Please be aware of the fact that insurance in not a commodity like a television set or music system which you buy once , pay once and enjoy the benefits. Please be very careful before buying a life insurance product in particular. In life insurance the premiums are usually paid for a couple of years and in some cases like term insurance policy many years. So compare , study and also do some research on your own before buying the policy. The hard work and time invested prior to buying the life insurance policy will insure that you do not regret the decision later in life.
Most of the insurance policies across the world are sold by insurance agents/agencies , insurance brokers or Banks. Now the prime motive of any person to take an agency to sell insurance is MONEY or the commission. No body is here to do charity and that is the fact of life and lets face it and it has been seen that many insurance agencies try to push products which have the highest commission payouts without taking into account the need of the investor.
Make sure that you do not fall into the TRAP. We tell you some important questions to ask you insurance advisor weather he is an insurance agent , broker or your friendly neighborhood bank selling insurance.
1. Try to find out his knowledge about the important developments in the insurance industry. Is he aware about other companies products on offer. How can a person say his product is the best without knowing the product features or prices offered by other insurance companies operating in India.
2. When ever you are fixing an appointment please ask your insurance advisor to provide his Agent License Number , When was it issued and when is it expiring.
3. How many years of experience he has in selling Insurance. There has been some case where malpractices has been reported in the exams conducted for insurance agents in the past.
4. Take every communication in writing in physical or through email and keep it safe.
5. All insurance agents have a relationship manager on the rolls of the insurance company and the agent or advisor has to report to him on a regular basis. Take the Name of the relationship manager, Phone Number and address of the branch office the advisor is reporting to.
6. Tell the Advisor to make the illustration for the product on writing along with his signature or ask him to send it through his mail account.
7. If the advisor is making promises like 15% returns or 20% returns tell him to give everything in writing. There has been countless number of cases where Advisors have promised more than 25% returns on some insurance products and lured customers to invest in those schemes. According to IRDA the illustrations can be made on 6% returns and 10% returns for insurance products.
8. Never ask for a commission payback form the Advisor and also do not entertain advisors who offer you commission payback. The commission is the only incentive the advisor gets to service you in the coming years. If you want a good service from the advisor then never ask for it.