An Unfriendly Benefit Scheme of Insurance

I have recently received a benefit illustration from Max Insurance as attached on their 'Assured Wealth Plan' (a non linked, non participating Life Insurance Plan the meaning of which is not known to me). You will observe from the example that even if a policy holder pays full premium of one lakh per annum for five years, the guaranteed surrender value on sixth year is 2,70,003 and a special surrender value is 5,02,637. Similar values with very paltry or no gain is given until the holder completes the mandatory term of ten years.
My question is if the policy holder surrenders his policy before the mandatory period, when he needs the money for some circumstance hitherto unforeseen, he is penalized for no reason as the insurance company is no longer assuring any life coverage nor is taking any other risk coverage for the policy holder. The insurer is not even paying the savings bank interest on the premium paid. Is it not profiteering? How IRDAI allows such schemes to be floated by Insurance Companies? Many a times the policy holder is brainwashed by an agent into putting his neck into one such scheme without studying these nit ti-gritties. Can local circle take up with IRDAI to stop Insurers from selling such schemes and reversing the existing policies of this nature? more  

View all 28 comments Below 28 comments
SIR,

THERE ARE COSTS INVOLVED IN SELLING AND MAINTAINING THE POLICY FOR THE PERIOD POLICY OFFERED VALID COVER. TO COVER THE COST OF SAME, THERE IS NO/VERY LITTLE SURRENDER VALUE DURING THE INITIAL YEARS OF THE POLICY more  
Sorry the inputs given are incomplete. It will be unfair for me to comment on it without having the policy details. However, the least I can advise is make a memorial to IRDA, who is bound to look into and answer.
S.R.Krishna Murthy. more  
Premium amount of Life Insurance has two different segments. One is for Life Risk and other is investment purpose. Hence, a premature withdrawal will not be in line with regular investment. more  
I agree with Shishir. Investment and insurance plans are two different instruments. Prior for raising assets and later is for creating Asset in the unforseen eventuality thus taking risk also into account. So if one needs returns go for investment and if one needs risk taken care go for insurance plan, linked to market or not is your choice in such insurance plan. I feel IRDA takes into account before allowing launch. more  
Greed of dream leads one to enter into dream insurance plan of all private insurance companies. It is always to opt general risk insurance policy on long duration span with monthly pension return. This scheme will benefit every one. Incase one wish to have investment plans, better option is SIP, which is risk free and return is good. more  
Post a Comment

Related Posts

    • Why is MDR a percentage of transaction value

      Why cant MDR charge be capped at say INR 20. So make it 2% percent of transaction say till txn value 1000 and above that it should be capped at INR 20. That way if I buy 50,000 washing machine on ...

      By Ruchika Mistry
      /
    • Restaurant Service Charge: Recent Experiences

      With this post we would like to seek your latest experiences in regards to restaurant service charge in the last few months.As a reference, Please find attached the Restaurant Service Charge aware...

      By Dept. of Consumer Affairs (Government of India)
      /
    • Daikin refusing to replace damaged AC

      TL;DR I purchased a Daikin AC from amazon and I found it defective after a month. I contacted Daikin regarding this and they said there was no damage at first. Finally they offered me repair but I ...

      By Tarun Kumar Reddy
      /
    • Solutions to improve Food Ordering eCommerce apps/sites

      Below are some of the key issues raised by you in regards to food related eCommerce sites and apps.Kindly review the same and help identify solutions that must be implemented to make these apps mor...

      By Dept. of Consumer Affairs (Government of India)
      /
    • PVR and others convenience fee loot

      On one hand our respected PM is propogaing digital india on other hand these brands like PVR, book my show and many many others are charging convenience fee for doing transaction online. Some like...

      By Sudesh Rai
      /
    • False information to get subscription from customer

      I received a call from Videocon d2h call centre regarding channel No 131 which is Comedy channel. The call centre person told that they are giving the channel @ Rs 1 for 7 days and if you like it, ...

      By Satya Pratap Detha
      /
    • Misguided by Flipkart

      I ordered a product from flipkart.com and it was delivered on time when i opened it i realised that i had ordered pack of 6 and got only 5 pieces and these 5 pieces were just tied with the rubber b...

      By Vaibhav Kamath
      /
    • Service deficiency by the telecom operators & forcing customers to pay full charges

      I had mobile connection with Airtel, faced immense problem regarding my previous office telephone bills and internet connections. Repeated request through customer service number, their nodal offic...

      By Anuradha Bhatta
      /
    • Charging of convenience fee must stop - Consumer Minsitry act pls

      Why do services like booking tickets (flights, movies, whatever have you) apply a convenience charge for online transactions? Isn’t the customer making it more convenient for them by not requ...

      By Vishal Khanna
      /
    • Kent RO fraud

      I have purchased Kent RO 5 months back. Continue giving problem. Today stopped working. No one is listening. Very bad..

      By Sumit Mittal
      /
    • Digital Payments MDR announcement

      Read attached friends. Govt has addressed circle ask about mdr charges being absorbed by them in budget. However they are only doing it for businesses above 50 crore revenues. How about small trade...

      By Amit Mishra
      /
Share To
Enter your email & mobile number and we will send you the instructions

Note - The email can sometime gets delivered to the spam folder, so the instruction will be send to your mobile as well

Please select a Circle that you want people to invite to.
Invite to
(Maximum 500 email ids allowed.)