Are you surprised at this title? Has the Insurance industry not been telling you that Indians are under insured?
I met one person last week – a lady who had taken VRS. She was not planning to take up a job again and it was the end of her working life. She was under 40 years of age and her life insurance was in …well a mess.
She knew her policies in terms of premia per month, per quarter, or per annum. No clue why she had any of those policies. She was earning about Rs. 30L and thus had tremendous premium paying potential. She has a husband earning about Rs. 1.4 crores. Her parents or siblings do not need her money for sure.
So technically she had no dependents. She was paying a premium of Rs. 5L per annum with a plethora of policies. Her sum assured was a princely Rs. 50L. Even had a moneyback policy meant to fund her son’s education when he turned 19! He was not about 11 years of age.
Met another person – another lady – who was so terribly over insured with TERM INSURANCE itself, that to me it looked burdensome – and far more importantly unnecessary.
If you are a woman earning Rs. 15L and aged 40, how much term insurance do you need? Forget all thumb rules, about Rs. 1 crore is enough. And till what age should one have TERM INSURANCE? till your age at which you will retire. We are all fooling ourselves believing 60 years to be the retirement age. In this country of youngsters, people will be lucky to keep their jobs beyond the age of 55 years.
So she needs a Rs. 1 crore TERM INSURANCE, from the CHEAPEST PROVIDER, BOUGHT ONLINE.
Well that is what she NEEDS. Only problem is that people buy what the RM sells (term insurance) with extra loading (hey bank has to make money) for an amount which the RM proposes. So it becomes a Rs. 2.5 crore insurance, till age 75 (maam it is available till 75, not like other insurance companies).
SO WHAT you can ask, Right? Well she is over paying for an over insurance for an excessive period of time. And worse, at a higher rate. Tch tch….so what?
Hmmm…i wish I could sell a ‘Wild Animal killing you’ insurance. Value Rs. 1 crore. Premium Rs. 750.
Brilliant deal no? Valid for 1 year….want it?
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