Over 83 per cent unit-linked insurance plans (Ulips) with equity-debt investment ratio of 80:20 have outperformed benchmark and other indices in the current bear market.
A study of 112 growth schemes launched more than a year ago indicates that the net assets value (NAVs) of 93 schemes have declined in the range of 25-53 per cent, whereas the Sensex and the Nifty have fallen 53.4 per cent from their peaks. NAVs of the remaining 19 schemes have dipped by over 54 per cent each from their peaks.
Growth-oriented Ulips with an investment bias in favour of equity have suffered the most compared to balanced, secured and income funds. While NAVs of growth funds have declined by 30-60 per cent, those for balanced funds have dropped between 20 per cent and 30 per cent. In case of secured, income and conservative funds, the decline has been less than 10 per cent from their highs.
ICICI Pru L.Link Maximiser (Growth) II, ICICI Pru L.Time Maximiser (Growth) II, Bajaj Allianz Life Insurance - Pure Stock Fund, Tata AIG Growth Maximiser Fund Life and SBI Life Insurance Unit Plus Equity fund have outperformed the benchmark indices. NAVs of these schemes have declined by less than 40 per cent. SBI Life Insurance Group Growth Fund has been the least affected in the current market as its NAV has declined by only 13 per cent to Rs 12.35 per unit.
The Life Insurance Corporation (LIC), the largest player in the insurance industry, has also witnessed a decline in its NAVs, but its schemes have outperformed the benchmark indices. NAVs of LIC Money Plus Growth Fund, LIC Bima Plus Risk, LIC Profit Plus Growth Fund and LIC Market Plus Growth Fund have decline between 23 and 38 per cent.
Equity schemes of Tata AIG have been affected the most with the NAVs of Tata AIG Whole Life Midcap Equity Fund, Tata AIG Equity Fund - Group Pension and Tata AIG Equity Fund - Life falling by almost 60 per cent from their peaks in early 2008.
But the decline in indices has not prevented insurance firms from launching fresh Ulips. This year, nearly 250 new schemes have been launched. Insurance agents also continue to hawk Ulips more aggressively than traditional covers since it earns them higher commission.
