I remember a friend saying when he got a tip to buy a share the first thing he would ask the person is – will I be able to sell 500,000 shares without impacting the price of the share?

Accumulation happens over a long time, however exit could happen suddenly and swiftly. Also the company may play dirty by reducing volumes – thus you may be stuck with a super illiquid share!

Similarly if a life insurance agent comes to you to sell life insurance or medical insurance ask him for the process of withdrawal / surrender of a plan. There is a good chance that the sales guy will not know the process.

Most companies will say ‘Compulsorily it will be credited to a bank account’..so you give the bank account number. Then they will say ‘Sorry sir you have to give a cancelled cheque’ …so you give a cancelled cheque.

They will say..sorry the IFSC code is not there, so please get the form authenticated by the bank…by this time you are at your wits end.

Some of them will say please give a receipt…(BEFORE THEY HAVE MADE THE PAYMENT). They will say ‘this is the procedure’ – does not matter even if you know the Chairman or his grandfather. Process, Sir process is process.

Sir as your wife is the beneficiary she has to sign in 3 places…and the amount will be sent to her account. We now need her cheque, attestation, OMG once again!

This is straight from Ripley’s Believe it or Not : One life insurance company has 22 branches in Mumbai to sell life insurance. For surrendering the plan the CLIENT has to go in PERSON (if it is a joint policy both have to go) to one branch, close to Ahmedabad (technically they still call it Mumbai, no clue how) and it is the ONLY place which will accept the application. God bless.

So ask your agent – ‘will you help me while it is being redeemed’ – or in a worst case scenario if I die during the tenor of this plan, will you help my nominee?

In case you do not pay, I will come as a ghost and collect the money from your Managing Director. I promise it will be fun for me. Not sure about your MD.

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  1. This country is so full of scams. People will literally make hundreds of visit if they have to take money from us. But that golden moment comes for us to get OUR money back, we have to do the same thing – make hundred visits to their offices. That is one reason I would like to keep everything online and linked to bank accounts. But India is still far away from adapting to the technologies. I hear, now you can hold your insurance policy online. But what’s the use, you cannot claim/redeem online.

  2. Ending up as ghost to haunt a company MD for not fulfilling financial commitments could make an interesting film story. 🙂

  3. This is terrible. It must be happening. So I have no insurance at all.

    This is also a reflection of the poor level of customer rights, that exist in our country. Everyone feels that they can fleece the retail end.

    It is the frustration that the common man feels, that is reflected in the support for Anna Hazare.

  4. i dont think redeeming online makes sense for term insurance atleast until death certificates become online and digital signatures become commonplace.

    uh oh@support anna. he is hardly fighting for consumer rights.he just wants his version of the benevolent dictator. he is not talking about property rights or economic freedom at all. i mean,the whole 2g scam is premised on the nonsense that spectrum “is owned” by the govt. such hobbesian views are so common these days,people dont even stop to think

  5. Ravinder Makhaik

    @ Pravin

    You make a valid point.

    Spectrum, a gift from nature that science discovered late and turned into an effective medium for communication, has been monopolized by the government (being the sovereign power it is) as a scare resource.

    I confess, most of us will not even stop by to ponder about it.

  6. Subra,

    On the topic of surrendering a policy – Is there formula to arrive best time to surrender a bad policy? or is Any time a good time to stop such policies and move on licking the wounds?

  7. I am also having bad experience in surrendering the policy. I had SBI endowment policy called “Sudarshan” plan. I wanted to surrender it after 5 years. I contacted customer care via. email and they sent me link to download the form online. I had to go out of india for company work for 6 months so I kept 3 copies of the same form with my friend. I signed it and properly filled them.
    My friend personally went to submit them at SBI center in Mumbai. After seeing form the person there said that the form which is available online is not correct. He gave different form to my friend.
    Now, I am out of India so can’t do much.
    I contacted customer care thr. email and they didnt reply for 15 days.
    after 15 days they just replied with the same link.

    I am very frustrated with this.

  8. Selling endowment

    At this present time in addition to insurance for protection needs, as well as the insurance is designed to help customers such as family financial plan to fund education, retirement, or other needs in the future

  9. its actually a querry !
    i bought kotak life insuarance 4yrs back, the lock-in period of 3yrs is over. despite the name safe growth plan, it was neither safe nor there was any growth.
    is surrendering the best option or am i stuck for next 21 yrs?

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