View Full Version : The Insurance Mistake- Postal Life Insurance

06-12-2014, 03:58 PM

I am writing this topic on the basis of my own experience regarding insurance mistake. a lot of us blindly buy Postal Life Insurance Policies without weighing its utility just because its sold by Post offices. I am too one of them and regretting my mistake now after getting myself fixed in this trouble for rest of my life.

I have bought 04 PLI Policies of Endowment Assurance(Santosh) in 2010 in parts i.e. 2 lac for the age of 45, 6 lac for the age of 50 and more 2 lac for the age of 60. So in total i have insured myself for 10 lacs at a high premium of Rs 47000/- per year. Post office agent talk about high bonuses on this policies and show you a chart of maturity value in lacs, IT exemption etc. which tempts you to buy this product. But why its a mistake?

Let me tell you now:
1. Bonus is not fixed and it may go down drastically depending upon the acturial valuation of PLI fund. You can see the downward bonus trend in last 2-3 years.
2. Now the most important part i.e. surrender. When you surrender this policy after 3 years, you may get a heart attack due to heavy loss. But even after surrendering it after 5 years when you also get the bonus, surrender value is not so good.

Let me put calculation here:

I have paid around 2.35 lac in last 5 years. Now if I surrender today, I may get around 1.65 lac(70 k less) or may be even less(only around 50% of what i paid) even though with bonus means I have paid 14k per year for insurance of 10 lac. While one can get same amount of term insurance for just Rs. 1200 per year.

So I have bought something for 14k which is actually worth only 1.2k per year. In addition you face all the nonsense of poor services by Post offices across the country. The way surrender value is calculated is ridiculous and worst in whole insurance industry. Actually its loot of hard earned money of unaware govt. employees, who think that just because govt. is involved it must be good.

I have learnt this lesson after incurring heavy loss. So my advise to all the friends here is:
1. Never mix insurance with investment.
2. Buy only term insurance policies. Insurance is meant for safeguarding your family after you and not meant for investing money.
3. Always check claim settlement ratio of the company before buying any term policy.
4. Do insure yourself for the sake of your family.
5. Never buy a Postal Life Insurance.

21-02-2015, 03:31 PM
thanx for the information provided.

Gopal Krishan
22-02-2015, 01:53 PM
My thanks too.
Gopal Krishan

20-08-2016, 07:31 PM
absolutely correct. do not mix insurance and investment. but most of us do it.

08-03-2017, 03:31 PM
I am 39. I need to plan for a handsome amount (Around Rs. 10-12 lacs) for his education.
I have examined the PLI in following aspects:

For a sum assured of Rs. 10 lacs
i need to pay around Rs. 8000+ p.m.
Apart for usual benefit of tax exemption, it is likely to give me a maturity of around 16 lacs after 11 years i.e. maturity at age of 50, (when i shall require it)

in this fashion the outgo (premia) is : Rs. 8000x12x11 years = 1056000

Is there any better advise that can offer me comparable return for same investment.



23-03-2017, 07:54 PM
yes.pli is very good...why?

it is very less ,if you start at your younger age,safe,reliable,do not surrender, as your salary goes up get new pli, and it is a ,and only the good thing you are doing for your wife/husband,and to the kids....expences on exam, marriage, and so on

yes, if you surender, it is nothing,

but at the end of your age 58, the rice may be 200 per kg, at that time, this pli maturity value will be nothing, yes , so get a new one ,as soon as you get a da

please get some insurance data from the private agencies, enquire, compare, and see the difference , how pli is so small amount,,,