Do Not Get Conned !! Insurance Is Not Investment !!

Resident Duped By Bankers, Given An Insurance Policy Instead Of Fixed Deposit.

By Anindita Roy with inputs by Gurpreet Singh(10, Hemkunt Colony, New Delhi)

Now that Banks can offer Insurance too, some Bankers have started misleading consumers by suggesting insurance products are good investments. Certain insurance covers offer good maturity value, so maybe you get your life covered but don't hand over your savings!
However, when your Banker instead of misleading you verbally by suggesting insurance in place of fixed deposit, knowingly invests your money in Insurance instead of fixed deposit what can you do? Can you take any legal step ? Or do you have to just accept the policy document ?
So what steps can be taken so that you are not duped? Here are some precautions:
Please ensure that you do not leave empty fields in the form that you are filling. Get all information filled in front of you, or check that all information has been correctly filled in before you put in your final signature.
Fill your check with your own hands using your own pen and never issue blank cheques, whether amount or name. Always fill the name of the payee and fill the correct amount yourself. Using your own pen to fill may save you from getting duped majorly as many con-men are using pens with fading inks. Never leave preceding or succeeding spaces between the numbers and cross the spaces if any.
So, why will the banking agent try to give you an ‘Insurance Policy’ instead of a fixed deposit ? This question is very easy to answer: the agents get a high commission for an insurance products and no or very minimal commission for a fixed deposit plan. Today, a traditional insurance product, whether term or endowment, typically earn agents up to 30 per cent of the first year premium, seven-eight per cent of the second year premium and four-five per cent of the premium during the rest of the policy term. Agents sell investment plans more because the premium amount is far higher in non-term plans than in term plans and, therefore, so is the agent’s commission. And for fixed deposits there are no commissions to be paid!!
Also, if you withdraw your Insurance policy before a certain date you get only a certain amount back, whereas you can fully withdraw the amount invested in a fixed deposit just with a lesser amount of interest. Another fact is that, the more your age, the higher is the premium amount and higher is the agent’s commission... So, there is no comparison between a fixed deposit and an ‘unwanted’ Insurance plan !!
Hence, the duping occurs and the poor customer suffers. One can definitely start a legal case but the hassle is too much !! So take precautions and do not get duped .