“Nazar” lag gayi Health Insurance ko

Common cold is so common; whether it be dry season or wet season or even chilly winters. In India, if I can use a marketing parlance, it is the biggest below the line (BTL) disease which keeps the business of millions of General Practitioners running. Above the line (ATL) diseases like Cancer, Diabetes, Stroke or Heart attack are widespread but much has been publicized about it unlike our common cold.

And how do we tackle these attacks of bacteria and viruses? Though doctors, ayurveda, alternate therapy, and of course ‘Nazar’. Yes, you have read it right.

A simple word used by familes when typically a child falls ill or someone gets hospitalized or in general things don’t work out. A harmless black tikka or a thread to ward off evil; jokers in the form of ojhas and babas are the various forms of Nazar. It is the most convenient word which even the wealthiest or the educated do not refrain from using when a close one does not respond to medication.

So, let’s connect the two equations – at one end you have a country whose people irrespective of caste, creed or religion have or will believe in ‘Nazar’ at some point in their life and at the other end you have Marketing plans by Health Insurance companies looking for avenues to tap the under penetrated health sector.

Imagine a simple creative idea which portrays an array of emotions of fear, anxiety, frustration through visual picturisation of little children and parents followed by a punch line – ABC Health Insurance. Kyunki nazar kabhi bhi lag sakti hain.

It may sound outrageously stupid to some or plain trash maybe. But for some of you, it is an insight. The choice is yours.

Insurance without an Agent? Look who’s become the bakra now …

17 November was a Wednesday; more interestingly it was a Holiday for most of us – we were celebrating Bakri Eid. Since childhood, I have been mesmerized by a particular activity that is carried out religiously for days together by a few half-asleep, rustic kids towards this day – Leading an army of sheep. Young and old (I should admit I actually can’t figure out which one is older than the other but then size is a good indicator), a kaleidoscope of colours meandering across streets to open lands wherever there is a hint of grass.
And then they all disappear on the D Day.
Of late, similar specie of Homo sapiens is trying to repeat this Houdini act. Some call them financial agents, for a few they are broker, of course a good percentage of the lot call themselves as the ‘financial planners’ but Mr. Sharma who sold me few ULIPS and a bunch of LIC policies is my insurance advisor. He used to call me at least once a fortnight about a new plan in the market which is insurance cum investment plan, with an exciting new fund option… Today I miss his calls, that feverish pitch of paying just Rs. 1000 a month, the exciting news that the bonus rate is RS. 42 per thousand sum assured … isn’t there any great product in the market? Has the market crashed badly for the insurance companies?
Of course I checked with Mr. Sharma regarding his health and well being, everything was fine. He made a decision to quit being an insurance advisor, a profession he was involved with for the last 10 years. Last I heard he had rejoined his old manufacturing company as a shop floor supervisor.
He is not alone. There are many of them today at the cross roads of re-deciding their means of livelihood. These humble souls would come into our lives as insurance advisors and advised us on Life Insurance policies which would offer us good returns as well as protect our families for a long time. They convinced us that we were buying the best possible product in the market especially ULIPs and even offered a rebate at times with a heavy heart. I remember the first time I bought my ULIP plan, a new 100% equity fund was introduced and the name of the fund itself was so aggressive that I knew my money would double in 3-4 years. Not surprisingly it never happened. Nobody guided me or rather educated me on the policy charges – not my advisor, not the Company advertisements and not event the Regulator.
So what happened to the premiums I paid for a ULIP plan? Simple – a good portion was collected as commission, a neat portion went away as policy charges and the remainder gave me fund return which is only break even after 5 years. And life cover, only Rs. 5 lacs. So today if Mr. DrunkAndDrive drives over me dead, my little one gets only Rs. 5 lacs and a fund return of Rs. 1 lac and if take into account all my policies (including Traditional), I am only worth Rs. 25 lacs.
The mistake is all mine – An educated person like me needs to understand insurance better, the
significance of Life Insurance. But I know there is whole lot of population like me fleeced over the years by agents earning whole lot of commissions and selling us pseudo Life Insurance (read Cover) policies.
So what does the regulator do when it receives a huge number of complaints regarding mis-selling? It simply cuts down on charges drastically which leads to a sharp decline in commissions and makes the products customer friendly. Good for us. But bad for the entire clan of smart, smooth talking “sheep” that were fed for years together on Life Insurance only to be shown the D day.
After every TV ad or a radio jingle or even a print AD, the regulator makes it compulsory for the relevant Insurance Company to inform the customer –
“Insurance is the subject matter of the solicitation”. Sounds more like
“Smoking is injurious to health”. The regulator, the Industry, the Companies need to rise beyond one line disclaimers if they want to earn the respect of the customers.

Do we need Investment Gurus?

Do not believe in Tips, they’ll tip you over
Sell High, Buy Low
Enter the market, when others are worried
Exit the market, when brokers are investing as if there is no tomorrow
—- Sounds like Robin Sharma, I know it is more of Warren Buffet…but then have  pity on my poor soul.
At the end of the day it is unchecked, free of cost, on your face advice beaming across TV channels, magazines, articles and of course our dear Web. It’s similar to the tele-callers who call you for some ABC product and whom you can shut down and generally at a high pitched voice but you listen to these investment gurus with uninterrupted attention.
With so much advice floating around, especially when it comes to financial planning and investing in the market; the mind is always at cross roads and it is with great difficulty can one make a decision.
As a middle class person, the following list adds up to the confusion of making a financial decision –
1] My investment should not end up as a dead investment – every time the stock market sees a huge correction… even my aggressive risk profile corrects itself. Is it worth the risk?
2] Tax benefits – I need all of it. Not a single day goes by when I don’t think about my tax money ending up with some “Adarsh” guy involved with “CWG” (Corruption wala games) and to top it behaving like a “Raja”.
3] LIC kiya kya? – The other day I was visiting my bank for home loan installment and this was precisely the topic of discussion amongst the staffers. A huge chunk of the society, who work in banks/government bodies/semi-government institutions still hold LIC as sacrosanct to investment though at the end it offers no more than 5-7% returns with life cover. That is brand LIC for you. That is inadequate knowledge about Life Insurance for the society in general. That’s a huge customer base for all private life insurers.
4] Mutual funds – We have nothing in mutual agreement. They play around with the money of so many people and I don’t want anybody to play with my hard earned money. Every time when I see a particular MF company telling me that their XYZ fund is above average; they are not telling me that their DEF fund is giving below average returns.
At the end, to add up to all this confusion, investment gurus tell us – Investments are subject to market risks and past performance is no guarantee of future results. I find solace in buying 10 Kg Atta from Big Bazaar on any Wednesday – at least they tell me “Iss se sasta aur kahi nahin”.
So where am I heading? I have only one question to ask – where does this confusion lead us to?  Yes, we get attracted towards either MF, or stocks or LIC or ULIPs or some investment scheme based on a marketing impulse rather than really understanding what we are getting into. Of course gone are the days when some distant relative’s reference used to sell us LIC policy but even in today’s information savvy world we buy financial products based on the investment agent’s convincing note – Iss se behtar aur koi nahin.
Some companies have understood these issues and besides the normal adulation they heap on their products; they have now started combining the product benefits as a solution to our issues. Is it Smart Marketing or maybe realizing our needs finally? A few examples are:
So, my mantra is to not get carried away by every advertisement/radio jingle that talks high of an investment product rather stay alert, be smart, educate yourself about the financial instruments – and then plan! See, another advice-J