Download Tax Saving Mutual Fund Application Forms
Invest In Tax Saving Mutual Funds Online
Leave a missed Call on
94 8300 8300
Life insurance penetration in India is very low, primarily because of the low level of financial literacy in the country. But, it is surprising that even high income earners are not adequately insured.
A study of 3,000 individuals by Bigdecisions.in, a financial services portal, shows that even high income earners may be going about in life with barely 10-20% of the insurance they actually need.
Life insurance is meant to provide financial support to your family and dependants if something untoward happens to you. So, the life insurance cover should be big enough to generate an income for the family of the insured person. This would take care of the living expenses of the family. But, the cover should also settle all outstanding loans as well as provide for big-ticket one time expenses, such as a child's higher education and wedding.
High-income earners at maximum risk One may think that high income earners have lower need for insurance. On the contrary, they require higher cover because most people have huge home loans and other big-ticket borrowings. With higher expense levels the higher income group is at a higher risk
The study by the online portal shows that despite the popularity of online term plans offering huge cover at low rates, individuals in the high income bracket of `35 lakh-40 lakh per annum are inadequately covered. We also noted that the insurance cover did not increase in the same proportion as the increase in income.
Adequate life cover won't cost the earth if you buy the right type of policy. Traditional plans offer a smaller cover because they are essentially investment vehicles. At the age of 3035 years, a person will be required to pay a premium of almost `8 lakh-10 lakh a year for a cover of `1 crore.
Only the super rich will be able to afford such a plan. For the average buyer, a better option is a pure protection term plan which can offer the same cover for `8,000-15,000 a year, depending on the age and social habits of the buyer.
One should not be lulled into thinking that the life insurance cover he has is enough. A sum of `1 crore might sound big, but even an inflation-adjusted monthly withdrawal of `50,000 will deplete the entire corpus in less than 20 years. This is when we have assumed annual returns of 9% from the corpus and an inflation of 8%.
Should we blame it on low commission for agents? Why are people not tak ing adequate insurance?
It's not difficult to see where the problem lies.
Traditional life insurance policies, which offer very low cover, but charge a high premium, are the focus of insurance agents because they fetch higher commissions. An agent will pocket `30,000-35,000 if he sells a traditional policy with an insurance cover of `10 lakh. A term insurance policy with a cover of `50 lakh, on the other hand, barely earns him `1,0001,500. The study finds that protection is a lower focus area and a larger portion of the premiums are going into savings-cum-insurance plans.
The good news is that insurance companies are not only offering big covers, but are actively encouraging buyers to take larger covers. Some even offer a discount if the buyer takes a high-value cover. Apart from that, when an online buyer keys in his income details, he is prompted by the website to go for a cover commensurate with his income.
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
Leave a missed Call on 94 8300 8300
Leave your comment with mail ID and we will answer them
OR
You can write back to us at
PrajnaCapital [at] Gmail [dot] Com
---------------------------------------------
Invest Mutual Funds Online
Download Mutual Fund Application Forms from all AMCs
Download Mutual Any Fund Application Forms
---------------------------------------------
Best Performing Mutual Funds
- Largecap Funds Invest Online
- DSP BlackRock Top 100 Fund
- ICICI Prudential Focused Blue Chip Fund
- Franklin India Bluechip
- ICICI Prudential Top 100 Fund
B. Large and Midcap Funds Invest Online
- ICICI Prudential Dynamic Plan
- HDFC Top 200 Fund
- UTI Dividend Yield Fund
- Birla Sun Life Front Line Equity Fund
- Franklin India Prima
C. Mid and SmallCap Funds Invest Online
- Reliance Equity Opportunities Fund
- DSP BlackRock Small & Midcap Fund
- Sundaram Select Midcap
- IDFC Premier Equity Fund
- Birla Sun Life Dividend Yield Plus
- SBI Emerging Businesses Fund
- HDFC Mid-Cap Opportunities Fund
- ICICI Prudential Discovery Fund
D. Small and MicroCap Funds Invest Online
- DSP BlackRock MicroCap Fund
- Franklin India Smaller Companies
E. Sector Funds Invest Online
- Reliance Banking Fund
- Reliance Banking Fund
- ICICI Prudential Banking and Financial Services Fund
F. Tax Saver Mutual Funds Invest Online
1. ICICI Prudential Tax Plan
2. HDFC Taxsaver
- DSP BlackRock Tax Saver Fund
- Reliance Tax Saver (ELSS) Fund
G. Gold Mutual Funds Invest Online
- Relaince Gold Savings Fund
- ICICI Prudential Regular Gold Savings Fund
- HDFC Gold Fund
- Birla Sun Life Gold
H. International funds Invest Online
1. Birla Sun Life International Equity Plan A
2. DSP BlackRock US Flexible Equity
3. FT India Feeder Franklin US Opportunities
4. ICICI Prudential US Bluechip Equity
5. Motilal Oswal MOSt Shares NASDAQ-100 ETF
Posts
No comments:
Post a Comment