MARKETING OF FINANCIAL

SERVICES

ANSWER: 1

Title: Policyholder Empowerment: A Public Rela ons Campaign to Promote Life Insurance
Awareness and Educa on

1. Summary: The Public Rela ons campaign aims to raise awareness of the life
insurance sector and educate policyholders about their rights in collabora on with the
Insurance Regulatory and Development Authority of India (IRDA). By highligh ng the
importance of life insurance and enhancing policyholder knowledge, the campaign will boost
trust, promote responsible decision-making and promote a transparent, customer-focused
industry.

2. Introduc on: The life insurance sector plays a key role in protec ng individuals and
their families from unpredictable risks. However, lack of awareness and limited knowledge
about life insurance o*en prevents policyholders from making informed decisions. This PR
campaign seeks to bridge this gap by providing policyholders with comprehensive
informa on and knowledge to make confident decisions.

3. Objec ves:
a. Raise awareness: Raise public awareness of the importance of life insurance and its
benefits for individuals and society.

b. Educate policyholders: Inform and educate policyholders about their rights, policy
terms, claims processes and other key aspects of life insurance.

C. Promote trust and transparency: Create a trustworthy image of the life insurance
sector by promo ng transparency, customer orienta on and fair prac ces.

d. Encourage responsible decision-making: Encourage policyholders to evaluate their

insurance needs, select appropriate policies, and maintain coverage throughout their lives.

4. Target group:
a. Exis ng policyholders: Inform them about details of insurance policies, rights and
available support services.

b. Prospec ve policyholders: Emphasize the importance of life insurance, dispel myths

and address concerns.

C. General Public: Create awareness of the benefits and role of life insurance in financial
planning and risk management.

5. Key Strategies and Tac cs:

a. Engage with Tradi onal Media: Work with leading newspapers, magazines and TV
channels to publish ar cles, interviews and infographics on the importance of life insurance,
case studies and policyholder stories.

b. Digital media outreach: Use social media pla0orms, blogs and influencers to
disseminate engaging and informa ve content, including videos, FAQs, webinars and
interac ve quizzes.

C. Partnerships with influencers and celebri es: Work with influencers and
celebri es to promote the campaign message, share personal stories and par cipate in live
mee ngs with policyholders.

d. Policyholder Workshops and Seminars: Conduct interac ve sessions across ci es,

towns and rural areas to educate policyholders about their rights, policy features and claims
processes. Experts can clarify doubts and address specific concerns.

e. Work with Educa onal Ins tu ons: Work with schools, colleges and universi es to
include life insurance educa on in their curriculum and hold workshops for students and
faculty.
f. Increases awareness in rural areas: Conduct roadshows, village level mee ngs and
community programs in rural areas to explain the benefits of life insurance and simplify
complex insurance concepts.

g. Customer Service Improvements: Work with insurers to improve customer service,

streamline claims processes, and establish a dedicated policyholder helpline to address
policyholder concerns and ques ons.

h. Working with Insurance Agents: Educate and train insurance agents on campaign
objec ves, policy details and their role in ensuring policyholder rights are protected.

6. Key messages:
a. "Secure your future: Life insurance is an essen al tool for financial protec on and
long-term planning."

b. "Know your rights: Familiarize yourself with the terms of your policy, the claims
process and available support services."

c. "Transparency and trust: We strive for a customer-oriented and transparent life

insurance industry."

d. "Policyholder Empowerment: Make informed decisions to meet your evolving

insurance needs."

e. "Your Insurance Partner: We're here to support and help you throughout your life
insurance journey."

7. Evalua on and Measurement:

a. Surveys and Surveys: Conduct pre- and post-campaign surveys to assess changes in
awareness, knowledge and percep on of target audiences.

b. Media Coverage and Reach: Monitor media coverage and monitor campaign reach
across various media channels.

c. Social Media Analy cs: Analyze engagement, reach and sen ment across social
media pla0orms to evaluate campaign impact and iden fy areas for improvement.

d. Policyholder Feedback: Collect policyholder feedback on their experience with

insurance companies, claims processes and overall sa sfac on.

E. Insurance Sector Sta s cs: Track changes in policyholder behaviour, insurance

penetra on and number of queries and complaints received by IRDA.
8. Budget and Timeline: Create a detailed budget, allocate resources, and establish
a meline for each phase of the campaign to ensure op mal use of funds and mely
execu on.

Conclusion:
Through this comprehensive Public Rela ons campaign, in collabora on with IRDA, we are
trying to create awareness about the life insurance sector and educate policyholders about
their rights. By emphasizing transparency, trust and customer centricity, we will enable
policyholders to make informed decisions and promote a robust and responsible life
insurance industry in India.
 ANSWER: 2

Title: Re rement Planning for Amit Chopra: Building a Secure Future

1. Introduc on: Re rement planning is a cri cal aspect of financial stability that
ensures a comfortable and secure future. This plan aims to help Amit Chopra, a 31-year-old
pharmaceu cal industry professional, build a comprehensive re rement strategy that will
enable him to re re at the age of 60. me horizon we will develop a personalized pension
plan tailored to Indian standards.

2. Assessing Current Financial Situa on: To create an effec ve re rement

plan, it is essen al to understand Amit's current financial situa on. This includes an
assessment of his income, expenses, assets, liabili es and investment por0olio. Assuming a
medium level of income and expenditure, we will proceed with the following assump ons:
• Annual Income: Rs. 15 million
• Annual Expenditure: Rs. 8 million
• Current savings and investments: Rs. 5 lakhs
• Outstanding debts: None

3. Defining re rement goals: Amit's re rement plan should align with his desired
lifestyle and financial goals. Key considera ons for Amit and his family include maintaining
their current standard of living, ensuring financial security and accoun ng for infla on.
Given these factors, we will assume the following re rement goals:
• Required Annual Income: Rs. 12 million (adjusted for infla on)
• Re rement age: 60 years
• Life expectancy: 85 years

4. Determining Pension Corpus: To es mate the pension corpus required to

achieve Amit's re rement goals, we consider factors such as expected rate of return,
infla on and life expectancy. Assuming a conserva ve rate of return of 8% per annum and an
average rate of infla on of 5%, we can calculate the required pension corpus using the
various pension calculators available.
Based on these assump ons, the es mated pension corpus required for Amit to re re
comfortably at the age of 60 would be around Rs. 3 crores. This corpus should enable him to
generate a sustainable income throughout his re rement.

5. Re rement Investment Strategy: In order to accumulate the required corpus

for re rement, Amit needs to implement a well-diversified investment strategy. Key
considera ons in crea ng an investment plan include Amit's risk tolerance, investment
horizon, and the need for regular savings and regular checks. We will suggest the following
investment op ons:

a. Equity Investments: Amit may consider inves ng in equity mutual funds or stocks to
tap into long-term growth poten al. In the early years of an investment horizon, it is
advisable to have a significant alloca on to stocks to benefit from compounded returns.

b. Debt investments: To balance the investment por0olio and mi gate risk, part of the
pension savings can be allocated to debt instruments such as fixed deposits, bonds or debt
mutual funds. These investments ensure stability and regular income.

c. Systema c Investment Plans (SIPs): Amit can start monthly SIPs in mutual funds to
systema cally invest a fixed amount over me. This approach helps in rupee cost averaging
and reduces the impact of market vola lity.

d. Na onal Pension Scheme (NPS): Amit may consider opening an NPS account which
provides tax benefits and long-term re rement investment op on. Regular contribu ons to
NPS can help amass a significant corpus over me.

e. Individual Re rement Accounts (IRAs): Amit can also explore individual re rement
accounts or re rement plans offered by insurance companies. These plans provide tax
benefits and offer a combina on of insurance cover and investment growth.

6. Regular monitoring and adjustments: Re rement planning is a dynamic

process that requires regular monitoring and adjustments based on changing circumstances
and market condi ons. Amit should review his re rement plan at least once a year and make
necessary adjustments to his investment por0olio based on his risk tolerance, market
performance and re rement goals.

7. Tax Planning: Tax planning is an integral part of re rement planning. Amit should
explore tax saving investment op ons like Employee Provident Fund (EPF), Public Provident
Fund (PPF) and Tax Saving Mutual Funds to op mize his tax liability and maximize his
re rement savings.
8. Insurance Cover: To ensure financial security for his family in case of unfortunate
events, Amit should consider adequate life insurance. A term policy with a cover amount
based on his current and future financial obliga ons would be a prudent choice.

9. Seeking Professional Advice: Given the complexity of re rement planning and

the importance of making informed decisions, Amit may benefit from consul ng with a
qualified financial planner or advisor who specializes in re rement planning. A professional
can provide personalized advice, assess risks and recommend appropriate investment
strategies based on Amit's specific needs and goals.

Conclusion:
By crea ng a comprehensive re rement plan, taking into account Amit Chopra's current
financial situa on, re rement goals and risk tolerance, we can create a plan to re re
comfortably at age 60. Through a well-diversified investment strategy, regular monitoring,
tax planning and insurance, Amit can secure his financial future and enjoy a comfortable
re rement lifestyle. Seeking professional advice will further enhance the effec veness of the
re rement plan and ensure that it is aligned with Amit's unique circumstances and long-
term goals.
 ANSWER: 3A

Recommenda ons for pure risk life insurance coverage:

For Prashant Pandey's net risk life insurance cover requirement of Rs 1.5 million, a term plan
would be the most suitable op on. Here's why:

1. Affordability: Term plans offer higher coverage at lower premiums compared to ULIPs.
Prashant can secure a substan al coverage of Rs 1.5 million at a more cost-effec ve
premium. This ensures adequate protec on for his family in case of any unfortunate event.

2. Simplicity: Term plans have a straigh0orward structure, with no investment component.

This simplicity ensures that the en re premium goes towards the life insurance cover,
providing a comprehensive safety net for Prashant's family. Since the primary objec ve is to
protect against the financial risks associated with premature death, a term plan effec vely
fulfills this requirement.

3. Cost Effec veness: ULIPs come with addi onal fees and charges due to the investment
component involved. These fees can affect overall returns and reduce some of the insurance
coverage. On the other hand, term plans offer pure life insurance coverage, making them a
more cost-effec ve op on. Prashant can use the cost savings to explore other investment
avenues for wealth crea on and financial goals.

4. Flexibility: Term plans provide flexibility in terms of dura on of insurance. Prashant can
choose a term that matches his financial goals and obliga ons, such as his re rement age or
un l his daughter becomes financially independent. This flexibility ensures that he is insured
during cri cal periods when financial support is necessary for the well-being of his family.

Conclusion:
Based on Prashant's net risk life insurance cover requirement of Rs 1.5 million, term plan is
the recommended op on. It offers affordability, simplicity, economy and flexibility in
providing comprehensive life insurance and ensures financial security for Prashant's family.
 ANSWER: 3B

Investment in daughter's higher educa on:

Prashant and Pri 's goal of inves ng in their daughter's college educa on, which is
es mated to be needed in 15 years, requires a long-term investment strategy with poten al
growth. Here is the recommended procedure:

1. Start early: Given the 15-year me horizon, it is advantageous to start early. Prashant
and Pri should start inves ng as early as possible to benefit from the power of
compounding and accumulate a sizeable corpus over me.

2. Equity Investments: Given the long investment horizon, Prashant and Pri may
consider alloca ng a significant por on of their investments to equity-based instruments.
Stock investments, such as diversified stock mutual funds or index funds, have historically
provided higher returns over the long term. However, they come with market risks and the
pair should be prepared to ride out market fluctua ons.

3. Systema c Investment Plan (SIP): Prashant and Pri can opt for Systema c
Investment Plan (SIP) in mutual funds which allows them to invest a fixed amount at regular
intervals. This disciplined approach helps in rupee cost averaging and reduces the impact of
market vola lity.

4. Asset Alloca on: To reduce risk, it is important to maintain a diversified investment

por0olio. Prashant and Pri may consider diversifying their investments into different asset
classes such as equity, debt and hybrid funds based on their risk tolerance and financial
goals.

5. Regular monitoring and review: Prashant and Pri should regularly review their
investment por0olio to ensure that it remains in line with their financial goals and risk
appe te. They may need to make adjustments based on changing market condi ons, their
daughter's evolving educa onal plans, and their overall financial situa on.

6. Educa on-Specific Investment Op ons: They can explore educa on-specific

investment op ons like specialized educa on savings plans or child educa on insurance
offered by reputed financial ins tu ons. These plans are designed to provide a lump sum or
regular payments during the child's higher educa on and provide financial support when
needed.

Conclusion:
To invest in their daughter's higher educa on, Prashant and Pri should adopt a long-term
investment approach focusing on equity investments, systema c investment plans (SIPs),
asset alloca on and regular monitoring. GeIng started early, maintaining a diversified
por0olio and seeking professional advice will improve their investment strategy and ensure
it is aligned with their specific financial goals and risk appe te.