PRODUCT REVIEW

POSTED BY Jig ON January 16, 2011 1:39 am COMMENTS (13)

Hello all experts

Here i am attaching one product and need help from you guys on that. Its Urgent as my fren already signed this product and he has few days only to return it back. I wana help him and protect him to buy the product difficult to understand. Please help…..

https://spreadsheets.google.com/ccc?key=0AvC-G_eD-LvodGZ2ODd0RXdKYmVDc3psa09meEhPNnc&hl=en

 My intention was to get 50 lac SA with giving 5 premium only

TATA aig offerd me a unique plan with one time investment of 5 lac. they will deduct from it yearly 33000 as base premium and on remaining amount they will give 7 % interest just like FD till 5 lac invested ( said 15 years)

I am getting 56 lac SA

Additionally from very next year i will be getting  21780 for 2 years and thereafter 43560 for whole life. i can take loan upto 30 lac from this insurer too.

I am confused as how i can compare this with term+MF senario and which will be beneficial.

please provide your 2 cents on this.

Thanks & Regards

13 replies on this article “PRODUCT REVIEW”

  1. jignesh says:

    Ohh God,
    Finally it is true wat you guys was expected. it was fishy..and my friend already cancelled the policy after communicated to the company main branch.
    These agents are really ***** upto the level that he done a duplicate sign in some of the papers of the policy.

    Still cheque has not been receieved but it is on the way as per the company.

    Thanks to all for providing your valuable time.

    this forum really meant to me & i really saved my friend to be in dip trouble.

    Regards

  2. jignesh says:

    Manish,
    Yeah i have gone through it earlier and know about this 6 Year and 10 Year return mentioned in that. Some time agents customize ( As LIC agents are doing to pay premium of one policy by return of another and etc )

    Thanks for your input dear.

    Regards

  3. jignesh says:

    Hello All,
    Thanks for all your input.
    Ashal, I have gone throuh this broucher and yep i read all those details. As my frd is saying that plan is customized and that the reason he has asked to wait for 45 days till TATA will get approval for that custumization. ( Yep this is look odd to me too).

    For all of you to remind that this is One time payment of 5 Lac as i have mentioned in very first question.
    Now how they are gonna give this return that i don know.
    Still i didnt receive any feedback from TATA AIG.

    thanks once again

    1. Jignesh

      You didnt go through details before asking the views ? Didnt you have brochure that time ?

      Note that customized plan does not mean they have made any big changes .. just that the agent has put your name and address and generated a 2 page report with a software and gave you all numbers as per your convinience , thats their “customized for you” plan ..

      Manish

  4. ASHAL JAUHARI says:

    Dear Jignesh, there is more to add in the above reply, I tried to calculate prem. for the example data, but interestingly, prem. calculator is not opening in IE, Google Chrome or Firefox.

    I don’t know it’s a genuine problem or is there something fishy?

    Thanks

    Ashal

  5. ASHAL JAUHARI says:

    Dear Jignesh, I think the policy in question is this one –

    http://www.tata-aig-life.com/life-needs/retirement-plans/mahalife-gold.html

    While going thru the sheet & later on checking the above link on TATA-AIG website, I feel the agent is making a fool of your friend.

    It’s clearly given in the link posted by me that guaranteed payouts ‘ll start only after completion of 10 policy years & all past prem. are paid. Again this 5% of basic sum assured guaranteed pay outs are annualized one which come out some 23458 Rs. mly for the example sum assured of 56.3L Rs. in your sheet.
    Read clear ly that from 6 policy year onwards, the non guaranteed cash dividends ‘ll be paid.

    So I’m unable to understand from where that agent is quoting these guaranteed figures of 43560 Rs. & that too after 4 policy years only.

    In my view, ask your friend to skip this policy completely if prem. is not paid already. In case the prem. payment has been done, surrender the policy under the initial 15D free look in period.

    Thanks

    Ashal

  6. shashank kashettiwar says:

    @ Jignesh,
    Your friend is being fooled by a very ‘chalu’ type salesman/men. That 45 days period is specifically stated by them so that one should wait and the 15 days freelook is over. I have heard similar type cases.

    By the way, what is the name of the plan? That excel sheet you have shown cannot be the actual illustration. It is simply too good to be true!

    shashank

  7. Jignesh/ramesh

    If you do some IRR analysis , I can see that with the facts and figures given by jignesh, the IRR turns out to be 7.34% , does not matter if you get that 43560 for 50 yrs or 500 yrs, the IRR will be almost same .

    However the main point is the data provided here , because I strongly doubt it ! . the main or the real thing might turn out to be much different .

    I would recommend having everything on the paper and then if its true , this plan might look ok to me provided the pension coming out from this product looks very good in debt category . Its a different matter than using other means one can generate a much better pension (with risk) .

    Manish

    1. jignesh says:

      Manish,
      Exactly same thing i have told my frd that get on TATA AIG STAMP PAPER and get those thing in written that you have free look period of 45 days till the policy structure is approved by IRDA. so later on you can prove while submitting after 15 days free look period.
      Well this is the data all i get and it is prepared by TATA AIG AGENT only.
      This is the re structured plan of TATA AIG MAHA GOLD PENSION PLAN.
      Company agent is also telling is minimum 7.2% you will get . i dont know how to calculate IRR and wat is that .

      well i have directly approached that agent for getting the facts.

      i ll update once i ll get reply on this.

      thanks all bro to help.

  8. jignesh says:

    Well Ramesh,

    I am too surprised as that the reason i put this plan here to know from experts.

    This is a guranteed amount and its not ULIP. Its a endowment plan. Its under approval of IRDA as differ from actual broucher. as per insurer my frend will recieve the approved letter within 45 days of signing the policy.

    OK, suppose they give in written in letter that its a guaranteed amount , should we go ahead with this?

    thanks for your view on this
    Regards

    1. Ramesh says:

      Do you mean to say that the actual policy is different from what the on-site brochure is telling? With that much difference?

      LOL. Afaik, an insurer cannot issue a policy which does not have necessary approval from IRDA. if it issues a policy without prior approval, it is a fraud.
      Moreover, 15/31 days is the time for free-look period and they will get an approval in 45 days.

      Why not wait for the final approval and only then invest, so return now and invest later after the approval? That is a safe alternative!! What do you say?

      I would not invest in such a policy ever. Even the govt only gives you a 8% guarantee. How come a pvt institution give you 66%?

  9. Ramesh says:

    Do you think these returns are guaranteed?
    Comb through the policy documents. 😉

    Bonuses are different from cash values.

    Do you really think that a plan through which you invest 33k every year, will start giving you 21,780 (=66%) return without investing in equity markets, with guarantee,and with provision of tax benefits?

    Citibank fraud was related to 15-20% guaranteed return (more than double the FD rates), and you think you will get 66% return.

    If you want a decent enough life cover using less premia, use single premium term life policy. Eg. kotak preferred term plan will give a 30 year male non-smoker, a cover of 50lakhs for 25 years for single premium of about 98k.

    As I know, Tata Mahalife is a traditional insurance product and the rate of return which you can get is 5-6% over a long period.
    Yes, it gives you a guaranteed life cover for whole life and a guaranteed annual income from 10th year onwards till the age of 100 years. Remember, only the income is guaranteed not the AMOUNT. They will pay 5% of sum assured guaranteed from 10th year and the an extra cash value, the amount of which is not guaranteed and depends upon the performance of the company.

    The taxation benefits are applicable to current laws. Remember, min 20x is required for a life insurance policy to continue having tax benefits as per DTC till now (can change in the future).

    Hope this gives you a proper picture. Keeping it or not is a personal choice!

    Ramesh

  10. jignesh says:

    Manish
    can you please provide your comment on this. This is really urgent and i don want my fren to be in wrong product if it is so.

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