Life Insurance Trust: Fill & Download for Free

Here is a YouTube video on why insurance is a bad investment:I think it is a big mistake to mix insurance and investment.If you are a layman who doesn’t understand anything about life insurance, then let me first quickly explain the type of life insurance.Broadly, life insurance is divided into 3 categories:Term Plan: Pure form of life insurance with very low annual premium. For example, If a person takes a term plan of Rs 50 lakh for 25 years and he dies during the 25 years then his family would get Rs 50 lakh. If he survives, he won’t get anything. So this plan does not mix insurance and investment.Endowment Plan: It mixes insurance and investment. For example, If a person takes a term plan of Rs 50 lakh for 25 years and he dies during the 25 years then his family would get Rs 50 lakh. If he survives, he would still get Rs 50 lakh on maturity. However, the annual premium would be almost 10–20 times of term plan.ULIP Plan: Unit Linked Insurance Plan where the money is invested in the mutual fund. This is similar to the endowment plan but the returns are not fixed.I have 5 reasons for not investing in endowment plans.#1 Pathetic returnsDo you know how much annual return do you get from the insurance cum investment?The problem is people don’t know how to calculate the return and the agents also never mention it.The reason is simple- The returns are pathetic. They are even poor than FD returns.#2 Lack of transparencyEndowment plans never disclose what they are doing with the money.Where they are investing it? How much goes into mortality? And that’s where I have a problem.#3 High Annual PremiumIdeally, a person should take insurance of Rs 1–2 Crore and if you take an endowment plan then the annual premium will rip you apart.People end up taking endowment plans for Rs 10 lakh or Rs 20 lakh but that’s not enough. If something happens tomorrow, how will the family survive with Rs 10–20 lakh? And if they take 1–2 crore insurance from the endowment plan then the annual premium would be probably higher than their annual income.#4 High commission of agent and the companyEndowment plans to eat a lot of profit from their customers in the form of commission.#5 High Surrender Charges and poor liquidityIf a person takes an endowment plan, he can’t exit for the next 5–10 years. In case, the person exit early, he would either lose all the money or would not even get the principal amount.This makes endowment plan a highly illiquid investment.ConclusionInsurance as an investment was introduced at a time when there were limited investment options. People were less educated and had little knowledge. Moreover, there was a trust issue due to various frauds. Hence, people opted for LIC investment due to their trust factor. However, the time has changed. Now, there are much better investment options with high liquidity, low commission, high transparency, and better returns. A person should never mix insurance and investment. Always take a term plan of Rs 1–2 Crore for life insurance and invest the money in mutual funds.

The Bible has said ZERO about “putting chips in people.” Nothing. Nada. Zip. It would have been a miracle if it did, because obviously there were no such things as microchips when it was written.If your mother doesn’t want to get the vaccine, try this: call every life insurance agent in town and tell them she needs a life insurance plan. Set her up with appointments with them. And when she asks “why?” tell her that if she’s going to be stupid about this, at least you’re going to have something to fall back on when she dies.Edit: And while you’re at it, get her measured for a coffin and bring around brochures from local cemeteries, probing her on where she wants to be buried and what kind of funeral she wants.

Anyone who has been investing for a while will vouch for the fact that determining a term insurance best depends largely on your goals or needs. generally, while buying term insurance, these are the features to look for:Adequate cover amountManaging inflation factorPolicy durationReasonable claim and settlement ratioAffordable premiumsIf you are on the verge of buying a term plan, do visit SBI Life term insurance. They quite a few varieties of plans and have been performing pretty well in the market for a while.