Usurious Insurance Companies the Reliance way of Life

Insurance is a subject matter of solicitation. Meaning it cannot be sold.

Despite this lack of understanding among agents makes them sell insurance as a marketable product. And agents in their desire for commissions sometimes choose a wrong person to "TARGET" as a customer. As a consequence a bitterness and bad blood causes people to go without insurance even when they need it.

A simple example is a person just starting his career. An agent comes to him with a life insurance policy proposal. The singleton does not have any dependents and his old parents have not yet retired. So there is no obligation or necessity for a life insurance. Or take the case of a working professional who is made to invest in an investment cum life insurance policy when the necessity is only for investment which can be done even in all the saving schemes such as RD(recurring deposit),FD(fixed deposit) or PPF(public provident fund).

This story is about akkamma(name changed to protect privacy) who serves as a domestic help. She got married and has a daughter. An agent approaches her with a proposal to invest in a high end child policy by Reliance Life insurance. Neither the agent nor akkamma realize the true purpose of taking out a life insurance policy. The family income of akkamma and her husband does not cross 20k rupees per month even when there is lot of work. She quit her job of domestic help and started Ironing clothes instead. The work leaves her exhausted. The agent convinces her to take out a policy for which she has to pay 6 thousand every six months. After some 18 years when the girl child achieves majority the policy would give her some money. Problems such as ill-health due to pneumonia left akkamma with little to save and she had to borrow money to pay for the insurance. Since two years the policy has not been renewed while the money that  she paid till now has come to 60 thousand rupees. If she does not pay 24000 rupees she might lose a large part of the money she has invested.

These kind of stories never end in my country and the government comes out with several insurance schemes for the poor. The problem is lack of awareness. While private insurance companies attract agents who have only their commission in mind true sufferers are the common man who does not get the right guidance or financial saving instrument for weathering the rough times. Life is made miserable by the greed of a few people.