Why claim settlement ratio will not help you choose a term life insurance policy

Claim settlement ratios (CSR) published by IRDA do not represent the probability of claim acceptance. Most private insurers have a claim settlement ratio comparable to that of LIC. Therefore the CSR will not help you choose a term life insurance policy. At best, CSRs would help you reject a few insurers. Here are some insights … Continue reading Why claim settlement ratio will not help you choose a term life insurance policy

Will Life Insurance Claim Be Denied Without a Valid Driver’s License?

Will a life insurance claim be denied if the insured died in an accident where he was the driver without a valid driver's license or valid vehicle insurance? Thanks to a question by Ganapathy Krishnan at Facebook group, Asan Ideas for Wealth, I was able to obtain an authoritative answer to this question from the insurance … Continue reading Will Life Insurance Claim Be Denied Without a Valid Driver’s License?

Are You Sure That A Term Life Insurance of One Crore is Sufficient?!

Everyone wishes they were a crorepati and this seems apparent from the sum insured chosen for a  term life insurance policy! Why is everyone buying a "one crore" policy? Because it is a large sum? One followed by seven zeros (ten million) is just a number. It may or may not be the right number … Continue reading Are You Sure That A Term Life Insurance of One Crore is Sufficient?!

Why Time is Money and How Life Insurance Plans Exploit it!

Benjamin Franklin wrote in 1748 that Time is Money in a note titled "Advice to a Young Tradesman”. This can be used in multiple ways and in this post, I use it to explain an important idea known as the Time Value of Money. Shall try to follow it up with other examples in future posts. Journalist … Continue reading Why Time is Money and How Life Insurance Plans Exploit it!

How ULIP Charges Reduce Returns!

The charges associated with a Unit linked Insurance Plan (ULIP) can significantly impact the returns from the policy. A two-part discussion on ULIPS: first how charges reduce returns and then a category-wise study of ULIP returns and how to compare them with mutual funds. This post is entirely due to an interesting thread started by Guru … Continue reading How ULIP Charges Reduce Returns!