Page 46 - IC23 life insurance application
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therefore to avoid such estimations as far as possible. The insurer takes care not to
cross subsidise the plans, i.e. to give advantage to one class of policyholders at the
cost of another. Earlier, bonus rates for endowment and money back plans were
same. But when it was realized that policyholders of money back plan are getting an
undue advantage (for they withdraw capital from time to time) the bonus rate was
rationalized. Now money back plans get bonus at a lesser rate than endowment
plans. Similarly the premium rates of the without profit plans have been revised
downwards from time to time so that these policyholders do not suffer compared to
with profit plan policyholders.
On the 1st July 2000, the Jeevan Dhara and Jeevan Akshaya plans have been
withdrawn because the rate of return assured in the premium structure became too
high compared to the actually realized rate of return.
Let it be understood that the insurer takes care to see that all policyholders are
treated equally and every one pays a fair price for the product that he buys.
Copyright Dr Rakesh Agarwal Sashi Publications Private Limited
Sashi Publications Pvt Ltd Call 8443808873/ 8232083010
