 21 Ulips

Fund Category        :    Debt Oriented

Type of Return        :    Absolute

Ranking Period        :    One Week

 

 

Insurer	Fund Name	NAV	NAV Date	1 Week	1 Mth	3 Mth	6 Mth	1 Year	3 Yrs	5 Yrs	Ince.
Tata AIG	Short Term Fixed Income Fund	11.6230	24/12/2008	5.5	3.51	4.96	6.13	8.96			16.23
LIC	Money Plus Bond	12.3342	23/12/2008	1.79	6.97	13.82	16.26	16.02			23.34
LIC	Jeevan Plus Secured	12.9040	23/12/2008	1.73	7.11	9.38	11.61	5.65	27.62		29.04
LIC	Market Plus Bond	13.5442	23/12/2008	1.59	6.02	11.99	15.42	17.71			35.44
LIC	Future Plus Income	14.4486	23/12/2008	1.55	6.39	7.93	8.03	4.46	32.91		44.49
LIC	Market Plus - I Bond	10.7886	23/12/2008	1.45	4.01	4.71	7.89				7.89
LIC	Future Plus Bond	13.0679	23/12/2008	1.42	5.2	11.41	12.7	13.51	24.52		30.68
MetLife	Preserver Fund	13.5094	24/12/2008	1.4	11.99	19.3	20.81	16.04	28.41		35.09
MetLife	Pension Preserver	13.5094	24/12/2008	1.4	11.99	19.3	20.81	16.04	28.41		35.09
LIC	Market Plus Secured	11.6337	23/12/2008	1.15	6.48	3.83	4.14	-4.21			16.34
Aviva	Bond Fund	11.7530	23/12/2008	1.11	8.23	14.87	17.18				17.53
MetLife	Protector Fund	13.0134	24/12/2008	1.1	11.32	13.5	13.66	13.22	24.91		30.13
MetLife	Pension Protector	13.0134	24/12/2008	1.1	11.32	13.5	13.66	13.22	24.91		30.13
Birla	Individual Life - Income Advantage	11.4987	25/12/2008	1.08	11.43	13.92					14.99
ING Vysya	Secure Fund	13.7790	24/12/2008	0.94	6.29	2.21	2.48		22.67		36.61
LIC	Money Plus - I Bond	11.5233	23/12/2008	0.89	6.35	10.23	14.86				15.23
Aviva	Protector Fund	12.5820	23/12/2008	0.88	7.14	10.92	-52.54	12.84			25.82
Bajaj	Debt Plus Pension Fund	14.0570	24/12/2008	0.88	9.55	11.93	13.65		32.64		37.26
Aviva	Pension Protector Fund	11.3400	23/12/2008	0.87	6.88	11.31	13.51				13.4
Future Gen	Future Pension Secure	11.3233	24/12/2008	0.83	11.29						13.23
Bajaj	Premier Debt Fund	12.9740	24/12/2008	0.82	10.23	12.55	14.02	14.49			13.44

China’s big challenge in 2009: a better path

Eight is an important number in China.

Its association with good fortune makes it a big hit for licence plates and mobile phone numbers. It’s no accident that the Beijing Olympic Games opened on the eighth of the eighth, 2008.

But the number has another significance. If GDP growth falls below 8%, according to popular wisdom, China’s masses will turn the country into a simmering cauldron of unrest.

That thesis has been bandied about by politicians and economists for years. But it could soon be put to the test.

In 2009, China’s growth is expected to fall to 7.8% according to HSBC economists, from almost 12% in 2007, driven down by the collapse in China’s exports to the crisis-wracked developed world.

Social unrest is a rising threat in China. Recorded incidents increased almost eight-fold between 1994 and 2005—after which the government stopped giving comparable data.

When growth fell from 11% to 4% in 1989, ugly protests erupted. While the state apparatus has been tolerant of recent peaceful sit-ins by factory workers, co-ordinated action might leave only two options: Impose order the hard way, or renegotiate the terms of government.

Fortunately, the “theory of eight” is probably wrong. What really matters isn’t how much China’s growth falls, but what happens to unemployment.

The two aren’t perfectly linked. A collapse in capital-intensive industries, for example, would have less of an effect on jobs than a more modest decline in lower-value, labour-intensive work. Besides, unemployment isn’t the only reason the masses complain. As they become more prosperous, they are more likely to protest about non-economic issues such as pollution and corruption.

What’s certain is that unemployment is rising. Urban joblessness is already at 9.4%, according to the Chinese Academy of Social Sciences. The real figure may be higher, and the official national unemployment figure of 4% is almost certainly too low. Export sectors alone account for around 50 million employees, according to HSBC estimates—and around four million have been laid off this year.

Meanwhile, economic volatility, which may have more impact on the lives of China’s masses than any single number, is rising.

A stable economy rests on two pillars: consumer and government spending, which tend to move slowly—say, 1% or 2% a year. But 51% of China’s growth comes from investment and exports, which can fluctuate by tens of percent a year. Huge falls in the equity and housing markets add to a sense of rapid, uncomfortable change—especially in a country only three decades into its modern economic history.

Can China manage this tricky period?

Its almost miraculous economic achievement until now suggests it can. Government plans to spend Rmb4 trillion ($584bn) will help. If just 40% of that is new money, it should lift GDP growth by around 3 percentage points in 2008 and 2009—though that’s already factored into the 7.8% growth estimate. If implemented fast enough, it will absorb masses of workers into meaningful employment, in coastal cities and in the rural interior.

The question is what happens after the stimulus.

At best, China will use the giant spending spree as a prophylactic against discontent while managing the transition to a broader consumption-led economy—where widespread, stable employment means the risk of unrest is systemically reduced. At worst, it will be no more than a stopgap, until the US demand picks up again.

Finding the better path will be China’s big challenge in 2009—and it has nothing to do with luck.-livemint