A must read article by Deepak Shenoy!! Some snippets
Insurance products are incredibly complex, despite their heavy regulation. Financial products are typically of two types —high-risk, where the returns cannot be predicted in any reasonable manner, and low-risk, where the return is either guaranteed or specified (the risk is in whether the seller will go bust). Equity is a high-risk proposition, while fixed deposit and other debt options are the second. Insurance products provide a mix-and-match,
Most people give up before they reach the "real return" calculation — which is why insurers can easily stuff charges into such policies, knowing that if someone is silly enough to invest with a 5% real return, he won't even know that they can take a significant chunk of money as commissions.
Insurance articles are abundantly complex, admitting their abundant regulation. Financial articles are about of two types —high-risk, area the allotment cannot be predicted in any reasonable manner, and low-risk, area the acknowledgment is either affirmed or defined (the accident is in whether the agent will go bust).
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nice posting about investment, great article is published here..
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You are very much right the returns are very low in insurance products, but that doesn’t mean that one should not get insured. If you have dependents who is relying on your income and you love them then one should definitely get insured the trick lies in which insurance you choose there is a insurance called term insurance which is a lot more cheaper than any other insurance type for look here for reference http://goo.gl/An4mk here as you can see it costs Rs. 4,101 for a cover or Rs.50,00,000 for a 25 year old non tobacco user
ReplyDeleteFor investment purpose it is always better to invest in other products according to the risk appetite of the investor such as
Equities and derivatives – High Risk
Mutual funds – Moderate risk
Bank, corporate fixed deposits Govt. bonds - Low risk.
My only argument is to separate the "insurance" from "investment". If you want to get insured, buy term insurance.
ReplyDeleteThanks for the reply Ketan, my intention was not be offencive I just thought that this comment will bring more clarity to your patrons. Will surely come back for more :)
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