Life insurance industry needs to tackle mis-selling of policies
Online selling with discounting in premium and selling by cross-mutual support by way of discounts in premium to those having medical insurance and similarly those opting for medical insurance having life insurance will improve quality of sales;
The mutual fund industry has been successful in creating awareness about systematic investment plans to spread the cult of investing. Similarly, the insurance industry needs to create better awareness about the ECS facility to ensure regularity in payment of premium;
The insurance industry is known to manipulate the number of sales by splitting over a period of time to avoid detection of compliance of regulations. The industry must evolve a mechanism to classify each sale to an individual during the course of one financial year by cross-checking facts;
The lapsed policy premium should not be part of the profit and be transferred to a especially created policyholders fund, which can be used to compensate proven cases of frauds;
Unit-linked products are highly complex. The switching facility, a well-intended provision, is again beyond the understanding not only of the common people but also for the field force involved in sale of Ulips. Therefore, such products should be sold only to those who have experience in holding shares in a regular demat account of duration of minimum of two years. In fact, Ulips must be marketed only by agents who are qualified to sell MFs.
The incentives of foreign jaunts and expensive gifts must stop immediately as it proves to be big