{"id":56,"date":"2018-08-16T11:35:20","date_gmt":"2018-08-16T11:35:20","guid":{"rendered":"http:\/\/blog.insurancesamadhan.com\/?p=56"},"modified":"2020-09-23T05:36:05","modified_gmt":"2020-09-23T05:36:05","slug":"did-you-buy-a-single-premium-policy-as-fixed-deposit","status":"publish","type":"post","link":"http:\/\/www.insurancesamadhan.com\/blog\/did-you-buy-a-single-premium-policy-as-fixed-deposit\/","title":{"rendered":"Did You Buy a Single Premium Policy as Fixed Deposit ?"},"content":{"rendered":"\n<p>Ramesh wanted to renew his FD and visited his bank. At the bank, he was sold a policy with promises of superior features than fixed deposit. Ramesh was sold with features as below:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>You will have a better return than fixed deposit<\/li><li>Return will be tax-free whereas FD returns are taxable<\/li><li>You will also have risk cover<\/li><\/ul>\n\n\n\n<p>However, Ramesh was not told the following:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Returns are not guaranteed and would depend on the market or on the performance of the Insurance company<\/li><li>Returns can be tax-free only if the life cover is more than 10 times of premium paid. But the option of 10 times cover would impact the returns.<\/li><li>Mostly all single premium policies offer 1.25 times of premium paid. Thus proceeds also become taxable<\/li><li>Capital in fixed deposit is liquid and can be withdrawn.<\/li><li>The minimum tenure of a single premium is 10 years. Early surrender would have a cost.<\/li><\/ul>\n\n\n\n<p><center><a href=\"https:\/\/www.insurancesamadhan.com\/register?utm_source=google&#038;utm_medium=organic&#038;utm_campaign=blog_banner&#038;utm_content=http%3A%2F%2Fbit.ly%2F2kuc159\"\/><img decoding=\"async\" src=\"https:\/\/www.insurancesamadhan.com\/assets\/img\/contact.png\" alt=\"Get Resolutions for Insurance Complaints\" data-pagespeed-url-hash=\"3942394488\" onload=\"pagespeed.CriticalImages.checkImageForCriticality(this);\"\/><\/a><\/center><\/p>\n\n\n\n<p>Why Ramesh was sold an Insurance? The obvious answer lies in the commission to the seller. If Ramesh is unlucky then a regular premium policy is sold as a single premium. This is done because the regular premium policy has a higher commission than the commission on a single premium.<\/p>\n\n\n\n<p>In such a case, a reference is given to the IRDA ruling that the first-year premium is refunded after 5 years. However, the client is not told about the charges and a minimal return promised. When the client does not pay the second year premium then the money is taken in a surrendered fund with a minimal return of 4 %.<\/p>\n\n\n\n<p><strong>It is better to opt for Mutual Fund in place of a Fixed Deposit<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Ramesh wanted to renew his FD and visited his bank. At the bank, he was sold a policy with promises of superior features than fixed deposit. Ramesh was sold with features as below: You will have a better return than&hellip; <a href=\"http:\/\/www.insurancesamadhan.com\/blog\/did-you-buy-a-single-premium-policy-as-fixed-deposit\/\" class=\"more-link\">Continue Reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":4,"featured_media":63,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","footnotes":""},"categories":[1],"tags":[],"class_list":["post-56","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.8 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Things to know while buying single premium insurance<\/title>\n<meta name=\"description\" content=\"Know about the things which are not conveyed while buying single premium insurance as a fixed deposit.\" \/>\n<meta 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At the bank, he was sold a policy with promises of superior features than fixed deposit. Ramesh was sold with features as below: You will have a better return than&hellip; Continue Reading &rarr;","amp_enabled":true,"_links":{"self":[{"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/posts\/56","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/comments?post=56"}],"version-history":[{"count":1,"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/posts\/56\/revisions"}],"predecessor-version":[{"id":64,"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/posts\/56\/revisions\/64"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/media\/63"}],"wp:attachment":[{"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/media?parent=56"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/categories?post=56"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.insurancesamadhan.com\/blog\/wp-json\/wp\/v2\/tags?post=56"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}