To solve this question, the user needs to know the correct usage of reported speech and pronouns.

The given sentence is in the form of a statement. The sentence is talking about a third person who is believed to be very rich.

Now, let's go through each option and explain why it is right or wrong:

A. He said he is very rich. - This option is incorrect. The given sentence is not in the form of reported speech and there is no indication of who made the statement. Moreover, the usage of the pronoun 'he' is ambiguous, as it is unclear who 'he' refers to.

B. People say he is very rich. - This option is correct. The sentence talks about what people are saying about the third person. Therefore, the correct usage of 'People say' is used to convey this message.

C. He said it is very rich. - This option is incorrect. This option is using the wrong pronoun 'it' instead of 'he'. 'It' is used to refer to non-living things, whereas the subject in the given sentence is a person.

D. People say it is very rich. - This option is incorrect. This option is using the wrong pronoun 'it' instead of 'he'. 'It' is used to refer to non-living things, whereas the subject in the given sentence is a person.

Therefore, the correct answer is:

The Answer is: B. People say he is very rich.