This letter was published in Financial Chronicle on November 19, 2008
POOR STRATEGY
This refers to the news “Ulips to have uniform fee structure” on November 13.
Competition from peers and mutual funds as well as relentless media bashing has led the life insurance companies to reduce the exorbitant commissions paid to their agents. Ulips is a good concept but badly sold by agents.
As Ulips have higher commission structure, agents do not disclose the pitfalls of premature withdrawal and equity exposure limits.
With this issue resolved to some extent, investors will be able to compare various products and then decide.
Srikanth Matrubai,
Bangalore
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