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,
