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Old 20th October 2010, 12:00   #211
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Originally Posted by carboy View Post
What i am arguing against here is a creating of a thumb rule (100 times your monthly income) which works.

......


For each person/each family, all these and possibly more parameters are different. Which is why each person/family's insurance needs would be different.
Hey, once you take into consideration all these, it is no longer a "thumb rule"; it is a complicated "formula".
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Old 20th October 2010, 12:32   #212
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Hey, once you take into consideration all these, it is no longer a "thumb rule"; it is a complicated "formula".
Yes, that's exactly my point - it's not possible to have a thumb rule for life insurance amount.
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Old 20th October 2010, 14:36   #213
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amitk, for the 20/30% you spend from your pocket at the private hospitals, you will get far better treatment at the Govt. hospitals. Why take Medical insurance at all?

<grin>
I disagree that you necessarily get better treatment at private hospitals for specialized cases institutes such as AIIMs in Delhi , PGI Chandigarh and for cardiology Jayadeva Institute Bangalore has no parallel.

It is not about expense , Expenses are roughly same if you are middle class non -government employee here only BPL people are subsidized. So for example cost of medicated stent implant at Jayadeva is roughly 1.6 - 2 Lakhs so not too much of difference from other private hospitals but the difference lies in the team which does the job.

Jayadeva Institute of Cardiology is no ordinary hospital, In private big hospitals the whole cardiac care unit runs on shoulders of at max some 3 -4 superspecialists ( DM Cardiology) + few MDs

In jayadeva there are 35+ seats for DM course and more then 40 professors. The whole hospital is 540 beds just for cardiology.

One of my uncle got angioplasty done at escorts in Delhi there the specialist just puts the stunt and catherator was pulled out by someone else ( para-medical staff) and he pulled it out too fast without a drip causing neurological shock due to sudden extreme pain. Ideally this job should have been done by specialist himself but as they are short on staff this kind of care is not taken.

Yesterday my mom went through angiography and the team who did the procedure had 2 Professors and 3 DM students.

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Old 28th November 2010, 16:20   #214
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I am really confused now..

Guys, I am thinking of taking a 40L cover under the Jeevan Anand Scheme of LIC, the premiums are hefty I agree.
The reason I am going for an endowment one is because I am a zero in stock markets and MFs.

Please let me know if this scheme is good. Cos I am realising all my investments till date are only in the mode of FDs in banks and in mode of NSC schemes, dont think I will go anywhere by the time I am 56 odd..
Thats why decided on going for Jeevan Anand.

Need experts Advice please...

Please help me

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Old 28th November 2010, 21:05   #215
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Guys, I am thinking of taking a 40L cover under the Jeevan Anand Scheme of LIC, the premiums are hefty I agree.
The reason I am going for an endowment one is because I am a zero in stock markets and MFs.
Why the Jeevan Anand scheme?

Do you realise that returns, aka "bonus" per year is 5% for LIC and still lesser in other Life insurance companies?

Check this link:-

https://www.licindia.in/bonus_info.htm

Returns would be better when "terminal bonus" when the policy matures (and not for premature withdrawal) This is only when policy maturity exceeds 20 years. Check those charts from the above link.

IMO, if you are looking at savings and have no alternative to endowment policy, simple endowment policy (table 14 / 48). No jeevan bla bla. Only one or two schemes provide better bonus than the pure endowment plan; but the premium for such plans is very high.

For example, for a 25 year old, the premium for table 14, "Endowment Assurance policy" for a 25 year premium payment term is Rs. 1,48,170.00 for annual payment.

The bonus for this policy for this term is Rs. 48 per thousand for the year 2009. Plus final additional bonus is Rs. 750/- per thousand.

In other words, for a policy value of Rs. 1,000/-, you get (1000 + (48 x 25) + 750) = 2950/- at maturity. For 40L insured value, you get Rs. 1,18,00,000/- (rs. 1.18 crore) at maturity, for which you would have paid Rs. 37.04,250/- as premium.

For jeevan anand, plan 149, the premium for same insured value for a 25 year old person is Rs. 1,58,474.00,

The bonus, however, is Rs. 45 per thousand. There is no Final additional bonus.

So, you get (1,000 + (45 x 25) + 0) = 2125 per thousand insured value, subject to a minimum of the total premium amount you paid. So, you get Rs. 85,00,000 on maturity, for which you have paid Rs. 39,61,850 premium.

Please note that the bonus rates would vary in theory, in practise, have remained constant over past 4-5 years. And past 4-5 years have been best in terms of returns in the general market. So, be prepared for still lower returns. If you are aged more, you will pay still higher premium, and if the policy term is lesser, still higher premium, and lesser final bonus.

Now, choose your poison.

I feel that with PPF / NSCs, you will get still better returns; have not worked out the rates though.

Edit - 1, Ooops!!! missed on your age. I guess you are best off investing in NSC / PPF.

2, In considering the returns, i have not considered the tax implications. Investments up to 1 lakh in insurance / PPF / NSCs are exempt under 80C of Income Tax Act, so your actual rate of returns would be slightly higher for investments in these schemes, because for every 1K spent in premium / PPF/ NSC, you save 100 / 200 / 300 on tax, depending on tax bracket you are in.

3. Considering your age, and if you have adequate FD / other liquid assets and non-liquid assets (like land / house), and also, if you can afford to not touch the money for 3-5 years,I suggest investing in some equity oriented Mutual fund scheme (NOT tax saver schemes - they provide slightly lower rates of returns). But the markets have gone up 20 - 30 % in past half year, so market fluctuations will be very high.

Last edited by BaCkSeAtDrIVeR : 28th November 2010 at 21:13.
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Old 29th November 2010, 07:55   #216
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Quote:
Originally Posted by xingamazon View Post
I am really confused now..
Guys, I am thinking of taking a 40L cover under the Jeevan Anand Scheme of LIC, the premiums are hefty I agree.
The reason I am going for an endowment one is because I am a zero in stock markets and MFs.
The right decision would be to go for a term life cover where the premium would be around 10-15K and invest the rest of the planned premium in a 5 star rated MF in SIP mode.
Alternatively you could invest the remainder amount in PPF too.

Jeevan Anand - a bad choice. I had one and surrendered it. Two reasons - high premium, poor return on investment.
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Old 29th November 2010, 15:09   #217
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Originally Posted by BaCkSeAtDrIVeR View Post
Why the Jeevan Anand scheme?

Please note that the bonus rates would vary in theory, in practise, have remained constant over past 4-5 years. And past 4-5 years have been best in terms of returns in the general market. So, be prepared for still lower returns. If you are aged more, you will pay still higher premium, and if the policy term is lesser, still higher premium, and lesser final bonus.
.......
.......
.......
3. Considering your age, and if you have adequate FD / other liquid assets and non-liquid assets (like land / house), and also, if you can afford to not touch the money for 3-5 years,I suggest investing in some equity oriented Mutual fund scheme (NOT tax saver schemes - they provide slightly lower rates of returns). But the markets have gone up 20 - 30 % in past half year, so market fluctuations will be very high.
Quote:
Originally Posted by ghodlur View Post
The right decision would be to go for a term life cover where the premium would be around 10-15K and invest the rest of the planned premium in a 5 star rated MF in SIP mode.
Alternatively you could invest the remainder amount in PPF too.

Jeevan Anand - a bad choice. I had one and surrendered it. Two reasons - high premium, poor return on investment.

Thanks a lot Backseatdriver and gholur for your advise.

Let me tell you where my problem actually starts. when you say invest in SIP mutual funds, I am actually not the kind of person who keeps a good watch on the markets, dont if at all I make a choice dont think I would be making a good decision on that one.

I know there are few insurers who would provide bettters returns but the reason I have shortlisted LIC is becuase they are a bit hassle free I guess.

Moreover, not sure whom should I trust among the private insurance players. and the Mutual funds are only scaring me, with such least exposure to the markets I thought it would be a safe bet taking a 40L coverage under Jeevan Anand with 1L odd premium p.a. I am now 28yrs old.

The lazy bone that I am, not sure if I would be able to approach some MF broker and get a right investment made. Thought even if the return are less its better safe than do nothing.
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Old 29th November 2010, 15:33   #218
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@Xingamazon,

The thumb rule - Never mix Insurance with investment, keep both seperate. Going by your age in your post, the premium for a term life policy would be low. So your first choice should be a Term life policy.

Next since you are in late twenties, the next obvious choice should be a good pension plan. The early you start saving for your retirement, the better would be the returns.

Third choice - A good medical Insurance plan covering maybe parents+Spouse+Children.

Fourth Choice - Investments - Mutual Funds if you can take risk, else choose PPF/NSC/Postal schemes. If you choose a good MF you dont need to keep a track on daily basis but maybe once in 6 months or so. If you still feel lazy, catch hold of a good Investment advisor for some door step service.

Believe me if you dont start thinking on those line ASAP, you will feel the brunt in the twilight years.
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Old 29th November 2010, 15:55   #219
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Originally Posted by ghodlur View Post
@Xingamazon,

The thumb rule - Never mix Insurance with investment, keep both seperate. Going by your age in your post, the premium for a term life policy would be low. So your first choice should be a Term life policy.

Next since you are in late twenties, the next obvious choice should be a good pension plan. The early you start saving for your retirement, the better would be the returns.

Third choice - A good medical Insurance plan covering maybe parents+Spouse+Children.

Fourth Choice - Investments - Mutual Funds if you can take risk, else choose PPF/NSC/Postal schemes. If you choose a good MF you dont need to keep a track on daily basis but maybe once in 6 months or so. If you still feel lazy, catch hold of a good Investment advisor for some door step service.

Believe me if you dont start thinking on those line ASAP, you will feel the brunt in the twilight years.
Hi Hodlur,


Have kind of finalized on term assurance based on your comments. Will discuss with my friends on this also
Thanks a lot for the advise, have few doubts can you clarify.

1. For the term assrance plans, my agent says the max assured amt is only 25L is that right. And the coverage is only till I am 65 yrs of age is that right?

2. When you say pension plans are there plans which are seperate from the Insurance plans? I mean some good trustable ones.
Can you let me know who are the good players in this field, does LIC also provide pension plans?

3. Regarding Medical ins, my family and I are covered under the Med ins plan of my company is that good enough??

4. You mentioned "If you choose a good MF" can you let me know the how you would define good MFs, is there a thread in which this is being discussed, or any such good reading in this regard?


Appreciate the help you are doing. . Will IM you in case if I have more doubts.
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Old 29th November 2010, 15:58   #220
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I am now 28yrs old.
If you die tomorrow, is there someone who is dependent a lot on your income & whose lifestyle will change radically because your income has stopped?
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Old 29th November 2010, 16:11   #221
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If you die tomorrow, is there someone who is dependent a lot on your income & whose lifestyle will change radically because your income has stopped?
The answer to your question is Yes, thats why I was concerned 25L limit would not quite be enough nowadays.
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Old 29th November 2010, 16:23   #222
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Originally Posted by xingamazon View Post
Hi Hodlur,


Have kind of finalized on term assurance based on your comments. Will discuss with my friends on this also
Thanks a lot for the advise, have few doubts can you clarify.

1. For the term assrance plans, my agent says the max assured amt is only 25L is that right. And the coverage is only till I am 65 yrs of age is that right?

2. When you say pension plans are there plans which are seperate from the Insurance plans? I mean some good trustable ones.
Can you let me know who are the good players in this field, does LIC also provide pension plans?

3. Regarding Medical ins, my family and I are covered under the Med ins plan of my company is that good enough??

4. You mentioned "If you choose a good MF" can you let me know the how you would define good MFs, is there a thread in which this is being discussed, or any such good reading in this regard?


Appreciate the help you are doing. . Will IM you in case if I have more doubts.
For term insurance don't go through agents. Try online. Aegon religare, ICICI and max newyork offer it online. Online policy is almost cheaper by 50% . You can insure for amount higher than 25 lakhs

Rest of the amount ( what you have intended to put in Jeevan Anand - Term insurance premium) save in PPF. You can open PPF account in any Post office or SBI. I suggest SBI. But if you want service at door step go for Post office because agent will do it for you. You can invest 70K per year in PPF. You can open PPF accounts in your spouse name, kids name also. In each you can save 70K per year. This is if you are totally risk averse. Here you need to invest once in a year or you can do it monthly also depending upon your convenience

If you company is offering medical insurance do not take any other medical insurance. Because you can not claim from both insurers.

Do not go for any pension plans. Just keep extending the PPF by 5 years after initial 15 years. At the end the corpus you generate in PPF will be much higher than any pension fund can give for the same amount invested yearly. Further it is safest
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Old 29th November 2010, 16:30   #223
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Rest of the amount ( what you have intended to put in Jeevan Anand - Term insurance premium) save in PPF. You can open PPF account in any Post office or SBI. I suggest SBI. But if you want service at door step go for Post office because agent will do it for you. You can invest 70K per year in PPF. You can open PPF accounts in your spouse name, kids name also. In each you can save 70K per year. This is if you are totally risk averse. Here you need to invest once in a year or you can do it monthly also depending upon your convenience
The biggest advantage of PPF is not it's safety - though it's super safe. Most Bank FD's, Post Office Schemes are also as safe as PPF & offer similiar returns (or more). However PPF has one rare feature. The Interest in PPF is tax-free - I don't think this is true for any other Fixed Income product.
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Old 29th November 2010, 16:45   #224
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Does the PPF have lock in period, how do you make sure the amount you put in the PPF is not touched, for example, when you are thinking of an upgrade for the car, how do you make sure you are not tempted to touch this funds at all.
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Old 29th November 2010, 19:56   #225
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Does the PPF have lock in period, how do you make sure the amount you put in the PPF is not touched, for example, when you are thinking of an upgrade for the car, how do you make sure you are not tempted to touch this funds at all.
As of for PPF in SBI, it has a lock in period of 15 years! After that you can still extend for 5 years.
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