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Old 25th June 2008, 14:19   #1
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Default Best Life Insurance provider

Tried to seach but could not find any dedicated thread for life insurance, so here is the one.
The idea is to share your experience in dealing with various Insurance provider, could be Goverment company as L.I.C or private like aviva, icici, etc.
My story :- One of Aviva's sales representative was after me to sell policy. After he had answered to all my queies, I finally applied for for Aviva Little Master Plan for my son, because I everyone said that this is one of the best plan for kids. I gave a cheque of the premium and all the documents required. At this time Aviva guy told me that I would be getting the policy within 7 working days. The premium amount was debited from my accouny on the 5th working day.
After 9 days I received a letter instead of the full policy from Aviva stating that there were some document missing. I called their customer care and was asked to contact the branch from where the policy was booked. I spoke to them and they confirmed that one document was missing from their end and I was not supposed to do anything. They also assured that they would take care of this. I even called them again and they said that they had taken care of the issue but to my surprise, I received another letter after 3-4 days, stating the same story, still one document was missing.
Now I am really fedup with all this crap and have just talked to the customer service again. I asked them how can Company debit the cheque if the any document was missing in the proposal. They had no answer. I had asked to cancel the proposal and refund the money. Lets see how it goes.
Imagine if this kind of treatment is being given to a potential customer, I wonder how will they treat to someone, when a claim is made or when the policy is matured and time to return the money to the customer.
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Old 25th June 2008, 15:18   #2
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You do get the money back if you apply for cancellation with in 15 days after receiving the policy document. So rest assured

Here is some gyan which I got from my wife. My wife works with a private insurance company as a leagal and compliance Manager. This is her 3rd job private insurance.

The simple facts are

1. Initial loading cost is high in private sector. Sometimes as high as 100% (there is one policy from Kotak which has this)
2. There is a cost component in each subsequent premium.
3. The claims - the rejects are higher in private than LIC

There are many other factors which I dont remember

Everytime, I consult her for a policy from private insurance firms, the analysis shows LIC to be far better.

Its better to stick to LIC.

There are very few genuin policy schemes from Private players which offer good returns.
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Old 25th June 2008, 16:13   #3
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Quote:
Originally Posted by Firebird View Post
You do get the money back if you apply for cancellation with in 15 days after receiving the policy document. So rest assured
Its better to stick to LIC.
Thanks Firebird.
I will go back to LIC. A recent incident has made this decision more firm, my father took a policy for me 15 years ago and and it matured in March 2008. One of the LIC executive came to my home in April 2008 and informed that the policy is matured and please fill the form and get the cheque from the branch and I received the cheque within one day from LIC.
So I now whom to contact for life insurance.
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Old 25th June 2008, 17:47   #4
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Aviva is completely crappy. Had invested with them 3 years back and now that I have managed to learn a few things about insurance am amazed by the charges these guys have. Am closing my account immediately with them.
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Old 26th June 2008, 13:26   #5
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Insurance is to cover unknown emergencies. as an investment tool it pales in front of other savings avenues like PF, NSC, Bank FD, shares.

average long term returns on insurance policy are around 5-7% where as every other investment offer more than this

if one wants policy for one lakh for 20 years

- check what is the premium for money back( children policy also), endowment and pure term.

- deduct the premium amount of pure term policy from money back/endowment policy premium and take pure term policy for one lakh

- save the remaining premium in PF ( safe and secure @8% PA)

-calculate what will be the return for 20 years in PF

-compare PF return with what the insurance companies give you in money back and endowment policy's
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Old 26th June 2008, 14:12   #6
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Some gyan from my side:

1. Insurance is taken for financial security only. So take policy on a person on whom the family is financially dependent. So there is no point in taking a policy on babies, kids.

2. Go for Term policy (for the amount the family is dependent on the person and till the number of years). Endowment, Moneyback or any other type of policies are just flavors of the same thing. All are bad investments.
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Old 26th June 2008, 16:02   #7
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LIC Anmol Jeevan is a very good Term Insurance Plan. A non smoker healthy male around 30 will be paying slightly more than 2000 pm for a 8 lakh cover.

If you are investing for your child, you can choose PPF, Debt Mutual funds or Balanced Mutual funds. Avoid choosing Child Plans which have lock-in period since you will not be able exit in case you are unhappy with the performance of the fund.
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Old 26th June 2008, 16:14   #8
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You know how good is your insurer only when you claim
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Old 26th June 2008, 16:41   #9
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Quote:
Originally Posted by suvi View Post
If you are investing for your child, you can choose PPF, Debt Mutual funds or Balanced Mutual funds. Avoid choosing Child Plans which have lock-in period since you will not be able exit in case you are unhappy with the performance of the fund.
So you meant to say that if I invest the same amount of money in PPF account as what I had planned to invest in child insurance policy, I will get the same or more return after 20 years?

Quote:
Originally Posted by sbasak View Post
You know how good is your insurer only when you claim
Well said.
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Old 26th June 2008, 16:58   #10
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Quote:
Originally Posted by suvi View Post
Avoid choosing Child Plans which have lock-in period since you will not be able exit in case you are unhappy with the performance of the fund.
Lock in period is 3 years for any insurance and I think once you have taken any policy, you will have to wait for the policy maturity time, you can not do anything until the policy is matured.
This is why I like ULIP because of the freedom it gives to withdraw money as per you need, though the same lock in period is still applicable in this.
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Old 26th June 2008, 17:00   #11
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Quote:
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So you meant to say that if I invest the same amount of money in PPF account as what I had planned to invest in child insurance policy, I will get the same or more return after 20 years?
Yes. PPF gives the best post tax return (8%) among "safe" investments. You can use a spreadsheet to compare the returns of LIC specific policy (LIC website has an example for almost all policies) and PPF returns.
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Old 26th June 2008, 17:11   #12
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Quote:
Originally Posted by suvi View Post
LIC Anmol Jeevan is a very good Term Insurance Plan. A non smoker healthy male around 30 will be paying slightly more than 2000 pm for a 8 lakh cover.

I believe its a bit high. I might be wrong. I don't know the tenure of yours.

I have one term cover for me for 25 years, 50 lakh cover, annual premium being hardly 16000, equivalent to Rs 40/- per day, well almost (I can skip the visit to the restuarant)

All other investments are in the market and safe instruments of the govt.

Last edited by lambuhere1 : 26th June 2008 at 17:13. Reason: More info
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Old 26th June 2008, 17:36   #13
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Here is something that happened with me. In 2006, I bought a house with finance from Centurion Bank of Punjab. With the loan I was required to get a Life Insurance Policy from Aviva. The premia for the first two years would be paid from my emi's and the third year onwards, I would have to pay premium. 2008 was the third year and I paid the premium. This was in March. Two weeks back, I received a letter from Aviva, stating that the first premium had not actually been received by them and that they had issued the policy by mistake. So, now they were putting the policy into lapsed mode and to reactivate it I would have to pay the first premium myself.

I was flabbergasted. After a spate of emails and phone calls yielded no result, I paid a visit to my local Centurion Bank office, and got hold of the cheque numbers by which the bank had paid the first two years' premia. I have passed on the information to Aviva Life Insurance, but I still await an update from them. A week has gone by without revertal.

If anyone is thinking of Aviva as their insurer, I say, reconsider your decision. Their record keeping is obviously suspect. After 15-20 years when your policy matures, you do not want them to come back to you and say, Sorry sir, but we did not receive your premium in year 4, so your policy has lapsed. We can not pay.

With all this regulation, if this can happen, I prefer the old faithful LIC to these new kids on the block.
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Old 26th June 2008, 18:30   #14
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Quote:
Originally Posted by prabuddhadg View Post
If anyone is thinking of Aviva as their insurer, I say, reconsider your decision. Their record keeping is obviously suspect. After 15-20 years when your policy matures, you do not want them to come back to you and say, Sorry sir, but we did not receive your premium in year 4, so your policy has lapsed. We can not pay.

With all this regulation, if this can happen, I prefer the old faithful LIC to these new kids on the block.
Thanks Prabhu,
These kind of incidents are making my decision much more strong to go back to LIC or else opt for some other alternative as suggested by others here.
Anyone has any feedback of any other insurance provider, negative or positive?
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Old 26th June 2008, 19:13   #15
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Quote:
Originally Posted by anonymous View Post
So you meant to say that if I invest the same amount of money in PPF account as what I had planned to invest in child insurance policy, I will get the same or more return after 20 years?
Yes you will get better returns with PPF. Reason is, if you invest 20k in PPF, you get returns on 20k.

With insurance policies, you get returns on (20k - insurance charges).
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