Jul 14, 2006 10:41 PM
6977 Views
(Updated Oct 23, 2006 09:24 AM)
Our old policies were not fetching good return and notransparencies were there in those policies. I hope ULIP’s are more flexiblethan our old plans.
Following are the flexibilities:
to choose premium of our choice
We can increase premium, but in old plans wehave to take a new plan which means again administrative charges for a new planand a new liability to pay premiums.
We can put more money in same plan, therebyreducing administrative cost, and botheration of monitoring different plans. Itcan be stated by example Jeevan shree a plan by LIC was a guaranteed plan, avery beneficial plan in term of returns. But can we put more money into it? No.
We can stop our premium. This helps in reducingour liabilities. Suppose a Mr. X has to under go his wife’s operation, in thesame year he has to pay certain amount of premium so what to choose because ifpremiums on the due policies are not paid either they become paid-up or lapsed.In ULIP’s he can take a premium holiday i.e. no premium that year.
Partial withdrawals are possible. Same case asabove in Mr. X’s case money needed for the operation will come from his ULIP’s policyas interest free, but in traditional plans we take load on our own policy therebypaying interest on our own money.
Choice to multiply my money as per our wish. Weall know that debt instruments are not fetching many returns. For the last 10years return on govt. bonds is coming down every year. But on the same timeindustry is growing. Our traditional plans grow our money in debt instrumentsthereby giving us low return now for a person who wants a good return on hisinvestment and ready to take risk on his money can fetch better returns.
About charges ULIP’s are still better thantraditional plans atleast they inform us about how much is deducted from ourpremiums. In old plans we were unknown about the same.
At least we know the value of our investment onday to day basis. So I am in touch with my investments.
We must not challenge a brain who had invented this plan hemust have thought about if’s and but’s , rather we should think aboutdeveloping agents in a proper fashion who can explain ULIP’s in a bettermanner. Every plan has two parts features and deductions. We should put ourpriority before that agent first what we want. We need better agent, all plansare good until taken a proper care for it.
Visit https://personalfn.com/detailpf.asp?date=08/23/2006&story=2 for confirmation of the above comments by me.
