Say NO to these hot ULIPs

by Deepa Venkatraghvan

We won't be surprised if, over the next few days, a flurry of agents approach you to invest in Unit Linked Insurance Policies as if their life depended on it!

 

This is how their spiel would go: "Sir, this product will close for sale in 15 days. This is the last chance to benefit from it -- don't miss this opportunity, sir!" 

 

So saying, they produce some extraordinary numbers as returns. Those numbers shine like beacons in front of you. And you are tempted.

 

Pause. Step back.

 

Read this first: the Insurance Regulatory and Development Authority (IRDA)  banned  the sales of actuarially funded ULIPs on August 16.

 

IRDA said they were too complicated for the customer to understand.

 

Two companies that will be immediately affected by this ban are Bajaj Allianz Life and Aviva, with IRDA giving them until August 21 to shelve these products.

 

For you, this is a call for caution.

 

Typically, products that were closed for further sale were marketed very aggressively to customers before the closing date.

 

"This is a great opportunity for company agents to cash in," warns financial domain trainer PV Subramanyam.

 

Be an alert investor. Watch out for such dubious sales!