I had promised a few days back…that I will comment on the SBI ad for life insurance. Let me take the first 3 points today.

Let us see:

a. did we not know it before we saw the ad?

b. Does it say anything new?

c. Does it say how to react?

Well read them first…….

1. Analyse and ensure that the plan meets your insurance needs and long term financial goals

2. Is it a Unit Linked or Traditional?

3. Understand risk factors, terms and conditions, of the plan and read the sales brochure carefully.

Questions to SBI:

a. I do not know what are my long term insurance needs. I earn Rs. 93 lakhs, have an earning wife and my daughter is about to be married. When I met my relationship manager he said ‘Sir you need a life insurance cover of Rs. 1 crore – and please take an endowment plan’.  Subra of www.subramoney.com says ‘Mani you need no life insurance’. So what do I do Sir?

b. Subramoney says Ask “is it term or endowment” – and says choose if the FORMER – only if it is cheap and you are sure that the service is good.

He also says ignore unit linked or classic – endowment product like the plague. What should i do? Listen to whom? And what if he says Unit linked or traditional?

c. Complete bouncer sir. Not sure why we do not get a nice detailed prospectus or Offer Document like the mutual funds give us. If i buy a ULIP i have no clue of the fund manager, past performance, peer comparison (why is there no comparative website i have no clue), I do not get to see the fund manager on tv, …….after 7 years of paying Rs. 100,000 p.a. as a premium my policy is worth Rs. 714,000. This is really pathetic. Even now I do not know the risk factors… 🙂