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Bangalore Business Network [This Network is not currently active and cannot accept new posts] | | Topics
Insurance Rip off !!Views: 135
Oct 09, 2013 6:32 am re: re: re: Insurance Rip off !!

R Ramkumar
I think it is important to understand how some of these policies work before diving in and investing.
Firstly, the guy who is trying to sell you the policy will always try and paint an extremely bright picture. Though the IRDA has tried to regulate this a bit by saying that they need to provide scenarios of 6% and max 10% returns per year (I think those are the guidelines), the agent will always tell you this is the minimum and actual will be higher.
All of us need to understand that the money is invested in products linked to the share market / debt markets as per the ratios defined in the policy. When the share markets are down, these will reflect in the value of the money we have invested in these policies to the extent of the ratio defined.
It is not only HDFC - all of the other insurance companies that provide similar products come with the same set of issues.
What can we do about this? If the agent has grossly misrepresented the product, we can take this up with the IRDA on grounds of misrepresentation (which is strictly prohibited). If the agent has assured you of more than 10% returns annually, it will also qualify for an IRDA complaint.
If the agent has advised at the time of selling the policy that the returns will be in line with the market conditions, then there is pretty little chance that any appellate authority will help.
This is purely my take on the situation - I am not an expert on this- I am purely just another "investor". I had to terminate 2 policies recently (in the last 6 months) - one of HDFC and one of Birla Sun Life due to a financial requirement. I lost some money on the Birla Sunlife (about 10% of my investment) but actually made marginal money on the HDFC policy (I guess I was lucky with the market situation being favourable at the time of my termination of the policy).

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