What to do with Reliance Health Insurance??

One Reader Mr.S wrote  "I am regularly paying annual premium in Reliance Health + Wealth  plan for the last four years. The fund value at present is equal to the premium paid. The lock-in period of 3 years is over. I am getting income tax benefit with this plan. Please advice me which is better-- to pay further premiums or withdraw partially and invest in MFs? My family did not have any hospital benefit claims till date from this policy."

SRIKANTH SHANKAR MATRUBAI REPLIED  :

This policy is a combo of usual mediclaim policy & ULIP. This Policy combines health insurance with investment and pay back an amount at the end of the insurance term. The returns of course are dependent on market performance.

Being a ULIP the charges are pretty high.

The Fund Value would depend on the performance of the investments made by the fund. please remember that the fund charges here in this fund are different and hence, a combination of simple Mediclaim policy and Mutual Funds would be a definite winning combination

Just investing for sake of Income Tax benefit is a wrong idea.

And moreover, you will not get very little profit out of it, you have already completed locking period of three years, so  better you come out of this and seriously consider investing for long term in MUTUAL FUNDS, you will get much better profit out of your investment.

It is always advisable to go for a Pure Health Insurance Cover and a Term Plan.

For returns, mutual funds are the BEST alternative.

WHAT TO DO NOW??

1. Ensure you have a cost effective Term Insurance Plan.

2. Surrender this ULIP, and invest into good MFs for the purpose of long term investments.

The same effect of mediclaim & saving can be achieved by purchasing a cheaper mediclaim policy as well as investing the surplus amount as per our comfort level in Eq. or Debt funds or anywhere else. So this policy should be avoided by Short Term and Medium Term Investors.

Only very long term investors who are salaried people can look at this policy and that too in Moderation. They can also have a serious look at ICICI HEALTH SAVER which is more or less similar.

My choice for Health Insurance would be a toss up between Max Bupa Heartbeat and Apollo Munich Optima Restore.

For Term Plan, the choice would between Kotak Preferred Term Plan and Birla Protector Plus.

For mutual fund investments, Visit http://goodfundsadvisor.blogspot.com

A small story

Two People (Jeevan and Anand) working in a software company were traveling from Mumbai to Pune. They were getting late for their annual meeting and so they were rushing at top speed. They got on the express way and suddenly lost control resulting in an accident. Both of them died on the spot.

Jeevan and Anand both go to heaven and realize that now instead of getting late we are now Late Jeevan and Late Anand. After a few days they saw their families from the heaven. Anand had term insurance in place and so his family was taken care off on the other side Jeevan, while he was alive bought a few endowment and money back plans from his insurance advisor. His family was struggling.

On seeing this they requested god to give them one chance to meet their insurance agent. This was against the rules of heaven but still they were allowed.

They both sat in front of their respective agents and said the following:

Jeevan said:

Why you did not educate me about Term Plan?
Why did you sell me all the money back plans and kept me under insured?
Tell me now, who will take care of my family?
I have a request please only sell proper term plans to people and see that they are covered properly.

On the other side Anand was in a safe spot. He had his insurance in place still he wanted to meet his agent.

Anand with tears in his eyes gives a hug to his advisor and says:

Thank you my friend (advisor) for selling me Term plan
You really educated me on insurance and helped me buy the right cover.
Share our story with as many people you can and keep up the good work that you are doing.

They got a chance but in reality if something goes wrong you won’t get one.

Insurance companies never use the word Term Plan in any of their advertisements and so many people don’t know what Term Plan is. A lot of people are still thinking on buying a term plan. They are still not able to decide whether they should buy online or offline term plan. This story is an eye opener, many people who died at an early age would like each one of us to have proper life cover. And if you know about term plan please help people around you to have proper cover.

Thanks to my friend, Mr.Moolchand, who sent me this....

A real eye opener to novices.

KOTAK CLAIM SETTLEMENT @ 97 %..

Hi,
Kotak Life Insurance recently revealed that its Claim settlement is as high as 97%.....

 

 

Kotak Life Insurance  is nearing
completion of 11 years of business and we all know that
settlement of claims is a good yardstick to measure our business
philosophy. 

Kotak recently sent this mail to me...and it goes like this...

We are all aware of KLI Claims Department’s philosophy
- “WE ARE IN THIS BUSINESS TO SETTLE CLAIMS”
and we ensure that we give our best to the customers approaching us
trusting that we will fairly settle all their claims.  We are always
there when the families need us the most.  We ensure
that we don’t create unwanted hurdles to the families of the deceased,
who are already in pain and sorrow.  Hence, our Claims Department runs
with the branding of “Claims Mitra”.

To share Claims facts
and figures w.r.t. our Death and Critical Illness claims, as is done
every quarter:

 

 
   
     
     
     
   
   
     
     
     
   
   
     
     
     
   
   
     
     
     
   
   
     
     
     
   
   
     
     
     
   
   
     
     
     
   
 

Financial Year	2010-11	2011-12 H.Y. ended 30.09.2011
	No. of Claims	No. of Claims
Claims O/S at the beginning of the period	298	375
Claims reported during the period	5,128	3,382
Claims Settled during the period	4,894	3,300
Claims Repudiated during the period	157	109
Claims O/S at End of the period	375	348

 

During the Financial
Year 2010-11, we received over 5000 claims - 50% increase over 2009-10.
In 2010-11, we have paid over 4900 claims- which is 54% more claims
paid over 2009-10. In F.Y. 2010 -11, we paid over
Rs.105 crores.

 

You would be happy to
know that your Claims Department has maintained this trend this year as
well by paying 3,300 claims worth around Rs. 55 crores
already in the first six months of 2011-12.
We have totally paid over 15,750 claims amounting to over Rs.
350
croresfrom inception, which means around
half of our total claims paid in 10 years have been paid out in the
last 18 months itself. This shows that as our
Company grows and claims increase, our claim servicing is matching with
the pace and doing justice to our customers and families.

 

While
stating
this,
you would also be happy to know that our repudiation
ratio has been just around 3%, which means that 97% of claims are
settled - which is surely a great news for our customers.

 

I am also happy to mention here that currently over 95%
of our claims are being paid within 7 Days and
around 99% within 10 Days from
receipt of all documents. As on today, we have just
36 claims over 90 days which are pending to be processed.

I would also like to make a small mention over here that right
from the beginning, we have a separate fast track claims process in
place to ensure that we pay all natural calamity claims or unexpected
major event claims, for eg., Mumbai floods, Bomb Blasts,
Tsunami, Earthquake etc. within max. 2-3 days’ time so that our
customers do not have to face any sort of difficulties in addition to
the difficult times already faced by them during such disheartening and
painful events.

 

Just for the records, I
would also like to highlight that we have paid largest claim of ` 15.80 crores
on single life within 11 days from the
date of intimation. This is the largest single claim paid till date for
KLI and surely amongst the highest in the industry as well. Payment of
such a large claim in a short duration of time again shows our
commitment towards our operating philosophy.

 

I am sure that this
information shall help our clients – existing as well as prospective,
to assess Kotak Life Insurance from claims servicing perspective .