Answer
Dear Ravindra,
I understand your concern, but please understand that there is no method of trasferring one insurer to another. You would have to close the present plan with Company X and then purchase a fresh plan with Company Y. But why are you evaluating so soon?
However, ULIPs are typically Long Term products and so would be the Plan that you have taken. The performance cannot be monitored in such a short time as it should only be evaluated in a period of 10-15 years and not before that.
Thus, you will be able to receive good and comparable returns only if you invest in it for long term and continue to pay premiums for the same for a minimum of 10-15 years. However, if you choose to compare the returns before that horizon, it will surely not give good returns as the cost of Insurance, especially ULIPs, are very high in the initial days. Thus, 3 -4 years is definitely too low a horizon to compare ULIPs
These products are usually front loaded and hence most charges are charged in the initial days of policy tenure. The policy give good returns only after the charges even out after the 5th to the 7th year, depending on the policy schedule.
So, it would be best if you continue the plans till the end and continue paying the premiums if you want good returns from the same, because ULIPs are definitely not a 3 or 5 year product.
Similarly this product that you have is a long term plan and should only be evaluated in the long run. Thus, whether this product will eventually give good returns or not is very difficult to say at this junction but underlying risk is there in all types of investment tools, even debt ones. The level of risk varies from product to product.
If you still have any queries, please feel free to get back to me on the same. All the best!
- Answered By: MIC Expert
- On: 7th Jun 2012 2:01 PM
