This article from Outlook Money makes no sense to me. Why should a person opt for ULIPs, they are so expensive. Outlook Money is only interested in getting ads from ULIP companies for writing such misleading articles.
RE:what a waste of time
by Digvijaysinh Kosamia on Jan 21, 2008 04:25 PM Permalink
Sorry Vikas, Not only me but all of them who have really identified their financial needs and security will disagree with you. As mentioned in above aricale they have always prefered an individual to go for TERM plan insted of regular ULIP. If you ask for your life cover with icrease in your corpus than ULIP is only option but if you do not required any secure corpus for your family afer you than you shoudn't be thinking for ULIP.
RE:what a waste of time
by Vikas Vadgama on Jan 21, 2008 06:43 PM Permalink
I agree with you but what i don't like is that outlook money is writing this article only b'cos they are getting ad money from ulip companies. i am mutual fund agent and i always speak the truth without getting any ad money. so pls come to me and give me some business.
RE:what a waste of time
by sathyanarayana venkatachala on Jan 22, 2008 09:25 AM Permalink
I think it is better to go for NSC. No hidden charges, no premium charges, no entry and exit loads. Even the returns are less your money is very safe and secured. OLD IS GOLD.. please share your thoughts.
It is a good writeup. But a few pts need clarifications from author. 1. Many people have started ULIP pension schemes in view of 80CCC Itax benefit(merged since fin yr 05-06 in overall 1 lak limit of 80C). Many of this lot have completed mandatory lockin of 3 yrs and are contemplating abandoning the stream surrendering these pols. When the author advices them to continue till maturity what is the penalty the ins co will levy to send back the amt after selling accumulated units at prevailing NAvs(be it eq or debt or hybrid ins funds the polholder has opted). 2. Its not clear why the author gives reco to put exrtra investible cash into ULIP(in Equity funds or Debt/cash funds) with TopUp facility.Because there are several demerits in this like you pay prem.allocn charge upto 2%(absent in MFs from 1/1/2008 if done through MF serv centres or online).Also therer is a lockin of 3 yrs for topup prem.in ULIP (no such lockin in MFs, at worst an exit charge of 1%, if taken out before 1 yr). Only merit being you can increase your Sum assured (SA) at a later date which can always be done later also by withdrawing from Mfs etc. The writer may clarify what are his intentions in asking readers to do topup
I'm not sure if many folks would agree with the last sentence (2nd paragraph) under "Don't overdo it". For the ULIP to be able to provide an insurance cover of 5 times an individual's salary, the premium would amount to around 35% of the the individual's annual salary. (For exmaple, someone earning 5 lakhs would be required to pay a premium close to 1.5 lakhs or more for an insurance cover of 25 lakhs (5 times). This would be very difficult for most, even though it would be good. Whereas, for insurance policy, the premium would amount to only 12-15 thousand; the catch being this amount isn't collected/compounded.
RE:5 Times the Annual Salary?
by on Jan 21, 2008 10:06 AM Permalink
I think you are comparing ULIPs with term insurance policies (12-15 K per annum for a cover of 25 L). You may be right. But you aren't able to save this premium money. In ULIP, everthing gets saved. And the more you save, the better it is. Always keep this in mind.
RE:5 Times the Annual Salary?
by Sujit Talukder on Jan 21, 2008 06:34 PM Permalink
Dear, Insurance is not the place to save money. You get back the invested money and not the amount of insurance premium. In ULIP, charges are very high. So from where the growth to savings will come. It is better to go for Term Plan and ELSS which will give you insurance plus investment at a cost very much lower than ULIPs.
RE:5 Times the Annual Salary?
by suman on Jan 21, 2008 10:27 AM Permalink
MR VIKRAM The min life cover is 5 times,it doesn't mean the customer shd go for only 5 times of his premium,the client got an option of 5 to 40 times of his premium,
RE:top up
by Focus Investments on Jan 21, 2008 10:08 AM Permalink
Dear Anurag, dont go for monthly top ups or sipmutuals fund kindly go back to ur home.
RE:top up
by sanjith on Jan 21, 2008 01:12 PM Permalink
if you are looking for a long term perspective and got a money back up then you can go for sip, otherwise you can go for monthly top ups.
