Happy New year

Dear Friends,

             Happy new year.... Hope this new year will get all success for every one of you... :) 

Best in Unit Linked Plans

Dear Friends,

           So many people will afraid to invest in unit linked products, most of the people know only one side of the coin of unit linked plan,  There is other side of the coin for these unit linked plans which offer us some kid of less risk, Lets see how these unit linked products work for a intelligent investor.

For example i am taking a product in which there are 5 fund options. The reason why i am taking like this is typically all the unit linked products will come with 5 fund Options and 2 to 4 switches free per year (in some funds there will be 2 free allotment switches free per year).

If we suppose two investors Mr.Mukesh and Mr.Mahesh how took this Unit Linked Plan ( any thing with insurance or with out insurance ), both invested 50K per year. If we suppose these people started investments in 2006 when markets (BSE-SENSEX) are at 10K levels, at these levels if they all ready invested two premiums then lets think the fund value is 1lakh, i will consider the funds in the Unit Linked Plan are Index performers ( most of the times funds will out perform the indices's).  

Lets see how these people made money in the markets with the help of unit linked plans.

           This image will show there funds values at levels when BSE Sensex fall to 8K in recent times. Mr. Mukesh used switching option provided by the Plan to grow his fund value and Mr. Mahesh Simple invested and stayed like that with out any switching in the funds.  

Simple logical thing every one should understand about this fund switching. when Stock markets are at low levels we should start putting our money and when its going up we should start with draw or move that to debt fund options provided in the Plan, these type of debt funds are not going to depend on the Equity markets. 

Lest so how this happened in this Scenario.. When Sensex is at level 10K both fund values are at 1,00,000 and when market reached 20K level there funds values gone up in a short time of duration so he switched his funds at 20K level to debt funds. after the 20K mark Sensex reached 21K level also but it started falling down.. this may be because of economic problems, in general there will be a small correction in the market followed by a relay in the market. 

At 20K level there fund value is 2,00,000 (2 lakh), because Mukesh moved his funds into debt fund there is no down fall in his fund value but for Mahesh fund is gone down with sensex. At 8K level Mukesh moved his funds (2lakh) in to equity oriented fund so when it gone up to 10K level (2.5 Lakh) the fund value he moved it back to debt fund. Ultimately he is with 2.5lakh now at the current levels. but where are Mr. Mahesh did not do all these things so he is with 75,000 now.

This is the big advantage of Unit Linked Plan over other investment Options ( Mutual Funds ). so if every one try to use this option what really help them to grow their fund value much better than any other funds.

why you need to plan for retirement?

Dear Readers,

Greetings from Ram Financial Consultancy, I would like to share some important facts with all of you about some pension plans which are use full for your tax planning as well as your retirement planning, now a days so many people are neglecting about the retirement plans. First i would like to share some survey results with all of you.



Year 2020 prices are just productions with minimum price increase in the products. Even in the worst situations prices may cross this or may be less also.




In above tables will show you how cost of leaving is rising in India, to day you are working so you can spend but thinking about tomorrow once you are retire from your job, Do you know how much you need to send per month for you and your wife to maintain same life style.

Your Today's Spending per month : 20,000 ( for a family of 3 people )
After 25 years from now expenses per month : 3,83,000 ( for a family of 3 people )

this table is created by taking the cost of leaving is rising @ rate of 9% per year. simple logic behind this.

So to ensured that you are maintaining the same life style you need to keep up and plan for your retirement.

Government is showing that inflation is near 5% from last 4 to 5 years but actually the prices are rising more than that. please keep your eye open so the real inflation.

For best retirement or Pension plan please contact us @

Email id : sriram.adviser@gmail.com
phone no : +91-9741598945 (India)
+1-408-250-9952 (USA)

Know about your ULIP

Dear Readers,

             Now a days agents are promoting more ulip's than traditional insurance plans, but still there are some terms which are not clear to the end customers, so i would like to present hear some details about the ULIP which may help the readers to understand about there ULIPS. 

First lets look into the charges and term involved in the ULIPS.

Most of the insurers try to be transparent about these changes in the brochures & in policy documents, most of the policyholders don't understand what they  are being mad to pay for. There are seven common changes that come with a ULIP:

• Premium Allocation Charges 
• Fund Management Charges 
• Policy Administration Charges
• Mortality Charges
• Fund Switch Charges 
• Surrender Changes
• Service Tax Deduction

Let's see these in details 

Premium Allocation Charges: The entry load charged on issuing the units under the policy. This normally includes initial and renewal expenses, apart from commission expenses.

Fund Management Charges : This is the free levied for management of the fund(s) and is deducted before arriving at the net asset value (NAV).

Policy Administration Charges ; This is the fee for administration of the plan. It is levied by the cancelling units worth the amount every year. This could be flat throughout the policy term or vary.

Mortality Charges : This is the cost of the insurance cover offered in the policy. Mortality Charges depends on a number of factors such as age, amount of coverage and health of the policyholder.

Fund Switch Charges : Most insurance companies offer four free fund switches in a year. The subsequent switches are charged.

Surrender Charges : A Surrender charge may be deducted for premature partial or full encashment of units wherever applicable, as mentioned in the policy document.

Service Tax Deduction : Before allotment of units, the applicable service tax is deducted from the risk portion of the premium. Some companies absorb this cost.

For more information  please contact :

Venkataramana.D

Email id : sriram.adviser@gmail.com

Phone No: +1-408-250-9952

This information is take form Money Today

Traditional Plan Vs ULIPS

Dear Readers,

           This is the table to comparision of Traditional insurance plan with Unit Linked Insurance Plan (ULIP). When you people are taking any dession about the insurance which you are planning to take, this table may help you in making such dession.

FEATURES	TRADITIONAL PLANS	ULIPS
Investment mix	High exposure to bonds and no choice to hike equity exposure	Policyholder can choose exposure to debt, equity
Transparency in cost	No	Yes
Alter scope of cover	No change possible in sum assured and premium	Freedom to enchance life cover, top up premiums
Charges	Variable charges through the term of the policy	Flat charnges throughout the term
Vary exposure to risk	No option for policyholder to alter exposure to risk	Possible to switch between fund options
Premium hoiliday	No	Allowed
Liquidity	Plociyholder can take a loan against the policy after three years	Partial withdrawals allowed after three years
Policy value	Complex calculation to arrive at paid-up value after 3 years	Surrender value indicated at the end of each policy year

this table is taken form Money Today 

For more details please contact our adviser 

Venkataramana . D

email id: sriram.adviser@gmail.com

phone no : +91-9741598945

What does life insurance have to offer?

               Life insurance is many different things to many different people. For some, it is a premium to be paid on time. For others it offers liquidity since cash can be borrowed when needed. For the investment-minded, it denotes a constantly growing capital account and numerous other benefits.

               

               Life insurance is nothing but the creation of capital funds on an installment basis. Only here, the results are guaranteed. Life insurance is basically a property that is bought under a contract, accompanied by contractual guarantees that ensure large sums of money at the death of the insured.

               

               The contractual guarantee is the promise to pay, backed by one of the oldest and most stably regulated financial industry operating in the Indian sub-continent today. Insurance Buys Time and Money People like to refer to life insurance as time insurance, the reason being that life insurance proceeds are paid to the insured's beneficiaries in case of death.

               

             The money proffered by life insurance helps buy time to adjust to the change of circumstances. Insurance provides large amounts of cash that will keep the lifestyle for the survivors the way it was before the insured's death.

               

                Insurance Offers Peace of Mind For the person who buys an insurance policy, it offers absolute and complete peace of mind. He or she knows that the decision made by him will provide sound benefits in the future, whether or not the individual may live to see it. The life insurance policy will subsequently prove this in the future if and when funds are needed. This is the guarantee of the insurance contract. Multiple Applications The future is uncertain for each and every one. No one knows how long he or she will live.

             

                 The investment benefit is paid to the insured's beneficiaries after his death or it can be used during the life as well. Life insurance policy owners can turn to the cash value of the policy in case of a financial emergency when all avenues are either blocked or denied. They know that they can avail of loans based on their insurance policies. Insurance policy owners can use the cash value of their policies to meet their long-term financial needs as well. They may have purposefully invested in insurance to use the cash in the policy for their children's future marriage expenses or higher education fees.

               

                  Enduring Elasticity Since life insurance is flexible enough to serve several needs, the insured can keep several long-term goals in mind once he or she invests in the insurance plan. The cash value of the policy can be allocated towards augmenting the monthly income during the retirement years. Leisure years should be turned into pleasure years. Permanent life insurance is designed on the concepts of long-term flexibility.

                    Financial Security The insurance policy offers contractual guarantees to people looking for peace of mind when they buy life insurance. Life insurance offers complete financial security. The purchase of life insurance demonstrates concern for a family's future financial well being. Regard for Family The purchase of life insurance clearly displays care and concern for the people the policy owner loves. Insurance is Safer No financial institution can do what life insurance does. No industry can back its products with reserves and surplus as sound as those of the insurance industry. The proof of strength and safety that insurance companies have ensured even under the most adverse of conditions is a matter of pride for the entire insurance industry. For generation after generation, life insurance has been acclaimed as the very benchmark of security against which the other industries are measured.

For more details please contact :

Venkataramana.d

email id: sriram.adviser@gmail.com

phone no: +91-9741598945

 


 

Why Life Insurance necessary..?

Dear Readers,

When it comes to Life Insurance, many of us will tell that we don't need any insurance, and ever some people say why we need life insurance, lets me explain you about why we need life insurance cover. Once after completion of reading this article please put your comments/recommendations in the comments section. Thanks in advance for your comments/recommendations.

A well-planned life insurance fund can clear the pending debts of the insured after his or her imminent demise. At times, this can mean the difference between retaining the family house & heirlooms and losing it by default to the creditors.

It can also avoid the possibility of a distress sale where by an item might have to be sold at a much lower price owing to the urgency of funds. Insurance can also pay for the cost of higher specialised education. Education in certain specialised fields can cost a staggering amount and owing to the intense competition in the job market today, not many people have the liberty of choice. The need of education is clear. Parents who want to provide for their ward's education must carefully save money to provide for their future. Scholarships are not easily available either.

Life insurance can easily provide for expected educational costs even if the insured dies before his children's education is complete. At times, after the death of the sole-earning member of a household, the surviving spouse may need a secondary qualification current to the prevailing employment market situation.

This additional education is critical since only one parent has to bear the responsibility of the entire family. A life insurance policy can provide the funds required to stabilise the family situation until the pending tension has eased off.

-- Do you need life insurance?

Every person has an economic value in life, which is connected to the income potential of the individual. So every income provider or producer has to be properly insured against any shortfall that might result from his or her death when some one else will be dependent on that person's income for financial security. Without proper planning, a sudden financial emergency can force a family to act in a manner that would be inconceivable or unthinkable for most parents. They might have to halt children's education and/or have to sell the house and/ or the car and/ or fall deep into debt.

Life insurance does not replace the intrinsic value of a person's metaphysical self. Nothing and no one can. What it does attempt to provide is solid and tangible security to weather the storm that might befall the individual's family and dependents after his demise.

For Life Insurance please contact:

Sriram.

Email Id: sriram.adviser@gmail.com

Feel free to write your comments in comments section...

Life time cover ploicy

Dear Readers,

Greetings from Ram Financial Consultancy, We are best in serving your needs from long time, we would like to give some idea about the whole life cover plans, first i would like to tell you one thing there are so many types of insurance plan, either it is endownment plan of unit linked plan it should match our requirement and it should yield good returns for us. There are lot of comments about the comparison of Endownment plan and Unit Linked Insurance Plan, but our ultimate goal is to identify the best plan which suites for us. Lets start our discussion, There are so many companies products which will provide while life cover (typically 100years insurance cover) , i would like to address hear about how to select best out of the available products in the market.
Lets start with comparison of two plans, one is Jeevan Anand form LIC (Life Insurance Corporation) and Other plan is Flexi Life Line form Biral SunLife Insurance Company Pvt. Ltd. Off course i will agree that Jeevan anand is endownment plan and Flexi Life Line is Unit Linked Insurance Plan, If you select Debt funds in the Unit Linked Insurance Plan, where there is 0% dependence on the equity markets, then you can expect a fixed returns on your investments with very less risk ( less risk means, your fund performance depends on the interest rate in the debt market ), In Endownment plan the bonus is also depending on the performance of the company which is again with less risk involved over ther.

Let go through the Details:

Jeevan Anand :

These details are taken form LIC web site, source from Jeevan Anand
This plan is a combination of Endowment Assurance and Whole Life plans. It provides financial protection against death throughout the lifetime of the life assured with the provision of payment of a lump sum at the end of the selected term in case of his survival.

Benefits in case of death during the selected term:
The Sum Assured along with the vested bonuses is payable on death in a lump sum.

Benefits in case of survival to the end of selected term:
The Sum Assured along with the vested bonuses is payable in a lump sum on survival to the end of the term. An additional Sum Assured is payable on death thereafter.

Accident Benefit:

An additional Sum Assured (subject to a limit of Rs.5 lakh) is payable in a lump sum on death due to accident up to age 70 of life assured. In case of permanent disability of the life assured due to accident this additional Sum assured is payable in instalments.

Supplementary/Extra Benefits:
These are the optional benefits that can be added to your basic plan for extra protection/option. An additional premium is required to be paid for these benefits.

Surrender Value:

Buying a life insurance contract is a long-term commitment. However, surrender values are available on the plan on earlier termination of the contract.

Guaranteed Surrender Value:

The policy may be surrendered after it has been in force for 3 years or more. The guaranteed surrender value is 30% of the basic premiums paid excluding the first year’s premium. Any extra premium(s) paid and premium(s) towards Accident Benefit are also excluded.

Comments: This seems to be not a good one in this plan, if a person want to quit the plan after paying the premiums for few years ( example @ 15th year) then he will lose lot of amount. we will see this illustration @ the end of this article. in the example case study

Corporation’s policy on surrenders:

In practice, the Corporation will pay a Special Surrender Value – which is either equal to or more than the Guaranteed Surrender Value. The benefit payable on surrender reflects the discounted value of the reduced claim amount that would be payable on death or at maturity. This value will depend on the duration for which premiums have been paid and the policy duration at the date of surrender. In some circumstances, in case of early termination of the policy, the surrender value payable may be less than the total premium paid.The Corporation’s surrender value will be reviewed from time to time and may change depending on the economic environment, our experience and other factors.

Case Study :For Example a per son with age 25 years take a jeevan anand policy for 21 year and coverage term as 100 years (whole life), let see hear how it works. You can calculate your premium from the URL : calculator

In this example the premium is coming to be around 49,522.00 per year but if you pay your premium half yearly you are premium per half year will go to 25,162.00 means which is higher than yearly by 802 Rs/-. in the same way this will go up if you pay Quarterly or monthly. this is for a cover of 10lakh.

we will take 49,522.00/- and see how it works out.

In case of survival:

Policy holder would be paying 49,522.00/- per year and for 21 years and survived then he will get 10lakh + Bonus ( this is uncertain which depends on the company performance this may works out to be less than 3% to 4% per year as per the information i got for the customer service representative of LIC), but in this case you are paying 1039962/- means you all ready loosed 39962 /- out of what you payed in this plan.

In case of surrender:

If the person is not able to pay the premium in regular basis then if he want to surrender this plan in 15th year (this 15th year is an example), then what is the Guaranteed Surrender Value he can expect is 30% of the basic premiums paid excluding the first year's premiums. in this case you are surrender value in 15th year is 193135.8/- means out of 693308 paid in 14 years you are going to lose 500172.2 (5lakh).

In case of death:

The Sum Assured along with the vested bonuses is payable on death in a lump sum.

Flexi Life Line Plan:

This plan is a combination of Unit Linked Investment Plan and Whole Life plans. It provides financial protection against death throughout the lifetime of the life assured with the provision of payment of a lump sum at the end of the selected term in case of life insured survival.

Benefits in case of death during the selected term:

Higher of ‘Fund value’ or ‘Guaranteed Fund’ or ‘Sum Assured’ less all applicable Partial Withdrawals in the 24 months preceding the death of the life insured.

Benefits in case of survival to the end of selected term:

A minimum guaranteed return of 3% p.a. applies on premiums and top-up premium, net of policy charges and survival benefits. This total will constitute the Guaranteed Fund Value. In case of survival higher of the ‘Fund Value’ or the ‘Guaranteed Fund Value’ (based on 3% net returns)

Accident Benefit (Accidental death and Dismemberment Benefit Rider):

There is option to add additional options like accidental death benefit in this plan, along with lot of other riders(riders means additional coverages).It provides 100% of coverage in case of death due to accident; loss of more than one limb or sight in both the eyes or in case of loss of one limb and loss of sight in one eye; 50% coverage in case of loss of one limb or sight in one eye. The coverage amount can go upto 5lakh depending on your requirement with the small amount of extra premium.

Supplementary/Extra Benefits:

You can further customise Birla Sun Life Insurance Plan by adding riders to the base plan at a marginal extra cost.

Term Rider: It provides additional amount of cover in the event of death of the life insured. ...Know more
Critical Illness Rider: It provides a cover in the event of life insured being diagnosed as suffering from any of four illnesses specified under the Critical Illness Rider. ...Know more
Critical Illness Plus Rider: It provides a cover in the event of life insured being diagnosed as suffering from any of the seventeen illnesses specified under the Critical Illness Plus Rider. ...Know more
Critical Illnesses Woman Rider: It provides a cover against several critical illness including woman specific illnesses. Pregnancy complications and congenital anomalies in a new born child. ...Know more
Waiver of Premium: This rider waives payment of future premiums on the happening of any of the unforeseen events as covered under this rider. ...Know more

Surrender Value:

The policy can be surrendered any time during the tenure of the policy. The surrender charges will be zero after the 4th policy year. In case of surrender in the first 3 policy years the benefits will be paid out only after the 3rd policy year. 0% Surrender charges are really good option for the people how can't continue the policy because of unexpected financial problems.

More details how surrender charges are calculated: The Surrender Charges are levied in the first four years and varies based on the duration of the Policy. During the first 24 months of the Policy, the charge will be an amount equal to the annualised Life Insurance Coverage Premium payable for this Policy. For the purpose of Surrender Charges only, annualised Life Insurance Coverage Premium is defined, as the amount that is payable if the Coverage Paying Period is equal to the Coverage Benefit Period. In the 25th month, the Surrender Charge is 24 percent of the annualised Life Insurance Coverage Premium. The Surrender Charge per cent reduces by one for every month thereafter. If the Policy is surrendered at any time after the 49th month, the Surrender Charge is zero.

The Surrender Value is calculated after deducting the Surrender Charges from the Fund Value.

Fund Options:

Individual Life - Protector : The equity component in Individual Life -Protector is 0% –10%. which means fund manager can invest upto 10% of money in equity depending on equity market conditions this could be 0% also.

The asset allocation for fund is given below:
Debt(G-Sec, Corp Bond & MMI)* : 90%-100%

Equities : 0-10%

*Includes Money Market Instruments upto maximum limit of 40%

Individual Life - Enhancer:
The equity component in Individual Life -Enhancer is 20% - 35%. The asset allocation for fund is given below:
Debt(G-Sec, Corp Bond & MMI)* : 65%-80%
Equities : 20%-35%
* Includes Money Market Instruments upto maximum limit of 40%

Individual Life - Builder:
The equity component in Individual Life -Builder is 10% – 20%. The asset allocation for fund is given below
Debt(G-Sec, Corp Bond & MMI)* : 80%-90%
Equities : 10%-20%
* Includes Money Market Instruments upto maximum limit of 40%

Fund Switches: Policy holder can switch between the fund twise between the funds for free in a policy year after that they will be charged with 100/- per switch between the funds iresepective of the fund value.

For more details about the plan click on Flexi Life Line Plan

Case Study:

For Example a per son with age 25 years take a jeevan anand policy for 20 years and coverage period as 100years ( which is whole life), let see hear how it works. If a person opts for 10 lakh as insurance coverage, then in that case the annual premium is 36000. In this plan policy holder can opt for any one fund option depending on his risk profile, low risk fund Protector can generate a fixed returns because of its debt fund investment options.

The following table is a part of an example of the illustartion generated.

* for clear image click on the table to view it as large image

In case of survival:

Policy holder is paying 36000 Rs/- per year, for 20 years he would have payed around 7,20,000/-. @ the end of 20th year this fund value is around 941092/- ( if your fund is growing @ 6%), 1476778/- if your fund is growing @ 10%. but there is one more option in your policy Guaranteed Policy Fund which is 767294/- (higher than what every you payed). the maturity value will be higher of all these.

Fund Performance is : NAV as on 1st Jan 2002 is 10.9688 and NAV as on 1st Jan 2008 is 17.5906 which means this fund gave a returns of 65.8129% from 2002 (10.9688% average growth per year after adjusting the fund management charges).

In case of Surrender:

Lets go with 15 years as i explained in the first example of the case study. In 14th year Guaranteed Policy Fund is 474472/-, if your fund is growing @ 6% CAGR then surrender value is 544377/- and if your fund is growing @ 10% CAGR the surrender value is 734398/-, lets go with the Guaranteed Policy Fund its 474472/- in 14 years you payed 5,04,000/- means you are loosing around 29528 which is less than your 1 year premium. but if i consider the fund value in that case you are not loosing any thing you are all ways getting more than what ever you payed, fund is growing with a fixed growth so policy holder can get more than what ever he payed in while surrender also.

In case of death:

Higher of ‘Fund value’ or ‘Guaranteed Fund’ or ‘Sum Assured’ so minimum amount nominee will receive is 10lakh.

Now lets make some table comparison of the plan:

values used in this table are used from the above case study.

Any individual who is seeking life insurance policy want to get the good insurance coverage for less premium and want his money to grow with less risk and more transparency. So i will recommend the Flexi Life Line Plan as the best one out of these two plans.

For more details please contact us

E-mail : sriram.adviser@gmail.com

Phone no : +91-9741598945 (India)

Prevent your policies from lapsing

Regular and prompt payment of premiums is the single most important requirement of maintaining your policy in full force at all times.

After all, all your plans for the protection of your near and dear ones as well as your investment for your old age could be nullified due to your policy lapsing due to non-payment of premiums. Yet, thousands of policies issued by most of the insurance companies do lapse after a few years as a result of negligence and carelessness of the policyholders in making regular premium payments. A grace period of 30 days is allowed for payment of yearly, half-yearly and quarterly premiums and fifteen days, in case of monthly payment of premium.

Please do NOT wait until the last few days of the grace period.

The safest way to pay your premiums is on a yearly basis. Even if your policy has commenced on a quarterly premium basis, it is advisable to change it to yearly payment later on. The lesser your transactions with the insuring company, the better. Besides it is easier to remember the due date in a year. The more frequent the payments, the higher are your chances of the policy lapsing.


for more information mail us @ sriram.adviser@gmail.com

Necessary facts for every one

Dear Friends,

Some fact Which are necessary for every one.

I meet so many people in my life, when we used to discuss about insurance, i use to face more question, One question is i use to ask them also like how much insurance they had, they use to tell me "iam paying 30K per year or 24K per year" but this not the correct answer i am asking about the cover but they are telling about what they are paying, but really they don't know what they are getting, Now its time for you to think about this. This is not a difficulty time for common man to know about this. Let See hear how to calculate your insurance needs.

A person how is earning 25K per month. If the person is sending 20K per month to his/her family, then it means the family requires 20K per month to maintain the same life stile, No one know about the good & dab times, in case of unfortunate event of death to that person also the family should get 20K per month. Lets see how this can happen when the person is not there if that family get say 1core rupees to that family.

50lakh ---> Kept in Term Deposit ( which is giving say 8% returns yearly)
50lakh ---> gives returns of 350000 lakh per year ( 30% will go away as tax ) => 2.45 lakh per year which => 20416 per month

So This is the way to calculate your insurance needs, but think how many of agents are doing this to help you out in finding your insurance needs. They are looking for there commission, when you ask any Insurance agent they ask us to pay some X amount ( may be 25K or 35K for insurance cover of say 5 lakh), but we can give the plan which gives 50lakh insurance cover for 30 to 34K per year. on maturity you will get All money you payed as Guaranteed Maturity Benefit, and you can get extra returns depending on Stock market.

We can give you better plan available in the market, we will think from our customer side not for agent side .
For more details please call us @ +91-9741598945.

Some more Options in our plan about Insurance:
Insurance Plan will you Accidental cover also for you.
Investment option with 3 funds.
1% as fund maintains charges ( very less compared to other Plans)
Unit linked Options is available

Always i am there to help you,
Keep in touch.
With Regards,
VenkataRamana.D
Phone No: +91-9741598945

Misleading Sales literature on Unit Linked Product

Dear readers,

Every insurance company needs to work under IRDA(Insurance Regulatory and Development Authority) guide lines, including LIC (life insurance corporation of India), There is a news about some LIC agents misleading the investors about some unit linked insurance plans, following is the news in IRDA web page about this( news 2nd March, 2007) so please be care full about this kind of people.

It has come to the notice of the Authority that some of the Development Officers and Agents of Life Insurance Corporation of India are promoting their Unit linked Insurance Product ‘Money Plus’ claiming to offer astronomical returns and guaranteed benefits at the end of specific periods. Some of the leaflets assure a maturity value of Rs 3.38 crores at the end of 20 years on an annual investment of Rs 1 lakh over a period of three years. projecting a growth of 25% per annum.

Similar claims have also been made by agents of a few other insurers.

The authority would like to clarify that such projections are misleading, inflated and also do not have the approval of the IRDA. As per the guidelines of the Life Insurance Council, the Insurers are required to project their returns at a rate ranging between 6% and 10% only. The insurers are also expected to state that even these returns are not guaranteed. It may also be noted that the returns under the Unit Linked Products are dependent on the performance of the chosen fund, which is in turn affected by the performance of the stock markets.

While the Authority has already taken up the matter with the concerned insurers, it cautions members of the public not to get carried away by such unapproved sales presentations being circulated in the market. They may take an informed decision while purchasing a policy, on the basis of proper disclosures by the licensed representatives of the Insurer.


For more details please contact:
Sriram.
Email Id: sriram.adviser@gmail.com

Know about Life Insurance

Dear Readers,

Greetings from Ram Financial Consultancy, As a part of our vision of greater financial future of every individual we planed for education about the insurance and all other financial products. In this article we want to bring into your attention about the Life Insurance.

Life insurance plays an important role in any individuals financial planning process. For it is life insurance that helps secure the financial future of the nominees/Family members. However, many individuals do not know how to go about while considering life insurance products. We have identified five points to remember before zeroing in on a life insurance product.

1. Identify your needs
Before considering life insurance, it becomes imperative that individuals first identify their needs. An individual should understand whether buying life insurance is necessary to begin with. For example, if an individual is single and earning but has no financial dependants, then he may not really need life insurance. This stems from the fact that nobody is going to be 'financially hurt' in the absence of the insured (i.e. the individual in question).
On the other hand, we can consider a married individual who has family members dependent on him ( in case of unmarried individuals also there may be dependent family members). He also happens to be the sole earning member in the family. Such an individual obviously needs life insurance. This stems from the fact that his entire family is dependant on him for financial support and in his absence, their lifestyle would be severely impaired. Such individuals should have adequate life cover as early as possible. People with financial dependents how is having debt also recommended to take life insurance.

2. How much insurance do you need?
After having identified the need to buy insurance, the next step is to ascertain the amount of cover needed. The concept of human life value (HLV) can help in deciding how much life cover an individual should opt for. The HLV takes factors like the individuals annual income and expenses along with the inflation rate into consideration while calculating the value.

• Read to know about HLV

3. Which product should you consider?
After having quantified the need for insurance, the next step is to finalise a plan that will fulfil the individuals need. There are two kinds of insurance plans - term plans and savings-based plans(Endowment Plan and Unit Linked Insurance Plans). A term plan insures the individual for a high sum at a low cost. A term plan makes for a good fit in all individuals' portfolios, irrespective of their profile.
Many individuals also look at life insurance as a savings instrument. Here, apart from insuring the individuals life for a certain amount (i.e. the 'sum assured' in insurance parlance) savings-based life insurance plans also give returns on maturity. This is unlike term plans, which act as a pure risk cover and do not give any returns on maturity.
As can be seen from the table, it could become expensive for an individual to adequately cover himself for the necessary amount with a savings-based plan due to the higher premiums. Instead, individuals can look at covering themselves with a term plan for the necessary amount and invest their savings in various instruments at their disposal like the national savings certificate (NSC), public provident fund (PPF), bank deposits, corporate bonds and mutual funds.




4. Select an insurance agent/adviser
Having understood how much insurance is needed, an individual then needs to approach a life insurance agent or adviser there is a considerable amount of difference between agent and adviser, agent will promote one company product to which is working and adviser will recommend you the best plan suitable for your needs and arrange for agent. The adviser should have a good track record to show for in terms of offering objective advice in the client's favour and not his own. This will stand the individual in good stead over the long run since life insurance needs call for evaluation every few years and the insurance adviser will help the individual with the same over a period of time.

• Comparison of whole life insurance plans.

5. Compare policies across companies
Before zeroing in on an insurance plan from any company, individuals should compare policies across insurance companies or ask your adviser to do this. This will help them in evaluating which insurance plan is best suited to their needs. One way of doing this is by contacting the insurance adviser and asking him for a comparative analysis of insurance plans. Another way is by visiting the websites of different companies and scouting for relevant information.
For example, an ideal term plan for a 25 year old can be the one that offers him the necessary cover at the cheapest cost. For a unit linked insurance plan however, different criteria like expenses, fund management and flexibility offered will come into the picture. The comparison will differ across various parameters depending on individual needs as well as the type of plan chosen.

please post your question in comments section

For more details please contact our consultant

e-mail id : sriram.adviser@gmail.com

phone no: +91-9741598945(India)

Types of Insurance Policies

You can find an insurance policy to cover almost anything imaginable but only a handful of policies are actually ones that you need to have. You work hard throughout your life to build wealth and live a happy and comfortable life, so some types of insurance can protect your possessions, income and even provide for a loved one when you are gone.

Health Insurance

One of the most important types of insurance to have is health insurance. Your good health is what allows you to work and earn money and otherwise enjoy life. If you were to come down with a sickness or have an accident without health insurance you may find yourself unable to receive treatment or even in debt to the hospital.

Thankfully, many employers provide health insurance benefits to full-time and even some part-time employees.
f you do not currently have health insurance coverage this is the first place to check as it will generally be the most affordable. If you are married, you may both be able to receive coverage under just one of the employer plans.

If your employer does not offer health insurance or you are self-employed you still need it. While it may not be cheap the fact remains; what do you have if you don’t have your health? Even a basic hospital bill without insurance can run into the thousands of dollars. It isn’t worth risking financial ruin to save a few bucks on a health insurance premium.

Life Insurance

This type of policy is more important if you are married and/or have children. Your life is valuable because it is what allows you to work and earn an income to provide for your family. When you are gone you create an income gap which could put your spouse or children in financial trouble.




Death is hard enough; don’t make it even harder by putting your loved ones in a financial jam if the unfortunate does happen. Funerals alone can be expensive and it creates even more stress on the family. At the very least you should have enough to cover basic funeral expenses and provide a cushion for your family, and at most it should provide a stream of income for your family that can replace what is now gone.

If you do not currently have life insurance your best bet is to check with your employer first. Many employers offer a basic life insurance as a benefit and some even allow you to purchase additional coverage at a very affordable rate. Outside of employer plans there are hundreds of insurance companies that can provide the right coverage for you.

• Types of Life Insurance Plans
  

Property Insurance

One type of policy that for most people that is actually mandatory to have is homeowners insurance when you have a mortgage. If you borrow money from the bank to purchase a home they will require the asset to be insured. For many people this insurance premium is built into the mortgage payment. For many people their home is their greatest asset so it is vital to adequately protect it.

If you rent instead of own, a renters insurance policy is just as important. Your belongings inside the dwelling can add up to a significant amount of money. In the event of a burglary, fire or disaster you should be able to at least have a policy that can cover most of the replacement costs.

Auto Insurance

Another type of policy that is often required is auto insurance. Most states require by law that you have basic auto insurance. While it may be a law, too many people still drive around without it.

The most common reason to have auto insurance is to cover the replacement of an expensive asset. Like a home, automobiles can be quite expensive and if it gets damaged you want to be able to repair or replace it. But there is more to auto insurance than just covering the car itself.

Most automotive insurance policies cover bodily injury or death of another person in an incident that you are legally responsible. While it generally pays for medical expenses related to the incident it can also cover legal defense costs. You will also generally find medical payment coverage that pays for medical treatment for you and your passengers during an accident regardless of who was at fault.

Know about Type of life Insurance Plans

Ever wondered why most of us end up paying insurance premiums in the last few months (January to March) of each financial year. Well, that's because, insurance polices are often bought during that time span i.e. when the tax-planning 'season' is at its peak.

The trouble with such an approach is that tax-planning becomes the cornerstone for buying insurance and the 'insurance' aspect is sidelined. Sure, tax-planning is an important factor (premiums paid towards life insurance policies are eligible for deduction under Section 80C of the Income Tax Act), however, it should never be the mainstay. While doing so, the individual could well land up with the wrong insurance policy.

The right approach to buying insurance is to evaluate one's insurance needs and then narrow down on the most appropriate policy type. Given that there are multiple players in the life insurance segment, choosing the right insurer is vital as well.

For example, a term plan could make an apt fit for a financially well-placed individual, who has no insurance cover and doesn't expect the insurance policy to generate returns.

Simply put, a term plan is a pure risk cover plan without any maturity benefit. The next step would be to scan through the various term plan offerings and to select a term plan that best matches the insurance seeker's needs.

Another element which could put a spanner in the works is the insurance advisor. For instance in the case above, the insurance advisor is unlikely to recommend a term plan, since he generally makes the least earnings on it as compared to unit linked insurance plans and endowment plans.

As a result, most advisors prefer to 'peddle' the latter, which are big commission earners, irrespective of the client's needs or risk profile. Hence it is imperative to be associated with the right insurance advisor i.e. one who accords greater importance to the insurance seeker's needs over his own.

Buying insurance should never be a rushed affair either. In such a scenario, prospective insurance buyers often end up playing into the hands of their insurance advisor. The outcome - they land up with policies, which are more beneficial (read big commission earners) to the insurance advisor. Hence it would pay to commence the insurance exercise, well before the tax-planning season kicks in.

In this article, we discuss the various options from the insurance segment that are available to insurance seekers and identify the key factors to be considered.

Term plans
Term plans offer pure risk cover and merit inclusion in most portfolios. In fact, a term plan should be the first insurance product that insurance seekers should opt for. Term plans represent the most economical form of insurance i.e. they offer a high insurance cover at a relatively lower cost.

This is because only mortality charges and administration expenses are covered in the premium amount; there is no savings element. Hence, if the insured were to survive the policy term, there will be no maturity benefits i.e. the policy holder will not receive any returns when the policy matures.

Unit linked insurance plans (ULIPs)
ULIPs merge market-linked investments and insurance into a single product. In line with their mandates, ULIPs invest in equity and/or debt instruments in varying proportions. With equity markets on a surge over the last few years, ULIPs have been sold rather aggressively. It should also be mentioned here that perhaps the most instances of mis-selling have also been reported in this segment.

The expense structure of ULIPs tends to be quite unconventional; a large portion of the premium (as high as 40 per cent) during the first couple of years is deducted towards expenses and the balance invested in line with the stated mandate.

However, the expenses do even out over longer time frames.reveal that ULIPs work out to be more economical vis-a-vis comparable mutual funds over longer time horizons (like more than 15 years). Hence it is imperative that policyholders continue with policy for the entire tenure.

Another advantage ULIPs offer is the flexibility they afford to the policyholder. The policyholder can "manage" his corpus by maneuvering it across different plans. For example, when equity markets are on the rise, he can shift a part of his corpus to a debt-oriented portfolio. Hence it would help to be associated with an expert and qualified insurance advisor who can help select the right ULIP and manage it as well.

Endowment plans
Traditionally, endowment plans ranked as the most popular option from the insurance segment. Endowment plans typically invest a major portion of their assets in government securities and corporate bonds; a smaller portion can also be held in equities.

Endowment plans are geared to offer returns to policyholders on maturity. By virtue of the same, they are often perceived as investment avenues. Child plans and money back plans are variants of endowment plans.

Although they might be structured uniquely (for example, they offer returns in installments during the policy's tenure), in essence, they are endowment plans.

Pension plans
For far too long, Rs 10,000 was a defining amount for pension plans. The reason being, that was the maximum contribution (premium paid) to a pension plan, eligible for deduction under Section 80CCC of the Income Tax Act. Yet again, a case of tax-planning scoring over insurance needs.

Union Budget 2006-07 corrected this anomaly. The Rs 10,000 limit on contributions to pension plans was removed i.e. contributions upto Rs 100,000 towards premiums paid for pension plans are now eligible for a deduction. This should encourage individuals to conduct their retirement planning with the right perspective.

In conclusion, we reiterate our view that individuals must let their needs determine the insurance products in their portfolio. Each product has its unique set of characteristics and should find a place in the portfolio based solely on the same. Notwithstanding the importance of tax-planning, the same should be treated as secondary, where insurance is concerned.

For Best Insurance

Dear readers,

If any one are looking for, investments in best ULIP or insurance products with less charges please contact SRIRAM Phone No: 09986128592.
Small example what kind of insurance product we can give to a person of Age 25 is....
By paying 25K per year, the person can get insurance cover of 30lakh(death benefit) + 5lakh (accidental rider) and @ the end of 25 years we can get our money (premium payed + returns @ 10% approximately per year). if this seems to be the best deal Contact our sales person SRIRAM (Phone No:09986128592 Email id: sriram.adviser@gmail.com)

Regards,
Ram Financial Consultancy.

Comparison of ULIP funds Vs Mutual Fund

Dear Readers, In to days volatile market every one are thinking about which is the best beet for investment. So i did a comparison of ULIP Fund Vs Mutual Funds , Hear i am comparing two cases:

case 1:
ULIP Fund (100% equity) Vs Mutual Fund (100% Equity)



case 2:
ULIP Fund (90% equity) Vs Mutual Fund (100% Equity)



Now this graphs gives us a clear picture that the best ULIPS (This means only few ULIPs not all) are all ways safer than Mutual funds( the returns are same in both cases). There are lot more advantages in ULIP.
For better Planning feel free to contact : Sriram, Email ID: sriram.adviser@gmail.com, Phone No:09986128592

Portfolio Creation

What is a Portfolio? We have all heard the word used when talking about finance, but what actually does the word mean? The actual definition of Portfolio is:

“The combined holdings of more than one stock, bond, money market instrument, commodity, collectible, or real estate investment.” When creating a Portfolio, our advisor's split the creation process into six key points, all of which need to be considered and discussed and the Clients’ requirements taken fully into account – this process allows our advisor's to tailor-make a Portfolio to meet any specific and exacting need.

These key areas are:

Access and Flexibility – How liquid should the portfolio be from the outset and what access is required? Timescales Involved – Are there pertinent timescale parameters within which the Portfolio has to perform? Are there any target dates for encashment? Are there any key goals in the future that this Portfolio is linked towards?

Risk Profile – For us this is probably the most key point, how much risk is the Client prepared to take in order to meet their goals? Has the Client completed an Investor Profile Questionnaire? Does the Client fully understand the meaning of Risk?

Asset Classes – Ascertain whether Client wants any particular asset classes to be included in the Portfolio, are there any that they particularly want or do not want? Explain the differences between the asset classes in relation to risk.

Strategy – Given the time frames, risk profile, flexibility requirements and decided composition, discuss a strategy that suits the Clients needs and implement this strategy. Ensure the client understands the strategy and how it is being implemented in order to meet their needs.

Management – Decide through discussion what type of Investor the Client is and whether they wish to be ‘hands-on’ and actively manage this portfolio with the advisers, whether they wish to be ‘hands-off’ and allow the adviser to track the Portfolio or use a Discretionary Fund Management service.

All of the above six points are crucial when creating a Portfolio and our advisers cannot place enough emphasis in covering these points when helping to create a Portfolio. The key to making a Portfolio work, is reciprocal communication between Client and adviser at the outset, allowing the adviser to fully understand what is required by the Client and this enables the adviser to tailor-make a specific Portfolio to match the Clients’ needs.

Our advisor's will also gladly review any current Portfolio and offer impartial advice in the form of a Portfolio Appraisal.

By:- Ram Financial Consultancy
SriRam
Email Id: sriram.adviser@gmail.com
Phone : +919986128592