Two years back, I purchased Flexi Cash Flow Money Back Plan from Birla Sun life. They were selling it through Citibank. The advisor from Citibank was very suave and told me all the benefits of a unit linked policy and showed me illustrations predicting returns of 15 - 18%. She did not speak about any fees or charges and I assumed (my biggest mistake!) that there would be none or minimal...
Later on when I paid the premium and checked how many units I had got, the number was far less than I had anticipated. When I contacted them, this is what I got in response:
First year loading fee is 65%. (can you believe, 65%)
For second and third year, it is 7.5% and afterwards it is 5%.
Apart from these, there is annual insurance chargs Rs 1.16 per thousand face amount (life cover amount).
An investment management fee of 1% per annum
policy administration fees of Rs 22 per month
Annual charge of Rs 2.88 per thousand face amount (again as policy administration fees)
Do your math and see how much premium is left to invest in buying the units...
Another foolish policy is loading fee for top up is just 2%. So someone paying less premium and more top-up pays much less than someone doing it the other way around... and normally, people always pay more premium as compared to top-ups.
All this information ws not provided when I bought the policy and came to me as a shock....
I am just hoping that Birla Sun Life invests well so that at least the remaining premium amount covers up for the fees they charge.
Only +ve sides are
They assure 3% returns
Customer care is good and responses are fast.
In a nutshell, good packaging which is very costly... and will it be fruitful, only future can tell...
lesson learnt: Ask candid questions before buying anything and dont go by the brand name.