INTRODUCTION:

Mutual Fund:

A mutual fund is a financial intermediary that allows a group of investors to pool their money together with a predetermined investment objective. When a person invests in a mutual fund, it means he is buying units or portions of the mutual fund and thus on investing becomes a shareholder or unit holder of the fund. Investment in mutual funds in India means pooling money in bonds, short-term money market, financial institutions, stocks and securities and dishing out returns as dividends. Mutual Fund industry has witnessed several mergers and acquisitions from 2004 onwards after the completion of fourth phase in its history. This is a continuing phase of growth of the industry through consolidation and entry of new international and private sector players⁽²⁾

Unit Linked Insurance Plan:

Unit Linked Insurance Plan (here in after called ULIP) is a life insurance solution that provides the client with the benefits of protection and flexibility in investment. It is a solution which provides for life insurance where the policy value at any time varies according to the value of the underlying assets at the time. ULIP came into play in the 1960s and became very popular due to the wide spread popularity because of the transparency and the flexibility which it offers to the clients.

Consumer Behaviour:

Consumer Behaviour is the study of when, why, how, and where people do or do not buy a product or service. It studies characteristics of individual consumers such as demographics and behavioural variables in an attempt to understand peoples wants

Perception:

Perception can be described as “how we see the world around us”. Each person recognises, selects, tastes and interprets the stimuli in his own individual manner based on his needs, values and expectations and this is known as perception. ⁽¹⁾ Since each individual’s needs, motives and expectations are unique therefore each individual’s perception is unique.

About UTI Mutul Fund:

UTI Mutual Fund was created as a SEBI registered fund like any other mutual fund. After passing over three phases, in the fourth phase during 1996-2003 UTI was reorganised into two parts 1. Specified Undertaking of UTI and 2. UTI Mutual Fund. In order to distance Government from running a mutual fund the ownership was transferred to four institutions; namely State Bank of India, Life Insurance Corporation of India, Bank of Baroda and Punjab National Bank each owning 25%. UTI-ULIP primarily attempts to fulfill investment needs of an investor with insurance needs of an insurance seeker. Fresh investment can be considered in the units of UTI Unit Linked Plan 71, a unit-linked insurance plan (ULIP) with a track record of 40 years. UTI-ULIP is an open-end tax-saving-cum-insurance scheme and its investment objective is primarily to provide returns through growth in net asset value or through income distribution and reinvestment thereof. (10).

NEED OF THE STUDY:

With the advancements in the information technology, investors are able to know everything and are able to compare various investment avenues. The market is ever changing, and the business organisations have to adapt new strategies for the development of their businesses. Private insurance companies are allowed to do business in ULIPs so competition in the financial service sector will be tough enough. Service providers have to concentrate to attract new customers and retain existing customers also by providing better services. The present study is an attempt to enable one to study on perception levels of investors in the sample unit and to adapt new ways and means to serve the customers to stay in the market to gain more business.

OBJECTIVES OF THE STUDY:

The present study is to examine the investor perception of UTI’s ULIP scheme basing on the responses of investors to the questionnaire, and interpret the opinions there from. Further the sub objectives of the study are as follows:

1. To know the likes and dislikes of investors about UTI ULIP

2. To know whether UTI ULIP is better alternative to other investment avenues (traditional policies, bank FDs, postal savings and infrastructure bonds)

3. To know whether more types of insurance coverage are to included in UTI ULIP

4. To identify investors awareness about SEBI role in UTI ULIP.

5. To find investors satisfaction with the services of the sample unit.

6. To draw conclusions and suggestions.

SCOPE OF THE STUDY:

The present study is limited to Unit Linked Insurance Plan of UTI Mutual Fund. The study is based on the responses of the investors belonging to Khammam town in state of Andhra Pradesh.

METHODOLOGY:

The methodology in the present study is regarding selection of sample, data sources, analysis and interpretation of data. Tables, percentages, chi-square test and rank scale are used for effective presentation. The source of data is primary in nature. Responses are obtained through a structured questionnaire distributed among the respondents at convenience and also through personal interview. The total data has been taken into thirteen tables. Secondary data has also been relied upon. Organisation website and brochure are refereed to study the features and benefits of the product. Text books and journals are referred for concepts and more information.

SAMPLE DESIGN:

The sampling technique used is convenience sampling. The study is confined to Khammam town. The total sample size is sixty two (124) and is divided into employees (88), business people (22) and others (14) who include professionals, self employed

LIMITATIONS OF THE STUDY:

1. The work is limited to Khammam town and confined to UTI Mutual Fund’s ULIP scheme

2. The sample size is only sixty two (124) which may not represent the whole investor base.

3. The study is based on the replies given by the respondent investors to the pre-conceived questionnaire which may be out of their level of knowledge, behaviour and perceptions about the organization and the questions, so the results may not be widely applicable.

4. Secondary data which has been collected from the company’s website, books and journals depends totally on the prudentiality of the data published.

ANALYSIS AND INTERPRETATION:

Table 1 Occupation of investors:

Occupation	No. of respondents	Percent
Employees	88	70.97
Business	22	17.74
Others	14	11.29

Source: questionnaire (primary data)

Interpretation:

Table 1 consist information about the occupation of the investors. Out of 124 respondent investors, 88 (70.97 percent) are employees, 22(17.74 percent) are business people and 14 (11.29 percent) are others who include professionals and self employed.

Table 2 Age group of investors:

Age group (years)	No. of respondents	Percent
25-40	38	30.65
41-50	66	53.23
51-55	20	16.13

Source: questionnaire (primary data)

Interpretation:

Table 2 consist information on the age of the investor which is taken into three groups. 38 respondents (30.65 percent) are in the age group 25-40, 66 respondents (53.23 percent) are in the age group of 40-50 and 20 respondents (16.13 percent) are in the age group of 50-55. 84 percent of the investors are in the age group of 25-50

Table 3 Income range of investors per month

Income range (Rs.)	No. of respondents	Percent
10000-20000	22	17.74
20000-30000	42	33.87
30000-40000	36	29.03
40000-50000	14	11.29
50000 above	10	8.06

Source: questionnaire (primary data)

Interpretation:

Table three consist information on the monthly income range of the investor group and it is divided into five groups. 22 respondent investor belong to Rs. 10000-Rs.20000 income range, 42 investors (33.87 percent) belong to Rs.20000-Rs30000 range, 36 (29.03 percent) to Rs.30000-40000 range, 14 (11.29 percent) to Rs.40000-Rs.50000 and 20 (8.063 percent) to Rs.50000 above range. 81 percent of the investors are below Rs.40000 income earners.

Table 4 No. of years investing with UTI Mutual Fund

Years of investment	No. of respondents	Percent
Less than 5	28	22.58
More than 5	96	77.58

Source: questionnaire (primary data)

Interpretation:

Table 4 consist information on the number of years the investors are investing with UTI. Out of 124 respondents, 28 respondent investors (22.58 percent) are investing in uti for less than 5 years and 96 (77.58 percent) for more than 5 years. Most of the investors are interested in long term investment.

Table 5 Source of knowledge about UTI ULIP:

Source of knowledge	No. of respondents	percent
Friends and colleagues	32	25.81
Advertisement	8	6.45
Agent/distributor	84	67.74

Source; questionnaire (primary data)

Interpretation:

Table 5 consist information on the source from where the investors knew about the product. 32 investors (25.81 percent) have came to know about uti ulip from friends and colleagues, 8 (6.45percent) from advertising and 84 (67.74 percent) through agents. 2/3 rd of the investors know about uti ulip through agents/distributor who are the major source of information.

Table 6 Reasons for selecting UTI ULIP (note: respondents have more than one option so total would be more than 124 and percentages are not taken)

Reasons	No. of respondents
Insurance planning	116
Retirement provision	84
Financial needs	108
Children future	100
Tax benefit	105

source: questionnaire (primary data)

Interpretation:

Table 6 gives information on the reasons for selecting UTI ULIP. Five reasons are taken for which respondents have chosen more than one reason. 116 respondent investors have invested for insurance, 105 to avail tax benefits, 84 for retirement provision, 108 to meet future financial needs, 100 for children future needs Most of the investors have given importance for insurance benefit, tax benefit and retirement provision

Table 7 Priority given to the reasons to select UTI ULIP

S.No

Reasons

RS X

Total

Rank

Weightage

Low premium

22 *

88 **

124

260

High risk coverage

176

108

124

356

Tax benefits

128

138

124

334

High returns

104

124

302

III

Total

124

1252

Interpretation:

Table 7 is on the priority the respondents to the reasons for selecting UTI ULIP. Five reasons are taken and respondents have chosen more than one reason. Rank is given basing on the priority and is multiplied with weightage to get the weighted mean. Reason with highest total of weighted mean is given highest priority. Respondent investors have given highest priority to risk coverage. Insurance means coverage of financial loss through insured peril. As there are many insurance companies in competition high risk coverage is necessary. Tax benefits and high returns are given second and third priority. They are to be given equal weightage because investors compare other avenues expecting high returns. Low premium is given fourth priority.

Table 8 Joint life insurance, whole life insurance, health insurance can be included in UTI ULIP

Response	No. of respondents	Percent
Better to include	106	85.48
no need to include	18	14.52

Source: Questionnaire (primary data)

Interpretation:

Table 8 is about the respondents views on the inclusion of other types of insurance coverage in UTI ULIP. 106 respondents (85.48 percent) are perceiving that inclusion of whole life insurance in UTI ULIP would be better and 18(14.52 percent) are perceiving that no need of whole life insurance. It can be concluded that whole life insurance can be included in UTI ULIP.

Table 9 UTI ULIP is better alternative (preferable) to traditional insurance policies, banks’ FDs/postal savings/ infrastructure bonds.

Response	No. of respondents	Percent
Yes	100	80.65
No	24	19.35

source: questionnaire (primary data)

Interpretation:

Table 9 tells about the respondents perception on whether UTI ULIP is a better alternative compared to other savings/investment avenues. 50 respondent investors (80.65 percent) are in favour of UTI ULIP compared to other savings, but 12 (19.35 percent) are in favour of other savings compared to UTI ULIP. 81 percent of the investors are favoring UTI ULIP than to other savings avenues. More advertisements and campaigns are needed.

Table 10 Regarding investment of UTI ULIP funds, not less than 60 percent is invested in debt profile and not more than 40 percent in equities. The profile should be flexible.

Response	No. of respondents	Percent
Yes	102	82.26
No	22	17.74

Source: Questionnaire (primary data)

Interpretation:

Table 10 consist information on the respondents’ view on the profile of the investment of UTI ULIP funds. 102 respondent investors (82.26 percent) are interested in profile flexibility, and 22 investors (17.74 percent) are not interested in profile flexibility. This gives investors chance in choosing their portfolio.

Table 11 At present the period of the plan is 10/15 years. This can be flexible

Response	No. of respondents	Percent
Yes	105	84.68
No	19	15.32

Source: Questionnaire (primary data)

Interpretation:

Table 11 gives information on the respondents’ view on whether the plan period may be flexible instead of fixed terms. 105 respondents (84.68 percent) are perceiving that the period of the plan can be flexible and 19 respondent (15.32 percent) are perceiving that no need of any flexibility. Period of the plan can be flexible for investing suitable for all ages.

Table 12 Awareness of the SEBI role in UTI ULIP.

Response	No. of respondents	Percent
Yes	24	19.35
No	74	59.68
no idea	26	20.97

source: questionnaire (primary data)

Interpretation:

Table 12 is on the respondents’ awareness level about SEBI role in UTI ULIP. 24 respondent investors (19.35 percent) have awareness about sebi role in ulip, 74 (59.68 percent) investors are unaware of the role and 26 (20.97 percent) investors have no knowledge about sebi. Awareness is highly needed.

Table 13 Satisfaction of investors with the services of the organization

Opinion	No. of respondents	Percent
Satisfied	110	88.71
not satisfied	14	11.29

source: questionnaire (primary data)

Interpretation:

Table 13 gives information on the opinion of the respondents about their satisfaction with the services of the organization. 110 respondent investors (88.71 percent) are satisfied with the services of the organisation, but 14 (11.29 percent) of them are not satisfied.

STATISTICAL ANALYSIS (6):

Application of Chi-square c 2 (Data taken from question no. 9)

Hypothesis: UTI-ULIP is better to traditional insurance policies, Banks’ FDs, postal savings and infrastructure bonds alternative (preferable)

(Note: frequencies of both “business” and “others” classes are combined)

Occupation	Response
Occupation	Yes	No	Total
Employee	76	12	88
Business and others	24	12	36
Total	100	24	124

Observed frequencies(O_i)	Expected	frequencies(Ei) (O_i-Ei)²/E_i
76	70.97	0.3565
24	29.03	0.8715
12	17.03	1.4857
12	6.97	3.6300
Total 124	124.00	å(O_i-E)_i²/E_i =6.3437

v = (r-1) (c-1) = (2-1) (2-1) = 1 r = no. of rows 2 c= no. of columns for v = 1, table value c²_0.05 = 3.84 calculated value = 6.3437

Calculated value is less than table value, hence hypothesis is accepted, and it can be concluded that UTI-ULIP is better alternative (preferable) to traditional insurance policies, Banks’ FDs, postal savings and infrastructure bonds

FINDINGS:

1. Many of the respondent investors are in the age group of 25-40 and 40-50. Their income range is between Rs.10000-Rs.40000

2. Many respondent investors are with UTI for long term not only investing in ULIP but also with other schemes of the organisation.

3. Investors who are employees, some of them are tax payers and are investing to avail tax benefit, and also for insurance. Most of them have invested for fifteen years for retirement provision and also for children higher education and to meet future financial needs.

4. Business people are of thought that ten years scheme is beneficial so that the amount can be used in business without going for loans.

5. Only those who contact the distributor/advisor are knowing more about the scheme and from those who have current investors. Effect of advertisement is meagre.

6. The investors are in favour of UTI ULIP showing the reason that they can get benefits of capital gains simultaneously with life insurance. And also the returns are higher compared to traditional insurance policies, banks’ fixed deposits, bonds and other companies’ ulip schemes.

7. Investors are perceiving that joint life insurance, health and whole life insurance can be included in UTI ULIP.

8. Investors opine that investment profile can be flexible and also period of investment.

9. Some of the investors are lacking knowledge on the role and rules and regulations of SEBI and their applicability to mutual fund organizations, and some of them are unaware of the existence of sebi.

10. Most of the respondents are satisfied with the services of the organisation. Some of them are not satisfied with services like late intimation of premium notice, sending late of statements.

CONCLUSIONS AND SUGGESTIONS:

1. Successful strategy requires an understanding of the unique value that will be the source of the oprganisation’s competitive advantage. The uniqueness and magnitude of the customer value are ultimately determined by customer perception. Stronger the customer value, stronger the competitive advantage. Values are like beauty, it is in the eye of the beholder. Competitive advantage is achieved by creating more value than the competitors, and value is defined by customer perception.

2. A Unit Link Insurance Policy (ULIP) enables the buyer to secure some protection for his family in the event of his untimely death and at the same time provides him an opportunity to earn high returns on the premiums paid. It saves the investor/insurance-seeker from the hassles of managing and tracking a portfolio of products

3. Respondent investors generally save while they earn ie: between the age group of 25-30 and after meeting family commitments. Investment should be more attractive.

4. Along through agents, the role of other sources of information is to be enhanced. The organisation has to go for wide advertisement with proper advertising mix which has high reach. Go for rural campaign. Provide information in regional languages. Improve tie ups with rural post offices and banks for more business.

5. More types of insurance coverage may be included as competition is increasing and private life insurance companies are providing more coverage under various policies. With this investor can stay for long time with the organization.

6. Comparisons with other investment/saving avenues (schemes) are to be made and explained to the customers. Customers’ needs and behaviour are changing. Investment pattern can be left over to the investor’s choice on each year’s premium, so that depending on the market position and future expectations the investor switch over his funds from equity to debt instrument and vice-versa.

7. ULIP be designed introducing flexible time periods with minimum 5 years term by which low income group people can afford and buy long term insurance policy and also depending on their needs.

8. Get regular feedback regarding investor perception level on organisation services and scheme performance. Customer retention strategies are to be designed

9. Bring awareness about the regulatory authorities and its rules and regulations, so that inventors perceive that the schemes are monitored from time to time and the money invested is safe.

10. Company can send health tips (like yoga and regular exercises) and accident prevention measures (like no use of cell phone and alcohol while driving).

11. Training may be given to the sales personnel on customer services, creating awareness on the organisation among the public and regulatory authorities.

REFERENCES:

1. Kotler Philip and Keller Kevin Lane , Marketing Management, 12^th ed, Pearson Education, New Delhi, (2006), pp 164-181

2. Avadhani VA, Security Analysis and Portfolio Management, 8^th ed, Himalaya Publishing, House, Mumbai, (2006), pp 514-560

3. Nair Suja S., Consumer Behaviour

4. Leon G Schiffman and Leslie Lazar Kanuk, Consumer Behaviour, 9^th ed, pearson education, (2007), p 170

5. Dr. Gupta. S.P, Statistical Methods, Sultan Chand and Sons, New Delhi, (1991), pp A.4.3-4.49

6. Kothari.C.R., Research Methodology (methods and techniques), 2^nd Ed, New Age International Publications, New Delhi, (2007), pp 75-82, 236-246

7. Sanjeeva Reddy G, Customer perception towards private life insurance companies policies with reference to Bangalore city, Indian Journal of Marketing, Vol. XXXV, No.4, (April 2006), pp 9-14

8. Raja Rajen V. Anjeko, Indian Investors’ Investment Characteristics, Finance India, Indian Institute of Finance, Vol. XXIV, No.4, (Dec 2010), pp 1275-1294

Received on 07.03.2013 Modified on 19.04.2013

Asian J. Management 4(4): October –December, 2013 page 254-259