Hornmerchant's BLOG

There are two types of self-serving Insurance intermediaries – Online Portals and Insurance “Salesmen”. Each of these are broadly of two types again. Two types of Online Portals are – Aggregators, earning referral fees and Brokers earning commissions. Online portals are too focused on conversions and quick sales than understanding the customer needs, educating the customer etc.; well online portals are not built for that kind of high-touch & personalized engagements. Then, two types of Salesmen are – Sales Staff of Banks or Sales Executives, earning incentives, lured by pay hikes/promotions and Individual Insurance agents earning commissions, lured by foreign trips etc. These salesmen too are too focused on achieving their personal sales numbers than what is best for the customers. A disclaimer to clear any smallest doubt – No, I don’t mean all of them are same; not all are bad. Then there are media houses, bloggers, vloggers, influencers earning th r ough ads or/and referral f...

An argument I have to frequently counter about insurance is based on “Cost-Benefit” analysis. Well, no person would mention their argument to in that exact phrase but they mean that. That means they argue, compared to the claim (sum insured) amount I may get and the premium I am being charged for that is far lesser. So why should not I take that insurance / feature, though it costs slightly more. This argument is faced in situations like buying an add-on / rider with the main policy, buying for longer tenure / term, too much (features) for too less (price / premium). My advice is understand and anchor on to what you NEED. Consider the options available. For illustration, say, following for offer: P-1 [Primary Offer], a product (policy) that just satisfies your needs with reasonable pricing and there are competing products.  A-1 [First alternative / competing product]: charges slightly more and offers some add-on’s which are not needed / not so much useful to you.  ...

There are already plenty of articles written on ULIP vs MF.  This an FAQ. This became further more VFAQ since Long Term Capital Gain (LTCG) Tax was (re)imposed on Equity Mutual Funds. This question started when Life Insurance policies became Investment vehicles more than Risk management instruments. But now Mutual Funds have started offering Life Insurance! This kind of ‘cross-border invasion’ has created all the more confusion. Then what is the purpose of this one more article about the same matter? What more or different I have to say about this Frequently Asked and Widely Answered Question? I wish to talk about the practical (relevant) and less discussed points. End of the day they are the most important. Well, however, for the relevance of the topic it may be inevitable to repeat some things you already know or what other hundreds of articles have already spoken about a lot. PERFORMANCE: Let’s begin with first things first. The Returns…Performance. This is at the top...