In the past couple of years, there’s been a lot of noise about the need for life insurance – everyone’s telling you to get it – from your friendly agent to your neighbourhood bank to all those screaming television commercials. They all remind you of good and bad events in life, make you dream about your children’s educational needs, their marriages, your old age or illnesses. They warn you of impending doom, of the need to buy life insurance Right Now!

It is true that an unforeseen accident can leave a family not only emotionally bereaved but also financially devastated. As an earning member with dependents, it is your responsibility to protect your family in the event something happens to you and you are not able to provide for them anymore. But, do you know all the facts about Life Insurance? Do you know how much cover you need and how to calculate it? Do you know the term you need it for? If you can’t figure out the answers to these questions yourself, you’ll be putty in the hands of some unscrupulous agent. » Read more..

THERE is a lot of hue and cry from life insurance companies that unit- linked insurance plans (Ulips) are set to lose their charm. I don’t think so, as Ulips will still continue to pay lucrative commissions for the first five years. However, competition seems to be forcing insurance companies to launch traditional life insurance products, as there is no cap on the cost of these products and it will allow life insurance companies to pay very high commissions. Yet again, the life insurance industry seems to be missing the point and the focus will be on products where there will be a higher commission payout.

So what are traditional plans? There are six types of traditional plans: endowment plan, money-back plan, whole-life plan, pension plan, children’s plan and term plan. Except for the term plan, the others are available in Ulips as well. Traditional plans are insurance policies where the policyholder has no control or choice over where the investments will be made, whereas in a Ulip a policyholder has around five to six choices based on different combinations of equity, debt and cash. » Read more..

Publication: DNA,Mumbai;   Date: August 4, 2007;    Section: Personal Finance;   Page: 6

LICs Market Plus is a losing proposition

Life Insurance Corporation of India (LIC) launched unit linked insurance plans (Ulips) much later than its private sector counterparts. And though these products have been in vogue for around five years, the insurance behemoth has only two Ulips as on date, one of which is Market Plus, a deferred pension Ulip.
The Webster dictionary defines pension as “a fixed sum paid regularly, especially to a person retired from service.”
In the Indian context, pension plans can be divided into two categories: immediate annuities and deferred annuities. An immediate annuity is an actual pension plan that keeps the sanctity of the word pension intact. On putting money in an immediate annuity, the insurance firm pays the policyholder a certain sum of money at yearly or other regular intervals (monthly, quarterly, semi-annually or » Read more..