Most Important Questions you should ask a ULIP agent

Most important questions you should ask a ULIP agent

When an agent comes to sell you a ULIP product, you should ask following are the questions you should ask him . Before doing any thing he should tell you What is a ULIP . Following are 6 Important questions you should ask an ULIP agent before buying a policy from him .


1. What are the returns offered by this ULIP ?

As per the rules of IRDA , an agent should only give illustration assuming 6% and 10% returns, However If he says that in long term its safe to expect more than 10% , It would be fine . But if he starts claiming that It "will" return 18% , 20% or million % returns , be cautious , He is not the right agent .

2. What are the Charges in this ULIP ?

He should give you detailed Information on all the charges of ULIP ,the main one calledPremium Allocation Charges . If he tries to hide any Charge from you , I am sure its not because of his dishonesty and no other reason . Ask him the company brochure mentioning the exact charges .


3. How does it suit my Risk Profile and fit in my requirement ?

Before suggesting you the ULIP , the agent should have asked you all the details about your Cash flow (salary , Expenses) and your future goals with ULIP investment should address . He should also try to understand if you can take the risks associated with ULIP . If he does not ask you these thinks , ask him back why he has not asked you these questions . Get the word out of his throat .

4. How is it better than other ULIPS ?

Ask him what is unique with his ULIPS , make sure he does start all non-sense of Sec 80C benefit , high returns and all .. Every ULIP has it . Ask him what are the special features with ULIP and how do they address your requirement . If he claims that his company ULIP is best and no other ULIP can match it , ask him for references if any states that . Just a plain claim from agents will not do .An agent must have enough knowledge to make you understand how to make best use of your ULIPS .


5. How does it score over Term Insurance + Mutual funds combination ?

ULIPS are combination of Insurance and Investment product , There is no point in taking it, if it cant perform better than Term Insurance + Mutual funds SIP . Switch benefits in ULIPS are the main benefit in ULIPS. He must put pressure on that point , If not he is him self not aware of it . Refrain from taking the policy if he starts claiming that returns from ULIPS will be much higher than Mutual funds .

6. What was the performance during Market Crash ?

Agents generally try to put up rosy picture and hence refrain from disclosing the funds performance in bad markets. If the fund has done bad , that is acceptable . Its investor responsibility to take care of switching and asset allocation . So there is nothing wrong in performing bad in bad markets . Agents will first try to avoid the confrontation , but finally may tell you that they did bad and returns are very low . Ask him for exact number in return and try to find out how other ULIPS performed .


My personal Experiences

I have never come across any ULIP agent who has tried to sell the product in a professional manner . This has its own reasons like meeting Sales Target pressure or poor training to Agents. Anyways ,its not acceptable and can not be accepted . For so many years , Mis-selling is happening in India .

Conclusion :

Your hard earned money should go in proper investments . There should not be hurry in taking action , So dont feel shy in asking questions once or twice or thrice , understand the product and its suitability with your requirement.

No product is good or bad , its only bad or good depending on your requirements . So be informed Investor and dont fall prey to Idiotic agents .

Dont do mistake done by tons of investors who took ULIPS for 3 years

- To save tax
- To make exceptional returns from Stock markets .
- To make them self believe its a happening product because it looks so complex .


Please share with me if you have taken ULIP for wrong reasons
- Do you think that ULIPS will have any success in future .. I feel yes

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Regards
Umesh Aggarwal,
MJR Invest & Financial Remedies,
90, Ist Floor, Deep Complex,
Court Road,AMRITSAR-143001
92166 13217

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