From a full-page advertisement in today’s edition of Bangalore Mirror:
Bharti AXA Life Insurance presents a unit-linked insurance plan that guarantees you return of your first year premium of up to 175% at maturity and invests up to 100% of all your subsequent premiums.
What kind of financial misguidance is that? Incredible. I am being guaranteed the return of my first year premium at maturity! Way to go Bharti AXA — you just set the benchmark for financial suckiness (a measure of how much a financial product sucks). And in case you didn’t notice, up to 175% actually means anywhere from 0% to 175%; no guarantees on what that final figure will actually be.
A classic “WTF mate?” product. And don’t forget: Unit-Linked Insurance Plans (ULIPs) are akin to playing Diwali with your hard earned cash.
I would like supplement on this. The funniest thing in this policy is that on the brochure they mention is your premiums getting vanished. But what these Bharti people are doing is in the name of givin 175% of first premium return after maturity/death they are not allocating the first year premium into the funds. That means firs year prem allocation charges are 100%. At the end of the tenure they will give peanuts of first premium.