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  

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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  
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