Skip to main content

LIC Online Term Plan

Download Tax Saving Mutual Fund Application Forms

Invest In Tax Saving Mutual Funds Online

Buy Gold Mutual Funds

Leave a missed Call on

94 8300 8300

 

 





Market leader LIC has finally launched its online term plan. The competitively priced policy could be a game changer for this fast-growing segment.

The launch of an online term plan by LIC could be a game changer for this segment of the industry. Find out if you should buy it. While the nation was engrossed in politics last week, LIC quietly triggered a mini revolution in life insurance. The state-owned life insurer launched an online term plan, which could prove to be a game changer for this fast-growing segment. The e-Term plan from LIC is about 35% cheaper than the LIC offline term plan, but slightly costlier than most online pure protection offerings from private companies.


However, given the tremendous brand equity of LIC, the e-Term plan is likely to become the preferred choice for most insurance buyers. Private insurance companies have received the news with mixed feelings. While many of them have gone into a huddle and refused to comment, others have hailed the LIC move as a positive step that will help grow the category. "We welcome LIC's foray into the online protection segment. This will help grow the online term plan market and enhance the awareness of customers.

 

Rau can afford to be optimistic about this new threat from the market leader. The Reliance Online Term Plan has the lowest premium compared with other online term plans for almost all ages (see table). Price is one of the biggest deciding factors in the online term category, with customers preferring to go with the price leader.

 

That's true, but only partly. A lot of buyers are also concerned about the pedigree of the company when they buy an insurance policy. For them, LIC is a household name that exudes confidence and trust. The state owned insurer has the highest claim settlement record in the industry, which gives it an edge over private companies. In 2012-13, the LIC paid out 97.73% of the claims it received.
Among private players, only five insurers, including ICICI Prudential Life, HDFC Life, SBI Life, Max Life and Kotak Life, reported a claim settlement ratio of over 90% during this period. Experts say that the insurers who have completed 10 years of operations ought to have a claim settlement record of over 90%. A high claim settlement ratio indicates that the company pays all genuine claims, which reduces the buyer's worry.

Others point out that the claim settlement ratio should not be seen in isolation. "While the claim ratio is a significant factor, there is no reason for the claim to be declined as long as the customer's declaration is correct

 

Another major concern that buyers have is that an online plan has exclusions hidden in the fine print. The incredibly low premiums charged by online term plans only add to these suspicions. A 30-year-old can buy a cover of `1 crore for as little as `7,000-8,000 a year. This has led many buyers to think there is a catch and the insurance company won't pay the claim.

This is a misconception. The premium of an online term plan is low because of two basic factors. One, there is no intermediary, so the agent's commission is passed on to the customer. More importantly, the online buyer is perceived as a low-risk customer by insurers. He is educated, earns reasonably well, is concerned about protection and is likely to have health insurance as well. In case of a medical emergency, he may be able to quickly reach a hospital and access specialised medical treatment. All these factors combine to lower the risk and, therefore, reduce the premium.


Premium quote is only indicative However, the premium quoted by an online calculator is only indicative and based on the assumption that you carry the normal risk in terms of health, family's medical history and occupation. When you submit your details online and pay the premium, the cover starts immediately, but is subject to medical tests and actuarial screening. If the tests show that you are suffering from a medical condition, have a family history of an ailment, or are exposed to a specific risk at work, the premium quoted is likely to rise.

 

Experts warn against furnishing incorrect information in the application just to bring down the premium. If you smoke or use tobacco in other forms, your premium will be roughly 25-30% higher than that of a non-smoker. If, however, you don't disclose crucial facts relating to your health, social habits and existing policies, it can jeopardise your insurance cover. If the insurer discovers that a policyholder concealed facts that affected the risk to his life, the claim will be rejected.
Most companies have medico-legal experts, who scan the claim documents for any attempt to mislead. Every year, about 4% of the claims received end up in the trash can.


Awareness about protection needs The past few years have witnessed a surge in sales of pure protection plans. While online term plans have become popular, their true potential is yet to be tapped. A joint study by Max Life Insurance and Nielsen reveals that four out of every five people who start the process to buy insurance online drop out before completing the purchase. The study does not say so, but one reason could be that

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

Invest Any Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Any Fund Application Forms

---------------------------------------------

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Franklin India Bluechip
      4. ICICI Prudential Top 100 Fund

B. Large and Midcap Funds Invest Online

      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
      4. Birla Sun Life Front Line Equity Fund
      5. Franklin India Prima

C. Mid and SmallCap Funds Invest Online

      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
      5. Birla Sun Life Dividend Yield Plus
      6. SBI Emerging Businesses Fund
      7. HDFC Mid-Cap Opportunities Fund
      8. ICICI Prudential Discovery Fund

D. Small and MicroCap Funds Invest Online

      1. DSP BlackRock MicroCap Fund

2.Franklin India Smaller Companies

E. Sector Funds Invest Online

      1. Reliance Banking Fund
      2. Reliance Banking Fund
      3. ICICI Prudential Banking and Financial Services Fund

F. Tax Saver Mutual Funds Invest Online

1. ICICI Prudential Tax Plan

2. HDFC Taxsaver

      1. DSP BlackRock Tax Saver Fund
      2. Reliance Tax Saver (ELSS) Fund

G. Gold Mutual Funds Invest Online

      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund
      4. 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

Popular posts from this blog

All about "Derivatives"

What are derivatives? Derivatives are financial instruments, which as the name suggests, derive their value from another asset — called the underlying. What are the typical underlying assets? Any asset, whose price is dynamic, probably has a derivative contract today. The most popular ones being stocks, indices, precious metals, commodities, agro products, currencies, etc. Why were they invented? In an increasingly dynamic world, prices of virtually all assets keep changing, thereby exposing participants to price risks. Hence, derivatives were invented to negate these price fluctuations. For example, a wheat farmer expects to sell his crop at the current price of Rs 10/kg and make profits of Rs 2/kg. But, by the time his crop is ready, the price of wheat may have gone down to Rs 5/kg, making him sell his crop at a loss of Rs 3/kg. In order to avoid this, he may enter into a forward contract, agreeing to sell wheat at Rs 10/ kg, right at the outset. So, even if the price of wheat falls ...
Read more

Mutual Fund MIPs can give better returns than Post Office MIS

Post Office MIS vs  Mutual Fund MIPs   Post office Monthly Income Scheme has for long been a favourite with investors who want regular monthly income from their investments. They offer risk free 8.5% returns and are especially preferred by conservative investors, like retirees who need regular monthly income from their investments. However, top performing mutual fund monthly income plans (MIPs) have beaten Post Office Monthly Income Scheme (MIS), in terms of annualized returns over the last 5 years, by investing a small part of the corpus in equities which can give higher returns than fixed income investments. The value proposition of the mutual fund aggressive MIPs is that, the interest from debt investment is supplemented by an additional boost to equity returns. Please see the chart below for five year annualized returns from Post office MIS and top performing mutual fund MIPs, monthly d...
Read more

Mutual Fund Review: SBI Bluechip Fund

Given SBI Bluechip Fund's past performance and shrinking asset base, the fund has neither been able to hold back its investors nor enthuse new ones   LAUNCHED at the peak of the bull-run in January 2006, SBI Bluechip was able to attract many investors given the fact that it hails from the well-known fund house. However, the fund so far has not been able to live up to the expectation of investors. This was quite evident by its shrinking asset under management. The scheme is today left with only a third of its original asset size of Rs 3,000 crore. PERFORMANCE: The fund has plunged in ET Quarterly MF rating as well. From its earlier spot in the silver category in June 2009 quarter, the fund now stands in the last cadre, Lead.    Benchmarked to the BSE 100, the fund has outperformed neither the benchmark nor the major market indices including the Sensex and the Nifty. In its first year, the fund posted 17% return, which appears meager when compared with the 40% gain in the BSE 1...
Read more

IIFL NCDs

Buy Gold Mutual Funds Invest Mutual Funds Online Download Tax Saving Mutual Fund Application Forms Call 0 94 8300 8300 (India) IIFL NCDs IIF's six-year unsecured NCD 2012 Risk-wary investors should stay away from this issue, and even, risk-taking ones should think twice It is a public issue of unsecured redeemable non-convertible debentures ( NCDs ) by India Infoline Finance ( IIF ), an unlisted company, which is a 98.9 per cent subsidiary of India Infoline, a listed company. The issue seeks to raise Rs 250 crore with an option to retain over-subscription up to Rs 250 crore taking the total potential issue amount to Rs 500 crore. It will be open for public subscription from September 5 to September 18 with a minimum application size of Rs 5,000 in the form of five NCDs of face value Rs 1,000, TENURE & RATES: IIF will redeem the NCDs at the end of six years, and investors wanting out before six years will be able to sell the...
Read more

Principal Emerging Bluechip

In its near ten year history, this fund has managed to consistently beat its benchmark by huge margins The primary aim of Principal Emerging Bluechip fund is to achieve long term capital appreciation by investing in equity and related instruments of mid and small-cap companies. In its near ten year history, this fund has managed to consistently beat its benchmark by huge margins. This fund defined the mid-cap universe as stocks with the market capitalisation that falls within the range of the Nifty Midcap Index. But, it can pick stocks from outside this index and also into IPOs where the market capitalisation falls into this range. Principal Emerging Bluechip fund's portfolio is well diversified in up to 70 stocks, which has aided in its performance over different market cycles. On analysing its portfolio, the investments are in quality companies that meet its investment criteria with a growth-style approach. Not a very big-sized fund, it has all the necessary traits to invest with...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now