Most important questions you should ask a ULIP agent

POSTED BY Jagoinvestor ON May 28, 2009 COMMENTS (273)

When an agent approaches you with ULIP product; before filling up forms, he should be explaining you What is a ULIP and how it works! You should ask him the following 6 questions to make sure you know what you are about to buy!


1. What are the returns offered by this ULIP?

As per the rules of IRDA, an agent should explain you the workings of ULIP with an assumptive illustration earning 6-10% returns. However, if he claims that in the long term the policy is expected to give more than 10% then this information is not misleading.

But if he claims that the policy ‘WILL’ earn 18-20% or even Million% returns, you need to stay away from such agents!

2. What are the Charges applicable in this ULIP?

He should give you detailed Information on all the charges that are/will be applicable to ULIP. The important charge you need to know is Premium Allocation Charges.

If he doesn’t disclose any Charge that is applicable  then I am sure its not because of his dishonesty and no other reason. Ask him the company brochure mentioning the exact charges where all the charges are listed and explained in detail.

3. How does it suit my Risk Profile and fit in my requirement?

Before suggesting you the ULIP the agent should have asked you all the details about your Cash flow (Salary, Expenses) and your future goals with ULIP investment should be addressed.

He should also try to understand if you can take the risks associated with the ULIP. If he does not ask you these things then you ask him back why he has not asked you these questions. Get the word out of his throat!

4. How is it better than other ULIPS?

Ask him what is unique with the ULIPs he is recommending to you and make sure he does start all non-sense of Sec 80C benefit and high returns and all… Every ULIP has it! Ask him what are the special features with ULIP and how do they address your requirements.

If he claims that his company ULIP is the best and no other ULIP can match it then ask him for references if any states that. Just a plain claim from agents will not do. An agent must have enough knowledge to make you understand how to make best use of your ULIPS.

5. How does it score over Term Insurance + Mutual funds combination?

ULIPS are combination of Insurance and Investment produce, There is no point in taking it, if it cant perform better than Term Insurance + Mutual funds SIP. Switch benefits in ULIPS are the main benefit in ULIPS.

He must put pressure on that point, If not he is him self not aware of it. Refrain from taking the policy if he starts claiming that returns from ULIPS will be much higher than Mutual funds.

6. What was the performance during Market Crash?

Agents generally try to put up rosy picture and hence refrain from disclosing the funds performance in bad markets. If the fund has done bad, that is acceptable. Its investor responsibility to take care of switching and asset allocation.

So there is nothing wrong in performing bad in bad markets. Agents will first try to avoid the confrontation, but finally may tell you that they did bad and returns are very low. Ask him for exact number in return and try to find out how other ULIPS performed.

My personal Experiences

I have never come across any ULIP agent who has tried to sell the product in a professional manner. This has its own reasons like meeting Sales Target pressure or poor training to Agents. Anyways ,its not acceptable and can not be accepted . For so many years, Mis-selling is happening in India.

Conclusion :

Your hard earned money should go in proper investments. There should not be hurry in taking action. So don’t feel shy in asking questions once or twice or thrice, understand the product and its suitability with your requirement.

No product is good or bad, its only bad or good depending on your requirements. So be informed Investor and don’t fall prey to Idiotic agents.

Don’t do mistakes that are already done by tons of investors who took ULIPs for 3 years.

– To save tax
– Make exceptional returns from Stock markets
– Make them self believe its a happening product because it looks so complex

Please share with me if you have taken ULIP for wrong reasons
– Do you think that ULIPS will have any success in future… I feel yes

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273 replies on this article “Most important questions you should ask a ULIP agent”

  1. Sanjay says:

    Hi Manish Ji,
    I had taken a ulip ‘New Unit Gain Plus’ from Bajaj Allianze with 15,000/- as annual premium for 10 years and I had deposited 6 times i.e. Rs. 90,000/- against this, then stopped to deposit balance premium as advised by the Agent. Now Policy has been matured in last month (28th Aug’16), but fund value shown is zero, but while I watched one week before from the maturity it shows approx. 1.69 L, why suddenly, it become zero. I couldn’t understand the meaning of ‘Withdrawal charges RP’ , Against this caption – ve value has been shown (-1.69 L). You are requested to kindly suggest me what can I do further to receive money from the company or it may not be possible to get any returns.

    1. You might want to check with them only on this.

  2. CHETAN says:

    Hi manish is bajaj future gain plan good

  3. Prasanta says:

    Hi Manish,

    I have taken a Bajaj Allianz Future gain ULIP policy for 20 years, currently I am 31 years pld & monthly I will be paying 3500. Policy is having 5 years lock in period & allocation charge 1.5% for 5 years apart from other charges as usual. I have 30 days of time to confirm. But after reading all the reviews & all I am not completely convinced. Below are the fund details. Please suggest.



    1. Prasanta says:

      Can anyone please suggest on my above query?

  4. Swapnil says:

    Is it better than a Fixed deposit? Will it get me more interest than that for 5 years. I do not have an option now. I just read about it after taking it. Thanks for your advice

    1. It might give you if the markets perform well. But you should ask if it will give you more than the best option you could have got ! . If FD is your benchmark, then you might be happy , but thats not the right way !

  5. Swapnil says:

    Hi Manish,
    I have opted for HDFC Life ProGrowth Plus plan with annual payment of 60k. Currently my age is 27. I am planning to stay invested for 5years. What is your recommendation on this? Actually I had gone to make a tax saving FD but this was suggested to me. But after reading here now I am worried. Please share your valuable advice.

    1. Its not a great option ! … Why have you invested first and then researching now ?

  6. Shalini says:

    hi Manish,

    I am interested in investing in SBI elite Gold single premium Bond Fund insurance with an annual single annual premium of Rs 2,00,000 for 5 years. Is that a good investment and what are the expected returns after 10 years.

    1. I dont think its a good idea. Mutual funds would be a much better choice.

      Please fill in your details here if you want support of our team –


  7. Abhishek says:

    Manish , I have already taken ELSS plan of 3.5k/month in Axis long term equity and now want to take ULIP plan for more tax saving as well as insurance so please suggest me either should i invest more money in ELSS or ULIP plan for best return??? plz suggest

    1. You should invest in ELSS only, not ULIP

  8. Mahesh says:

    Hi Manish,

    Today I have invested 30k in HDFC Life Click2Invest ULIP. I have no idea about investments before. As the agent from policy bazaar suggest this ULIP plan is best compared to MF with 20% returns. But after reading all the articles from internet I’m in confusion now, I have chance to cancel that as it is not completed fully. So please suggest me weather it is best to invest or should I go for other like ELSS. And please suggest me some best investment plans

    1. Better cancel that policy and start your mutual funds investments.

      My team can help you full on this, if you can fill up this form


  9. pathanjali says:

    HI Manish,

    I started invested in SBI wealth builder for 1lakh per annum. Policy period is 20 years and premium payment term is 5 years. I want to get good returns. money is invested in 50 % bond fund. and 50% equities. Is this a good idea?

  10. Sakthi says:


    Dear Manish, j
    I have bought Hdfc click2invest plan , almost month ago(single premium of INR 40000). I have paid the premium But IT IS NOT YET ISSUED, due to some pending formalities. After reading all the above review, now I’m confused about my decision. I choose to invest for tax benefit, (as advised by agent). But after research I have realised, tax benefit is extremely low for single premium (jus10% of sum assured). KINDLY suggest, what should I do”? 1) Shall I continue with it? 2) Or may I cancel it? (3) If I cancel, what will be the charges ? as my policy is not yet started and it does not have any fund value. Will they give me my full premium amount.? Or they will apply heavy cancellation charges.? Any idea how much cancellation will cost to me? Thanks in advance. Kindly provide UR reply soon, as Hdfc is chasing me for pending formalities.

    1. HDFC Click2invest is ULIP, but its a good ulip as its a lower cost one. Still if you want to cancel it , you can do so without charges as you have not got it issued till now

  11. Mayank says: