Objection Handling Manual - sales.baliconline.in · Objection Handling Manual (Compilation of...

Strictly for internal training purpose. Insurance is the subject matter of the solicitation.

Smart Solutions for Smart Consultant!

Objection Handling Manual

(Compilation of Solution Capsules)

By Product Development Department

With thanks to all the great minds from various departments, who helped us coin the right solutions, for their time, patience and expertise.


Objections Index

1. My 80 C limit is already complete. I do not need to make additional

investments

2. Returns under NSCs are guaranteed whereas they are not under ULIPs

3. There is no growth in FV of my previous policies. Why should I take a new plan?

4. I have heard that claim settlement is poor at BALIC. Why should I buy a plan

from you?

5. I have policy from my company. Why should I buy more policies?

6. I will buy after few months. Not interested to take this policy now

7. Claim settlement experience of my relative for Family CareFirst is poor and slow.

Why should I buy a plan from you?

8. Mutual Funds + Term Plan is better than ULIPs

9. I trust LIC more than any private insurers

10. There is no liquidity in Insurance

11. Minimum Fund Value after Partial Withdrawal is very high in plan

12. LIC’s child plan is better than yours. Why should I buy your plan?

13. Will your company exist after 15-20 years?

14. I don’t need of Life Insurance.

15. I have loans on me. I cannot afford to buy Insurance.

By Product

Development

2012


16. When market is bearish, FV falls drastically but when market is bullish, FV does

not rise in the same proportion.

17. Post Office Monthly Income Scheme is better than Pension Guarantee. Why

should I buy it?

18. I don’t have money. I can’t buy Insurance.

19. I do not have any dependants.

20. I am already over insured.

21. I have adequate money.

22. Rate of return for Immediate Annuity is lower than Fixed Deposits. Why should

I purchase it?

23. Fund growth rates are lower than other companies.

24. Regulatory bodies are not effective.

25. What if 10 (10) D is removed/ altered by Government at the time of policy

maturity?

26. BALIC is a private company.

27. A Health plan doesn’t give any returns. Why should I take it?

By Product

Development

2012


A. What should your future depend on – 80C limit or proper financial

planning? • Do you know how much corpus you would require to maintain the same lifestyle post

retirement?

• Restricting yourself to 80 C limit today will not help you in post retirement years.

• Insurance will help your family get the amount as planned by you in your absence.

• Everyone has different financial obligations. Therefore they need to save differently.

One amount cannot suffice everyone’s need.

• What will happen if you stop investing? How are you going to handle inflation?

• If you look at only tax today, your family would get taxed tomorrow.

B. Tax Planning should not be the only reason to invest • Your future needs will remain the same, whether the tax laws change or not.

• Will you stop saving, if savings instruments stop offering tax advantage?

• Investing always with a tax saving attitude may lead to unplanned investment and

often in wrong instruments.

• You need to prioritize what is important - tax planning or life stage planning.

• Our income is taxable, but does it mean that we don’t want to earn more? Insurance

too is a means to enhance your wealth.

• There is no tax benefit while buying motor insurance, travel insurance and so on. Do

we really need to consider the tax efficiency or look at our requirements?

• Tax planning is a different subject and has to be handled independent of your

investment objectives.

• Investment in other instruments like equities, FDs etc. do not offer tax benefits. But

people still invest in those.

C. Life insurance provides replacement income for your dependants

• In the later stages of your life, getting insurance may prove costly. You may even be

deprived of insurance.

• 80 C is about saving tax. Insurance is about future cash flows. It is about events that

are unforeseen or contingent.

• Life insurance is a must. Your decisions today will help your family maintain or

compromise on their standard of living. The choice is yours.

• We always tend to think that we shall be untouched by the mishaps and thus ignore

insurance.

D. Only forced savings can help you achieve your goals

• Let your investing habit be independent of temporary benefits like tax savings.

• Start early in order to get maximum value of your investments.

• People who invest regularly in a disciplined fashion without deviation make the best

out of their money.

• If your investment objective is clear, you need to put aside that quantum of money

irrespective of tax laws.

• Investment is like growing trees which needs time to grow. We need to plant the

seeds at right time to reap the benefits in future.

OBJECTION #1 “My 80 C limit is already complete.

I do not need to make additional investments.”

Smart Solutions for

Smart Consultant

By

Product Development


A. Guarantee comes at a cost • Guarantee caps your returns. Low risk leads to low returns.

• The cost of guarantee is always borne by you.

• Any investment tool with guarantee, gives you a return which is relatively risk free. So

your yields are bound to be low.

• The guaranteed returns which look good today may not look the same tomorrow if

economic situation turns unfavorable.

• If your risk appetite is moderate, you should invest in ULIP.

B. Portfolio Diversification - the new financial mantra • It is important to have a balance of risky and non-risky assets in your portfolio.

• Do not put all your eggs in the same basket.

• Your portfolio must contain an investment instrument that gives you inflation adjusted

returns - like ULIPs.

• ULIPs provide you better liquidity.

• ULIPs give you downside protection with an opportunity to benefit from upside gains.

• Historically equities have given good returns.

• Interest Income is non-taxable under ULIPs whereas it is taxable under NSCs.

C. ULIPs provide you comprehensive coverage • ULIP is the best combination of ‘security’ and ‘savings’. It will get you best of both the

worlds.

• ULIPs ensure financial support to your family in your absence.

• ULIPs ensure instant liquidity in unforeseen circumstances.

• Features like Waiver of Premium and Family Income Benefit are unmatched tools for

funding your family’s economic requirements in case of eventualities (death or Partial/

Total disability).

• ULIPs offer you additional coverage like Accidental Death Benefit and Critical Illness.

These are more significant guarantees.

D. ULIPs offer you host of flexibilities • Premature withdrawal is not possible with NSCs whereas ULIPs give you flexibility of

partial withdrawals after 5 years.

• Top-ups help you take advantage of the emerging ‘rising market’.

• ULIPs present us an array of different asset classes.

• We have single premium policies also which provides guarantee.

• With Wheel-of-life investment portfolio strategy, investor is relieved of the fund

management activities.

• Insurance policies can be assigned which helps in raising funds.

• Arrangements like Married Women’s Property act can only be done with insurance plans.

• Insurance companies provide you with better customer services as compared to post

offices.

E. Investment Instrument should match your objective • Guarantees are good when investing for short-term. For long-term, market linked

instruments gives better returns.

• Long-term objectives like children’s education and marriage are best met with ULIPs.

• Rupee cost averaging is best achieved through ULIPs.

• ULIP is a forced saving.

OBJECTION #2 “Returns under NSCs are guaranteed whereas they are

not under ULIPs.”

Smart Solutions for

Smart Consultant

By

Product Development


A. Market does not keep constant

• ULIP is a long term investment solution. One should not be worried about short-term

fluctuations.

• Rupee Cost Averaging gives us optimal result only when we keep on investing and

remain invested for a long time, since it takes care of short-term fluctuations.

• A layman may not understand when market is high or low. One shall never try to time

the market. It is always better to invest regularly and stay invested for a long-term.

• If you don’t like volatility, try our asset allocation fund.

• The entire market went through turmoil in last 2 years. It is natural to witness a

retarded growth. However, if you opt out at this stage, you may lose out on optimistic

side of it.

B. Systematic investment helps in creating a corpus

• It is better to keep investing regularly for life stage needs like retirement.

• To arrive at fund management skills, let’s look at NAV. The FV is mix of NAV and

charges. NAV will tell you, how good the fund is managed. If you are satisfied, you can

buy new plan with us.

• ULIPs if held till maturity will give better returns.

• Loyalty/ Guaranteed additions during the course of plan give a positive boost to your

FV.

• Charge structure is designed in such a manner that as your policy gets older, your

charge deduction reduces and FV accelerates.

C. Risk Reward relationship

• For better returns, you might require to switch from high risk to low risk fund and

vice versa.

• Fund selection is quite important. It decides the kind of return. If returns are not as

per selection, one can look at changing the fund.

• Our Wheel-of-Life portfolio strategy is a better option of fund management for those

who are moderately risk averse.

• Our products like Money Secure will let you enjoy the upside of the market and at the

same time protect your downside through its Assured Returns fund.

D. One needs to make provisions for changing objectives in life

• One plan cannot fulfill all your financial needs.

• You need to review your Human Life Value regularly and understand if you are

sufficiently covered.

• Does one Life insurance policy suffice all your needs of a lifetime? Why don’t we look

at your current risk and monetary requirements?

• Your previous policy may end in few more years. You still need to do your investment

planning for lifetime. How do you intend to go about it?

OBJECTION #3 “There is no growth in FV of my previous policies. Why

should I take a new plan?”

Smart Solutions for

Smart Consultant

By

Product Development


A. We follow the philosophy - “Settle Genuine Claims” • I am sure you do not have the complete picture in front of you. We believe in claim

settlement as the ultimate promise at BALIC.

• We take care of all the claimants in tough and trying times.

• Genuine claims never go unsettled at BALIC. We pay 8% interest for every day's delay

beyond 30 days from the date of last requirement received from customer.

• We have added a human face to our claim process - we have made payments on grounds

that family is poor or LA was illiterate or insurance was not explained to him properly,

etc. I am sure no other insurer follows the approach like ours.

• We have even paid ex-gratia payments.

• Claims that arise unnaturally like Mangalore Air Crash, Tsunami, Mumbai Blast etc. are

settled with minimum documents and at less TAT (Turn Around Time).

B. We need to follow some regulations while disbursing claims • We have a sound system and robust process which has ensured quick settlement post the

unfortunate eventuality.

• Claims can only be disbursed when all the required documents are received by the

company.

• In India, compared to developed markets, people are casual about Life Insurance

Contracts which they have purchased. In a way that very often they don’t know the

exclusions under the contract where claims will not be settled.

• Though exclusions are part of the policy contract, most often policyholders do not go

through them leading to misunderstanding while claims are made.

• We train our officers who in return guide the claimants in completing claim formalities.

C. We have facts and figures to back the good claim experience that we provide • If all documents are submitted by the claimant, we settle claims within 5-7 days from the

receipt of such documents. Claim amount reaches the customer within 15 days.

• Early claims where mandatory documents are received are settled within 30 days.

• Minimum documents are called for non-early claims so the turn around time for such

claims has reduced.

• Infact we have settled claims in span of 24 hours.

• Fastest claim that we settled was within 21 hours and amount paid was Rs. 18 Lakhs

(Mangalore Air Crash).

• We also have a unique feature of making part payment on receipt of few documents and

rest of the payment gets disbursed on receipt of pending documents. This is to provide

financial relief to the claimant.

• We have one of the lowest repudiation/ rejection percent in private insurers.

• Our repudiation ratio has reduced from 7.5% (in FY 2007-08) to 5.75% (in December

2011). Our improving ratios clearly indicate our efficient claim processing.

D. We have put measures in place to ensure smooth claims experience • We have a ‘4 C’ principle of Care, Clarity, Customer Centric and Communication.

• We have reduced the turnaround time for settlement of claims and we have improved

upon it compared to previous years.

• Our claim settlements are at par with the industry standards.

• Our investigators are provided a 72 hours training in claim processing.

• For the convenience of claimant, claims can be made online, at any BALIC branch or

through Customer Focus Unit who is there to help customers 24x7.

• We have a redressal committee to cater to customer grievances.

OBJECTION #4 “I have heard that claim settlement is poor at BALIC. Why

should I buy a plan from you?”

Smart Solutions for

Smart Consultant

By

Product Development


A. Coverage by company should be your secondary cover • What if you are in the transition phase of shifting to another company? You are not

covered in the interim period.

• What if your company decides to call-off the facility tomorrow?

• Usually coverage at workplace is only certain times of your basic salary.

• You may be underinsured at workplace.

• Evaluate your needs and insure yourself accordingly.

• You should look for comprehensive protection for yourself.

• Coverage should be adequate to support your family financially.

• Your Human Life Value should be the basis of your coverage.

B. Your coverage should fulfill your future objectives • You cannot fulfill your long-term goals like children’s education and asset creation

with your life cover at work.

• How do you intend to make provisions for your retirement with workplace

insurance?

• Have you taken care of your estate that you will leave behind for your dependants?

• Unit linked plan boost your investment while traditional plan offer you to secure

long-term savings.

• The workplace policy may end up satisfying our temporary needs, but they cannot

compensate for life long stable security

C. Individual plan is crucial

• How many people you have come across anyone who is only dependent on the cover

provided by the employer?

• Unlike a plan attached to company, with an Individual plan - You are the owner.

• Will you not buy a vehicle of your own even if your employer offers you pick and drop

facility?

• You need to review your life cover and continuously enhance the same. Workplace

cover does not provide you that.

• Your individual plan can cover you for Critical Illness and provide lump-sum benefit

which your workplace cover cannot provide.

• Having a health plan of your own gives you cover in situation of service gaps.

• By insuring yourself now, you can fund for your post-retirement income and the

corpus for your child that you always dreamt of.

D. Having own insurance means additional security

• During times of recession, no job means no security.

• Individual plan offers auto-cover/ cover continuation feature, which means you get

uninterrupted coverage.

• Enjoy opportunities of investing in different asset classes with your individual

insurance plan.

• It is important to ensure that all your family members are adequately covered.

• Employer coverage is a perk. You still need to plan for financial security.

• Additional riders opted with individual policy can ensure better coverage.

OBJECTION #5 “I have policy from my company.

Why should I buy more policies?”

Smart Solutions for

Smart Consultant

By

Product Development


A. Most people feel like this • Once we discuss your financial need, I will surely be able to offer you something

better.

• If we can talk for another 5 minutes, I can help you in taking a logical decision to buy

now or later.

• Time is an important factor in insurance because your Human Life Value and future

cost of living change with every passing year. Thus it is wise to keep on reviewing.

• I promise I will not insist on you buying insurance. I also promise you that giving me

a few minutes to talk will not be a waste of your time.

• Have you taken a plan that takes care of both your ‘cost of not living’ and also risk of

‘out living your savings’?

B. Buying later may lead to missed opportunity • A missed opportunity never comes back. You may regret not buying now.

• We always defer the decision to buy insurance as we do not realize the urgency of

living without cover.

• With rising costs it is better to plan for your future expenses from today itself.

• Would you like to defer planning for your child’s education? Remember LIFE has an

IF in it.

• Wealth is created by investing regularly for long-term. Thus more you defer, the less

you create.

• Insurance is all about taking care of uncertainties of life. Uncertainty can strike

anytime.

• No one can say “no” to Life Insurance. Either you pay for it now, or your family “pays”

for it.

• As you defer, the Cost of Insurance increases.

• Failing to PLAN is planning to FAIL.

C. We help you in asset allocation

• BALIC has a range of products that help you in asset allocation.

• Decision making becomes easy when you have number of choices. Even if you buy

later, you have a host of options with BALIC.

• Tax benefits under insurance plan are the additional benefits apart from investment.

• You can have plans ranging from pure protection to pure investment.

• BALIC plans help you manage your money better.

D. BALIC plans help you maintain your lifestyle

• You may decide to buy after few months or not to buy at all - I can show you how

other people have benefitted from our plans.

• We have different plans to suit your varied requirements, be it retirement, health,

education etc.

• I agree that most people are reluctant to buy insurance but it should be an important

part of your investment portfolio.

• What you can do with Rs. 10,000 today, you will need Rs. 20,000 tomorrow to do the

same thing. Have you planned for this?

OBJECTION #6 “I will buy after few months. Not interested to take

this policy now.”

Smart Solutions for

Smart Consultant

By

Product Development


A. Keeping customer convenience ahead of everything • Our highest priority is offering smooth claims to our customer. Probably your relative

has not got in touch with our Customer Care while filing his claim, which may have

caused problems. We have toll free numbers where customers are guided in order to

ensure smooth and hassle-free claim experience.

• To offer better claim experience to our customers, we have 24x7 customer support

through Toll free numbers and customer service portals.

• Our Customer Care representatives are fully trained to provide you necessary

information and assistance during claims.

• Please check if your relative's claim is related to any disease/condition under waiting

period of pre-existing disease/condition.

• We have 2600 network hospitals across 600 locations to provide cashless facilities. •

B. We have HAT( Health Administration Team) instead of TPA (Third Party

Administration) • We have been the pioneer in “in-house TPA” which has reduced our Turn Around

Time in settlement of claims and cashless pre-authorization approval.

• Around 70% of claims under Family CareFirst are settled through cashless facility.

HAT have ensured fast pre-authorization for cashless through a paperless process

and waiting time in only 30-40 minutes to get cashless approvals.

• Our network hospitals are happy with our fast cashless approval which in return

helps in offering better and early treatment for our customers.

C. Our Turn Around Time for settlement is best in the industry

• Cashless approvals are given in an average of 40 minutes compared to industry

standards of 8-12 hours.

• We have well trained team to process claims which comprises of doctors which have

helped us to improve our TAT.

• We are in the process of linking our claims system with hospital information system

to enable online claims processing.

D. Technology driven claim settlement process

• We emphasize on using technology to the fullest extent in claim assessment process.

• We are the pioneer in implementing paperless claim process with imaging technology

for cashless pre authorization which has been implemented since August 2010.

• Since most of the claim processing is done online depending on image based

documents, we have been able to achieve above average Turn Around Time.

• Customers are updated through SMS on claims decision. Also customers can view

claim status and pending requirements.

• We settle claims through ‘NEFT’ payments so that time is not spent in cheque

preparation, dispatch, time taken by bank, etc.

E. Customer Feedbacks led process improvement

• We have a process of customer satisfaction survey and feedbacks are used to improve

and enhance the claim settlement process.

• We keep reviewing Voice of Customers where we get to know their feedbacks. Such

feedbacks are analyzed and actions are taken to improve servicing of claims.

OBJECTION #7 “Claim settlement experience of my relative for Family Care

First is poor and slow. Why should I buy a plan from you?”

Smart Solutions for

Smart Consultant

By

Product Development


A. ULIPs are more convenient • Why do you want to go for 2 different plans when you can get advantages of life cover and

investment in the same plan under ULIP?

• Mutual Fund + Term Plan do not offer flexibility of adjusting life cover so you pay higher

cost of insurance even if your life cover need has reduced.

• In a pure term plan, you do not get back anything at maturity.

• Failure to make timely payment of premium in term plan shall lead to ceasing of benefits

and shall attract interest on revival.

• Re-instatement of ULIPs is hassle-free.

• The charge calculation in mutual fund is not as transparent as in ULIPs.

• Sum total of features and benefits offered by ULIPs is much more than mutual fund + term

plan combination.

• It is better to buy a home theatre rather than buying speaker, DVD, TV individually.

• One can easily reach an insurance company like BALIC because of our wider reach and

number of offices compared to a fund house.

B. ULIPs are more popular • Penetration of ULIPs is much more than mutual fund.

• The FMC of ULIPs is lower when compared to mutual funds.

• Switching from one fund to another usually attracts entry load in mutual funds.

• At BALC, you can do unlimited fund switches absolutely free of charge.

• ULIPs can be assigned.

• Some of our ULIPs offer you guaranteed addition of units which in turn accelerates your

fund growth.

• In ULIPs, you can get a projection of your maturity value (@ 10% and 6%) which is totally

absent in mutual fund.

• If you are not satisfied with our ULIPs, you can opt for free look cancellation.

• Claim settlement procedures in ULIPs are easy and hassle free compared to term plan +

mutual fund.

C. ULIPs are more flexible • ULIPs provide you with additional riders to boost your protection.

• ULIPs offer you option to choose and adjust life cover depending on your needs.

• With a ULIP, you can make additional investment through top-ups along with additional

Sum Assured.

• ULIPs have multiple fund options with different asset classes like equity, debt and money

market. You can choose a fund on the basis of your risk appetite.

• In ULIPs, you can exercise the option to surrender or partially withdraw your funds to

meet immediate requirements.

D. ULIPs help in creation of wealth

• The changes in charge structure in ULIP have tilted the scale in favour of ULIP.

• Surrender charges during the early years in ULIP encourages you not to liquidate your

investment.

• ULIPs inculcate the habit of forced savings.

• All mutual funds are not tax-saving tools but all ULIPs are.

• ULIPs offered by BALIC provides the choice of selecting Investor Selectable Portfolio

Strategy and Wheel-of-Life Portfolio Strategy.

• ULIPs are best suited for children’s education because they continue to infuse outstanding

premium to the fund in case of the unfortunate death/ disease/ disability of the parent.

OBJECTION #8 “Mutual Funds + Term Plan is better than ULIPs.”

Smart Solutions for

Smart Consultant

By

Product Development


A. Our presence in the industry is more than that of LIC • LIC is there for 56 years because private insurers were not allowed before.

• Allianz has an astronomically high Assets Under Management spanning more than 70

nations. Bajaj on the other hand is a common household name in India.

• If vintage is the deciding factor then we have a vintage of more than 121 years.

• Experience of LIC = 55 years+, experience of Allianz = 121 years+.

• Do you have a telephone connection where the service provider is more than 50 years

old?

• Do you have a bank account in a private bank which is more than 51 years old?

• BALIC (like any other private players) enjoys a place of pride in the industry as LIC. It

is only a false perception that LIC being old is the only bankable company.

B. Every one knows Bajaj Allianz as a Brand • Bajaj and Allianz both are highly trustworthy and renowned companies.

• Our presence is spread Pan India. We cater to wide segment of people.

• Our number of branches itself proves that we are here to ‘stay’ and not run away.

C. We are trustworthy

• Perception is the deciding factor here. Being new in Life Insurance industry makes us

all the more responsible and cautious towards our action.

• You should see the number of customers who have trusted us with their money in our

hands.

• Many of our policyholders are LIC’s existing policyholders. They have bought plans

from us because they have seen value in it.

• Lakhs of customers in 10+ years bears a testimony that BALIC as a brand commands

enormous trust and credibility.

• Allianz is one of the world's largest asset managers, with third-party assets of 1,281

billion euros under management at year end 2011.

• Government does not lose control over the sectors which are privatized. They have

their specialized regulatory bodies – TRAI for Telecom, RBI for Banks, similarly IRDA

for insurance.

D. Bajaj Allianz is regulated by IRDA

• As per IRDA, it is compulsory for all insurers to have a start up capital base of 100

crore.

• Statutory requirement of the regulator (IRDA) is to maintain a 150% solvency margin

for the policyholder’s good.

• The regulation ensures an even playing field for us as well as LIC.

• Why 80C/80D benefits are given on policies of private insurer too, if they were not

been under proper regulation of Indian Laws?

E. Evolution is the need of the hour

• Customer previously had only 1 choice, now they have many. You should have choice

in front of you to judge the best from the better.

• The way we have graduated from a black and white TV to a colour TV, we need to

look beyond for greener pastures.

• Even being only few years old in Life Insurance industry, we have rolled out, some of

the best investment options in the industry.

OBJECTION #9 “I trust LIC more than any private insurer.”

Smart Solutions for

Smart Consultant

By

Product Development


A. Liquidity of Insurance weakens your protection and economic value • What do you value more - protecting yourself and your family or option of liquidity?

• Liquidity does not ensure good returns.

• Insurance provides you targeted amount for specific events in life like marriage,

education, retirement, etc.

• Insurance is aimed to preserve your economic value even in your absence.

• You are so concerned about liquidity to meet contingencies of your day-to-day life.

Think about the money one will require in case of an eventuality in future.

• Insurance is meant for compensating the financial loss due to death, disease and

disability.

• Do you ask for liquidity while insuring your vehicle?

B. Liquidity may result in “NO ASSETS” • Have you ever met someone who has become rich with all liquid assets in his

portfolio?

• Liquidity is a biggest hindrance in asset creation. Asking for liquidity comes at the

cost of your Capital appreciation.

• If you have cash readily available, you will find several reasons to spend. Excess

liquidity makes you extravagant.

• Be cautious and careful while deciding the proportion of liquid assets.

• Liquidity will not help you beat inflation.

• The spirit of insurance is diluted by providing liquidity.

• Insurance is ‘sharing of risks’. If all the people look towards liquidity, there would be

no pool left to share risks from.

• High liquidity gives you low yield and low liquidity provides you high returns.

• Insurance focuses on creating an asset and not liquidating an asset.

C. Insurance is a long-term investment vehicle

• With insurance plan, you get an opportunity to invest in various asset classes and get

a life cover too.

• Insurance helps you in diversification of portfolio.

• Insurance is a forced saving.

• Insurance plans are taken to fulfill the desired long-term objectives.

• If your objective is to save for future, then issue of liquidity should not bother you so

early.

• Does Public Provident Fund/Employee Provident Fund have absolute liquidity? No,

because they are for long-term benefits for your retirement.

• Sow now and reap later is the basis of insurance where growth is gradual but

effective.

D. Some of the Insurance plans also provide scope for liquidity

• In ULIPs, you can exercise the option to surrender or partially withdraw your funds to

meet immediate requirements.

• If you need money at specific intervals, you can go for a money-back plan.

• Your insurance policy can be pledged as collateral for a loan.

OBJECTION #10 “There is no liquidity in Insurance.”

Smart Solutions for

Smart Consultant

By

Product Development


A. Evaluate your objectives • In case objective is short-term liquidity, you can keep a separate fund in form of Top-

up FV which will earn high returns and at the same time, allows you liquidity.

• You can split your investment in a number of policies and opt for complete surrender

as and when required.

• One should not substitute his/ her short term requirements from a long term

instrument like ULIP.

• The objective of Life Insurance plan is to achieve targeted financial goals. With the

goal in mind, partial withdrawal should be best avoided.

• Money multiplies if it is invested for long-term.

• Higher minimum FV allows longer sustenance of your cover incase you fail to pay

future premiums due to financial emergencies.

• To get an optimal growth, you need to stay invested with a good amount.

• Plan judicially - your long term and short term objectives.

• Your long-term financial goals get affected, changed and forgotten, if you are given

too much flexibility.

B. Reasons for higher minimum Fund Value post partial withdrawal • If the FV is insufficient to deduct any charges, the policy is likely to be terminated.

• Higher minimum FV decreases the chances of foreclosure of your policy and hence

ensures that you fulfill your financial objectives efficiently.

• It safeguards some amount which can grow inspite of contingency withdrawal.

• The higher balance after withdrawal shall help you gain momentum whenever there

is any appreciation in the market.

• It also allows a decent amount in your Fund Value for all future contingencies.

C. Partial withdrawal should only be contingency-based and not want-based

• Liquidity comes at the cost of wealth creation. So insurance plans should not be

looked at for purpose of short-term liquidity which is in contradiction to the long-

term goals for which the plan was bought.

• Liquidity and Growth are inversely proportionate. You will have to sacrifice one for

another.

• Money never sleeps. Higher the FV, better will be the growth.

• You actually buy a ULIP for death benefit and maturity benefit. Both will get affected

because of partial withdrawals.

• Partial Withdrawal means cost to the policyholder. It is the opportunity cost for the

money withdrawn.

• Even the regulator wants you to stay invested for long-term. According to them,

Partial withdrawal should only be allowed after 5 years.

• One needs to take care of his/her estate planning.

• How can one build corpus for retirement/ children’s education, if we keep on making

partial withdrawal from the same plan?

OBJECTION #11 “Minimum Fund Value after Partial Withdrawal is

very high in plan”

?”

Smart Solutions for

Smart Consultant

By

Product Development


A. Why do you buy a Child Plan

• Usually people buy a child plan to enhance financial security to the child and thus a

child plan should not be seen only from an investment return perspective.

• Bajaj Allianz ChildGain offers better coverage and value for money than LIC’s Child

Plan.

• It is not the child who requires insurance, it is you who requires it the most to ensure

your child’s financial security.

• You don’t buy a child plan only for returns. The objective of buying a Child plan is to

have a comprehensive solution and a sound financial planning.

• By investing now, you can build a good corpus for your child’s future that you have

always dreamt of.

• For a good child plan, one needs to ensure:

a) In my absence, my child gets maximum financial security

b) In my presence, the plan should give a good return.

B. Evaluate returns

• Bajaj Allianz ChildGain is more economical than LIC’s Komal Jeevan.

• Guarantee Additions in LIC Komal Jeevan will always restrict your upside potential.

With ChildGain, a participating plan, you have the advantage of getting higher bonuses

compared to LIC’s guaranteed additions which restricts your potential growth.

• LIC offers Simple Reversionary Bonus whereas our child plan provides you

Compound Reversionary Bonus which means you get the power of compounding.

C. Evaluate Features

• Bajaj Allianz ChildGain provides you extra coverage with a unique ‘Start of Life’

benefit.

• With inbuilt Family Income Benefit, Waiver of Premium and Start of Life benefits,

ChildGain offers comprehensive coverage.

• Total Maturity Benefit is upto 115% of Sum Assured + Vested Bonus in ChildGain

compared to 100% of Sum Assured in LIC’s Child plans.

• Bajaj Allianz ChildGain comes in 4 variants taking care of all your possible choices.

• Plan your maturity proceeds every successive year or alternate year with ChildGain

21 and 24 variants.

OBJECTION #12 “LIC’s Child Plan is better than yours. Why should I buy

your Child Plan?”

Smart Solutions for

Smart Consultant

By

Product Development


A. Stringent regulations to protect interest of policyholders • Regulatory framework ensures that players in the market remain healthy.

• IRDA keeps an eye on operations of insurance companies and guide, counsel and

direct them.

• Regulations are formulated in such a manner that insurance companies stay afloat

under any circumstances.

• Insurers are required to have a start-up capital of Rs. 100 crores.

• Insurers are required to maintain 150% of solvency margin which is monitored by

IRDA.

• IRDA periodically verifies valuation records of all the insurance companies.

Investments of policyholder’s money by an insurer are also guided by IRDA.

• An Appointed Actuary ensures that the company’s actions fulfill the requirements as

approved by IRDA.

• The regulatory framework is evolving and every step taken ensures sustenance of

existing players.

• If you look at present financial scenario, government across the world have

intervened to keep insurance and banking companies healthy and sound, it is because

they are the backbone of the economy.

B. Role of Ombudsman • Ombudsman act as protection for the policyholders.

• Ombudsman ensures that policy level grievances are well attended.

C. Bajaj Allianz - Brand value

• Only companies with proven financial track record come into insurance industry.

• Bajaj and Allianz, both have track record of long-term market presence in any

venture.

• Allianz is one of the world's largest asset managers with total assets under

management of 1,657 billion Euros as on December 31, 2011.

• Bajaj’s business philosophy is to ensure excellent insurance and investment solutions

by offering customised products, supported by the best technology.

• Bajaj is very sensitive to Corporate Social Responsibility activities. No company will

be socially-oriented, if they are not meant for short-term.

• We are one of the trustworthy brands in the industry.

D. Insurance is a growing industry

• Insurance is a sunrise industry.

• Private Insurance industry in India has tested positive for Growth steroid.

• The same can be reinforced from the fact that there are 24 private life insurers in the

market where there were only 11 in the year 2001-02.

E. Insurance is a long-term business

• Insurance is a long-term business. Shareholders put in their money not for short-term

business.

• While modeling for future years, insurance company takes into consideration the

remote of the remotest possible eventuality that might take place.

• Insurance companies are difficult to make and yet more difficult to sink as they put a

lot of assets to cover the liability they underwrite.

• Insurance companies have a long developmental phase and a result; they are bound

to stay for long.

OBJECTION #13 “Will your company exist after 15-20 years?”

Smart Solutions for

Smart Consultant

By

Product Development


A. Why do you feel you don’t need Life Insurance ? • Is it that no unfortunate event like disability/ critical illness will ever occur to me?

• Am I also sure that I will wake up tomorrow morning?

• Am I sure that my family will have the same kind of lifestyle in my absence?

• Can we afford to remain irresponsible towards our family and their needs?

• Do you insure your vehicle? Why?

• Do you value yourself less than your vehicle - for which you have an insurance policy?

• Have you ever calculated your “Human Life Value”? - Your cost of “Not living”.

• Living without insurance is like Gambling.

• Have you come across any financial expert who has advised NOT TO BUY Life

Insurance?

• Life Insurance is no more a choice - it is a NEED.

B. There is no parallel to Life Insurance • Life Insurance helps you create an estate by way of forced savings.

• Life Insurance today has dual advantage - Insurance + Investment.

• Name an instrument available in the market which will give you the assured amount –

whether you are there or not there?

• It is a time tested vehicle for wealth creation.

• Life Insurance policies can be mortgaged and it can help you create “Encumbrance

free estate”.

• Your portfolio should ideally contain some long-term financial tools. Life Insurance is

one such time tested tool.

• Life Insurance forms the base of your financial portfolio because it is also a Risk

Mitigation Tool.

• Insurance is a tax efficient vehicle. Your premiums give you tax benefits and policy

benefits are tax-free.

C. Life Insurance is a risk transfer mechanism

• Life Insurance and investments are two different things. It is a mistake to judge

insurance only from the point of view of investment.

• Insurance is the only vehicle that takes care of negative sides of life.

• Life is full of uncertainties. Life Insurance takes care of “certain uncertainties”.

• Life Insurance provides variety of risk coverage options like – illness, accidents and

premature death.

• Absence of Insurance will compel you to spend your lifetime savings in case of

contingency. You need to review your liabilities every couple of years and buy

insurance accordingly to cover them.

• People ask “What I get in return from Insurance?” I say “You get peace of mind”.

D. Life Insurance ensures economic freedom

• Life Insurance will take care of my family when I am not there and it will take care of

me when nobody is there!

• We will still want our child to go to the same school even if we are not there.

• Would you like your family to sell your house or gold to meet day-to-day expenses?

• Insurance helps keeping you and your family free of any liabilities.

OBJECTION #14 “I don’t need Life Insurance”

Smart Solutions for

Smart Consultant

By

Product Development


A. Insurance helps you in present and future • Loans help you to enjoy the lifestyle you want. But insurance help you to sustain that

lifestyle.

• The cost of living tends to increase with each passing year.

• Loans can be the solution to your immediate need. But insurance is designed for

needs in future.

• You don’t want to leave your family with all the liability. Insurance ensures that the

loan does not become a burden to the borrower’s family.

• Insurance is a risk mitigator.

• With insurance, you can “Jiyo Befikar”.

B. Loans create financial insecurity

• Having insurance becomes all the more important when you have any loan against

you.

• Insurance acts as a surety to pay your loans in your absence.

• Buy the insurance plan to cover your outstanding loan.

• Term plans are cost-effective where you get higher cover at lower prices.

• Insurance is an all-in-one tool, protecting in form of life cover, accidental cover and

savings too.

• The thought of caring for the family is foremost in the minds of each breadwinner and

an insurance policy with its life coverage takes care of financial commitments in an

effective way.

C. Loans are always a liability

• Loans are the other name for liabilities. “Living this moment” is a misnomer.

• Housing finance institutions prefer insurance policies on the life of a borrower.

• Multimillionaire Warren Buffet has discouraged the principle of buy now and save

later.

• Loans raised by you leave you with a hypothecated property. Insurance policies leave

you with an assured property.

• You can repay the loan you have taken. Does your dependant in your absence can still

repay the loan that you have taken?

D. Insurance is a forced saving

• Insurance will ensure that your savings are intact for your retirement.

• No amount of loans can actually provide a solution for your post retirement

requirements.

• With insurance, you can plan a targeted amount in future and the question of loan will

not arise.

• Even by contributing as low as Rs. 50 per day, you can plan your future.

• Don’t we save that little extra to buy a car? Then why don’t we go that extra mile for

insuring our lives.

• It is wise to increase an appreciating asset - Insurance.

• Your loan raising ability reduces with age. In future, you have to be more dependants

on the pool of fund that you have created.

• Two things can kill you “worry” and “hurry”. Insurance can save you from “worry”.

OBJECTION #15 “I have loans on me. I cannot afford to buy

Insurance”

Smart Solutions for

Smart Consultant

25th January 2011

By

Product Development

Smart Solutions for

Smart Consultant

25th January 2011

By

Product Development

Smart Solutions for

Smart Consultant

25th January 2011

By

Product Development

OBJECTION #15 “I have loans on me. I cannot afford to buy

Insurance”

Smart Solutions for

Smart Consultant

By

Product Development


A. Re-evaluate your risk appetite • Rather than looking at fund performance, we should first look at our risk taking ability

and time frame that one is looking at to arrive at the kind of fund that suits.

• If you have high risk taking appetite, you should take higher equity fund exposure. If you

have low risk profile, you can opt for Asset Allocation Fund.

• Returns are directly proportional to risk. Higher the risk, higher the returns and vice-

versa.

• You can diversify your investment portfolio as per your risk appetite.

B. Revisit your portfolio and assess your fund’s objective • Clearly understand the objective of the fund that you have invested in. Evaluate it. If it

doesn’t match your risk profile, you may exercise fund switch option.

• Fund Managers do portfolio management to ensure risk reward optimization.

• Objective of the funds that you have invested in may not only be to reap benefits for you

from upside of the market; it may be also to protect you during the downturn of the

market.

• If fund objective is to limit downside, NAV may appreciate at a lower rate in a bullish

market but it would outperform in a bearish market.

• Fund Managers may take investment decisions which may not be for quick gains but for

long-term gains.

• Don’t keep all your eggs in the same basket. Make use of our basket of funds.

C. Your Fund performance may not mirror the market index • Ideally you should see the overall performance of the fund over a timeframe and in

context of the fund objective and not just in the context of the market index.

• Stocks for which market has gone up or down may not at all be part of your fund.

• Returns under the fund should be viewed as return on NAV since inception. This would

give a better perspective as there are many reasons for which FV may be low like charge

deductions, partial withdrawals made, etc.

D. Market cannot be timed

• One should rather invest regularly on a monthly/quarterly/ half yearly/ yearly basis. Law

of averages would enable investor to have a reasonable market level at the time of entry.

• While investing, we need to achieve Rupee Cost Averaging by investing at specific

intervals and look at fund performance over a reasonable time-frame.

• Every investment requires time to grow. There is no point in being impatient when you

have invested in market-linked assets.

• WHEN (the time you invest) is one of the key components of investing. The other is for

HOW LONG.

E. Get an edge with Bajaj Allianz

• We will suggest you not to get bothered about bearish/ bullish market and have faith in

our brand and our effective fund management.

• We have a team of highly experienced Fund Managers who have proved their efficiency in

the fund management so far.

• All our funds are IRDA approved.

• You can opt for our Asset Allocation Fund which is specially managed by Fund Managers

to provide optimum returns to investors.

• As our policyholder, We will suggest you to visit our website and look at “Investment

Insight” which will give you an accurate picture of our funds.

OBJECTION #16 “When market is bearish, FV falls drastically but when market

is bullish, FV does not rise in the same proportion”

Smart Solutions for

Smart Consultant

By

Product Development


A. Post Office Monthly Income Scheme (POMIS) and Pension Guarantee are not

comparable because they are structured for different objectives • Your need to invest depends on what do you want to achieve. If you are looking for a lifelong

solution, you need to be very careful and evaluate every aspect.

• Pension Guarantee is a lifetime solution as compared to POMIS which is only a temporary

parking of money where one gets monthly interests.

• Locking your money into Pension Guarantee is in fact a good idea as you get no scope to deviate

from your retirement planning and run the risk of spending your retirement capital.

• Getting the maturity proceeds in hand after 6 years in POMIS may tempt you to spend it

elsewhere. You can safeguard your long-term income with Pension Guarantee.

• In case of downward fluctuations in interest rates, Pension Guarantee will still be able to give

you better returns.

B. Get tax benefits with Bajaj Allianz Pension Guarantee

• Let me make you aware that POMIS was tax free under section 80 (L) but this section has been

withdrawn w.e.f. 1st April 2005.

• Pension Guarantee helps you save tax on retirement benefits upto a limit of Rs. 1 lac under sec

80 (C).

C. BALIC gives you better services

• BALIC is a customer friendly organization. We are known for our customer service.

• If you change your city under POMIS, you have to transfer your account also. Whereas, at

BALIC, we have centralized customer service solutions for hassle-free services.

• Making your POMIS renewal every time may be quite difficult when you are not residing in the

same city where your Post Office is.

• Payouts in Pension Guarantee are directly credited to customers account while in POMIS

customers have to withdraw.

D. Pension Guarantee is a long term retirement solution

• POMIS is a temporary investment which gives a regular interest income. On the other hand,

Pension Guarantee is a permanent solution for regular old age income.

• The trend of POMIS and instruments like PPF shows that with time rate of interest is reducing.

So you may risk your old age planning.

• If you look at other countries, annuities are primarily purchased from insurers as they can

manage the risk of interest fluctuations better.

E. Pension Guarantee gives you more flexibility

• Pension Guarantee gives options a) Life Annuity b) Annuity guaranteed for 5/ 10/ 15 and 20

years and c) Life Annuity with Return of Premium, whereas with POMIS you can stay invested

only for 6 years.

• Pension Guarantee offers you Return of Premium option under which the purchase price is

paid back to the nominee.

• POMIS gives you compulsory monthly payments. Under Pension Guarantee, you can select your

annuity payment frequency (Annually, Half yearly, Quarterly and Monthly).

• POMIS has a limitation on maximum investment Rs. 4.5 lacs for individual and Rs. 9 lacs for

joint a/c which makes it very unattractive stand alone tool for retirement planning.

• You need to renew your POMIS every 6 years. On the other hand, Pension Guarantee assures

you annuities throughout your life.

• The rate under Pension Guarantee gets better at higher age at entry. So you can keep on buying

as your need for monthly income increases.

• We give you a free-look period of 15 days to try out the plan and give it up if you don’t like the

same. This flexibility is not available with POMIS.

OBJECTION #17 “Post Office Monthly Income Scheme is better than Pension

Guarantee. Why should I buy it? ”

Smart Solutions for

Smart Consultant

By

Product Development


A. What is Savings? • We follow income minus expenses equal to savings. However, we should follow income

minus savings equal to expenses.

• If money is scarce today, so it will become more scarce tomorrow.

• Have you experienced a situation where you did not have any money at all? Think what

will happen when our earning capacity gets reduced due to retirement or old age.

• The day to start investment in lump-sum will never come.

• We all know that drops of water make an ocean but we fail to follow the same.

• If you seriously think about your present and future commitments, I am sure you will like

to manage money better.

• Would you like to live a life where you are in a situation of constantly worrying about

money?

• If you think that you don’t have money - then it is the right time to change the situation to

say “I have money”.

B. Insurance is investment for your future

• You do not need money to buy insurance. You need conviction towards the responsibility

you have towards yourself and your loved ones.

• Lost opportunities are never re-gained. Thus it is better to start now.

• Lack of financial planning can upset your lifestyle because of increase in cost of living and

health care.

• Not having money calls for more insurance so that I do not suffer in case of health or

accidental contingencies and my family is also financially secured. •

C. Money will not grow till you make a wise decision

• Insurance has dual benefits 1) Compulsory savings and growth of money 2) Financial

cushion to the family upon the unfortunate demise of the earning member.

• Money is not only about how well you earn, it is also about how well you save.

• Managing money and saving for future is not a matter of ‘To do’. It is ‘Must do’.

• Your priorities for your near and dear ones demand organizing your expenses and

investing money accordingly in insurance.

• You need to prioritize now on how you want to use your money. Your today’s decision

bears tomorrow’s results.

D. Insurance is a piggy bank

• Small contribution to insurance can build up protection and wealth for you.

• You are willing to take a loan today, but if you would have saved, you could have used

your own money.

• You will surely want to give best education to your child, buy a house or travel to a nice

place.

• Insurance makes it possible for you, to have money tomorrow by imposing the habit of

forced savings.

• Imagine the feeling of comfort and confidence when you actually know that you have

money to fulfill dreams of your loved ones. •

OBJECTION #18 “I don’t have money. I can’t buy Insurance”

Smart Solutions for

Smart Consultant

By

Product Development


A. Financial Security for Self

• It is a myth that insurance is taken only for dependants.

• Insurance plan is an asset for you.

• You not having any dependents make it even more crucial for you to ensure your

financial independence at the earliest.

• Insurance makes you self-sufficient. You will not have to depend on anybody and you

will be living your life with self respect.

• Insurance provides you growth, safety of funds, liquidity and above all protects you

from unforeseen eventualities which can harm you financially.

• Insurance is a ‘forced saving’ for you.

• Average life span has increased.

• Outliving your saving is a big risk. You need good financial planning to cover yourself

against this risk.

• Planning today will help you pursue your dreams tomorrow.

• Financial security gives you ‘peace of mind’.

• You can even pledge your insurance policy as collateral for loan.

• Insurance, being a tax-efficient tool, will help you in tax planning.

B. Health Insurance is crucial

• Insurance takes care of 1) Diseases 2) Disabilities apart from death. How will you

protect yourself from the financial losses arising from any disease and disability?

• Health maintenance is a major expense today and it will become expensive as one

grows old.

• Make a provision today to have a healthy tomorrow.

• With rising health care expenses, the need for making provisions is higher.

C. Plan your retirement through Insurance

• Becoming financially independent is important but sustaining financial independence

is all the more important.

• Insurance liberates you from financial constraints where you are free to choose the

quality of your life.

• A regular income post retirement is a must. It is better to make provisions now.

• Financial independence will be of utmost concern post retirement.

• You can choose a pension plan depending upon your requirements.

• We have pension plans with and without life cover.

• Pension will help you lead your retired life with dignity.

• A regular pension means ‘No tension’.

OBJECTION #19 “I do not have any dependants”

Smart Solutions for

Smart Consultant

By

Product Development


A. Are you really over insured?

• Have you calculated your Human Life Value? Your very idea of being over insured

may be misleading.

• Human Life Value shows immediate financial needs of dependents in case of untimely

death of a person.

• Is your present life insurance policy enough to take care of your present liabilities? If

no, then you are not over insured.

• Revaluation of your life insurance is necessary to make up the mismatch between the

present earnings and future liabilities.

• While deciding on your level of insurance make sure you are provisioning for 1)

Standard of Living 2) Inflation 3) Income.

• Have you made enough provision so that your family continues to maintain the same

lifestyle even if you are not there?

• The only thing constant in this world is change. With changing life pattern, your

insurance needs will also change.

• Most of the insurance plans that people buy, generally mature at 50/60 years of age.

However, insurance coverage is required even at advanced ages.

• The problem is that today you think you have enough provision and tomorrow you

repent, that you should have done more.

B. Insurance plans are a long-term financial vehicle

• Life Insurance is a tax saving tool. The maturity is also tax free.

• Life Insurance helps you save to fulfill the future financial goals.

• Life Insurance can be used as a vehicle for post retirement planning.

• Life Insurance policies can be mortgaged to secure loans.

• Life Insurance help you mitigate the risk of surviving too long.

• Annuity plans provide you regular income as long as you survive.

• Life Insurance is an effective mechanism to match your future cost of living without

sacrificing your present life style.

• It is also a very good instrument for passing inheritance.

• Life Insurance policies help you create Encumbrance Free Estate.

• Apart from Insurance, our plans also offer excellent scope for financial management

and wealth creation.

• ULIPs are designed in such a way that only in initial years you have to pay the cost of

insurance because in later years, they operate with your fund value only.

C. Life Insurance provides you host of additional coverages

• Reinforce your health coverage through health plans.

• Critical Illness rider provides extra coverage against specific critical diseases.

• Fortify your coverage with additional accidental protection.

OBJECTION #20 “I am already over insured”

Smart Solutions for

Smart Consultant

By

Product Development


A. Insurance is for uncertainity • Insurance is a means to mitigate risk.

• How about reviewing your insurance needs?

• It is important to have adequate protection along with adequate money so that you

and your loved ones do not suffer heavy financial loss.

• You are saving/ investing today for your future, but what if the future does not turn

out to be as planned?

• It is important to calculate the cost of “NOT LIVING”. Insurance is about covering this

cost..

• You may have covered yourself of the existing liabilities but what about future

commitments or ''out living your saving'' ?

• The family needs a steady flow of income in case of unfortunate demise of a earning

member .

• Insurance is not about adequacy of money. It is about provisioning for uncertainties.

B. Insurance maintains your adequacy

• More money calls for more insurance.

• Despite having adequate money, don’t you insure your car? Then why not your own

life, which is priceless.

• Adequacy is a relative term. Whatever is adequate today may not be adequate

tomorrow.

• If you have adequate money, have you stopped investing?

• How do you define “Adequate”? Is it as per your today’s need or future needs?

• What about your child’s future? Have you planned for the same?

C. Insurance is not only for you

• It is also for your family and your loved ones.

• Have you assessed whether the insurance cover that you have taken is adequate as

compared to your earnings and changes in lifestyle?

• Insurance can help us achieve long term goals whether we are there or not.

• Our life is closely linked to the life of our loved ones. If we do not value our own life,

we are putting the lives of our loved ones at stake. Do you want it?

D. Insurance is a double edged sword

• More than just a risk cover, it is a measure to make your money grow.

• Tax benefits under insurance plan are the additional benefits apart from investment.

• The primary objective is to plan for your future and sustaining your lifestyle.

• Insurance helps you in maintenance of your lifestyle in future.

• Insurance helps you in mitigating the increasing cost of living.

• It will help you against rising medical costs.

• You have to put a very little part of your money in buying a plan. The benefits it will

deliver are manifold.

• It is the best way to pass inheritance.

OBJECTION #21 “I have adequate money”

Smart Solutions for

Smart Consultant

By

Product Development


A. Pension is a regular income post retirement

• Unlike Fixed Deposits, your Pension is a regular income. Immediate Annuity plan

guarantees regular income (Pension) for life.

• The average lifespan is increasing; therefore there is greater need for regular income.

One can have it through Immediate Annuity plans only.

• Immediate Annuity plan offer the convenience of ‘invest’ and ‘forget’.

• What is it that you value in old age - safety, security or growth? Immediate annuity is

the best tool to ensure safety and security.

• Stability of income is important in old age.

• When you are assured of a regular income, it is always easy to plan your day-to-day

expenses.

B. Fixed Deposits are for meeting short-term goals

• Fixed Deposit is a tool to park your money for short/ medium term investment.

Therefore planning your future on the basis of Fixed Deposit is not as worthwhile.

• The Fixed Deposit proceeds may end up satisfying our temporary needs, but they

cannot compensate for life long stable income.

• Immediate Annuity plans are meant to provide financial protection to you and your

dependants. Fixed Deposit only serves the purpose of instant availability of fund in

case of an emergency.

C. Fixed Deposits cannot substitute Immediate Annuity plans

• Immediate Annuity plans are built for regular income. Fixed Deposits remains a

choice which one is tempted to postpone.

• Immediate Annuity plan help you mitigate the risk of living too long.

• Fixed Deposit does not ensure fixed returns for life time. Immediate Annuity does.

• Interest rate of Fixed Deposit fluctuates while Installment of annuity is a contractual

obligation for the insurance company.

• Immediate Annuity is a provision for future income. Once sufficient provisions are

made, Fixed Deposit can be a secondary choice for meeting sudden contingencies.

D. Importance of a risk-free earning after retirement

• Immediate annuity is the only tool which is not affected by change in interest rate.

• What will happen if 15 years down the line, Fixed Deposit rates fall steeply?

• Fixed Deposit is for specific time frame and the proceeds needs to be re-invested with

the risk of having low interest rate on re-investment.

• Fixed Deposits have credit risk.

OBJECTION #22 “Rate of return for Immediate Annuity is lower

than Fixed Deposits. Why should I purchase it?”

Smart Solutions for

Smart Consultant

By

Product Development


A. Comparing right Fund and right time frame

• Compare return of the Funds which has similar asset profile and objective.

• One should look at long-term for performance rather than short-term.

• One should not compare return across different time frames. 1 month return of a fund

against 3 months return of another fund is not an apple to apple comparison.

• Before comparing two different Funds, we should make sure that they have the same

underlying assets and risk profile.

• Comparing Funds is not as easy as it may appear to be. One has to make sure that the

right funds are compared.

B. Wide choice of Funds

• Do other companies offer you wide variety of funds as we do? We offer the customer

to choose a Fund according to his risk taking appetite.

• We have various funds for various time horizons.

• We are one of those few companies who offer you Index Fund.

• We offer a wide choice of Funds and depending on the performance of different asset

classes, you can switch amongst these funds to maximize growth.

C. Choose a Fund according to risk vs return

• It is fundamental to any investment that higher the risk, the higher are the return.

• Returns have to be compared with risk profile of the fund.

• Consistent returns are the key to build corpus over a time horizon.

• It is important to focus on Risk adjusted returns. A large-cap fund may show good

performance for a short while by adding high-beta stock to its portfolio but during

bad times, the returns may go away.

• While deciding on a fund, it is important to see how well the fund is managed in terms

of preserving value in bad market condition.

• Comparing funds in both rising and falling market is more relevant.

• Protecting value is equally important as earning returns.

D. Fund Performace is only one aspect of your plan

• Let us not forget that we are investing in an insurance plan, the objective of having an

insurance policy is the broader picture rather than judging fund performance.

• What does matter is how well the plan suits you?

• Fund growth rates are not the only criteria to buy insurance. The product features

also play a considerable role in your financial scheme.

• It is of no/ little use if funds of a 20-year policy perform remarkably well in the first 2

years and bad during last 5 years.

• Long-term performance is the true value added to the customer.

• We target objectives of life like retirement, child’s education. We need to see long-

term and thus short-term volatility is irrelevant.

OBJECTION #23 “Fund growth rates are lower than other

companies”

Smart Solutions for

Smart Consultant

By

Product Development


A. Role of IRDA • Functions to protect the interest of policyholders.

• Monitoring insurer and doing audit is one of the primary functions of IRDA, so that

customer’s interest is met and IRDA guidelines are adhered to.

• Regulator is autonomous. It exercises control over insurance companies at every level

- Operation - Formation - Valuation - Reporting.

• IRDA controls not only the Insurer but also its distributors (agents, training and

licensing are regulated).

B. Actions taken by IRDA

• IRDA is regularly coming up with new guidelines on Pension, ULIP, VIP, etc to ensure

customer interest is taken care of.

• IRDA discontinued products of many insurance companies ensuring customer

centricity.

• Less transparent products have undergone modifications. (IRDA has made insurance

companies amend launched products for transparency.)

• The regulation starts even before the sale takes place. A customer has to sign the

Benefit Illustration to avail the policy.

• Regulator has modified solvency report’s frequency from yearly to quarterly earlier.

This ensures a close monitoring of the insurer’s performance.

• IRDA has been successful in sensitizing and educating insurer and public at large on

correct selling and buying of insurance products.

• IRDA ensures that we maintain a solvency margin which is one of the most stringent

regulations to ensure financial health of the policyholder.

• Advertisements and literature (any promotional material) is scrutinized by IRDA.

• IRDA acts as a grievance redressal system.

• Any closure of insurance companies is viewed seriously. IRDA always intervene in

such cases just like SEBI has done for Satyam, RBI has done for Global Trust Bank.

C. IRDA is trustworthy

• IRDA suggests of Trust, Transparency and Technology.

• IRDA is formed by an act of Parliament.

• Till now no scam like Harshad Mehta or Ketan Parikh has taken place in the insurance

industry.

• Globally, the regulators of any statutory body follow the highest standard of

procedural, ethical and transparent methodology and openness.

• I agree that when seen from consumer’s side the biggest issue is one of regulatory

arbitrage. Let me assure you that IRDA is very strict.

• The interest of policyholders of AMP Sanmar (now Reliance), was restored. The

intervention of regulator is instrumental in such cases.

• IRDA is staffed by people who are technically qualified and have quite a rich

experience in the industry.

• “You cannot afford to distrust the regulator. Do you accept a Rs. 10 note not signed by

RBI Governor”?

OBJECTION #24 “Regulatory bodies are not effective”

Smart Solutions for

Smart Consultant

By

Product Development


A. 10(10D) cannot be the sole motive of taking a life insurance policy • Tax free maturity under 10(10D) is only one aspect of life insurance.

• Insurance is a risk mitigation tool.

• Can you afford to remain uncovered or stop planning about your child’s education

just by wondering about the fate of 10(10D)?

• Tax planning cannot surpass your personal financial plan for which, life insurance is a

vital tool.

• Interest on fixed deposits attracts TDS. Have you stopped investing in fixed deposits?

• Functions to protect the interest of policyholders.

B. 10(10D) is extended to promote life insurance

• Since Life Insurance is the most efficient tool for mobilization of money and helps the

economy in “Capital formation”.

• Since India is yet to have a proper social security net, life insurance industry shall be

continued to be patronized by the Government.

• Since, indirectly Government gets revenue from life insurance like service tax, stamp

duty, corporate tax, etc. Thus, removal/ alteration of 10(10D) will impact

Government too.

C. 10(10D) has far reaching consequences

• In case Government intends to bring maturity benefit of life insurance under tax, it

will also not leave benefits under other instruments like Public Provident Fund and

Gratuity from being taxed.

• Insurance contracts are long-term saving and protection vehicle. It is not purely an

investment tool. Thus possibility of imposition of tax on maturity is remote.

• Insurance companies invest a substantial portion in stock market and GOI Bonds. Any

alteration in 10(10D) shall have a negative impact on the same.

• Removal/ alteration of 10(10D) will be a contradiction to the legal provisions of

Married Women’s Property Act.

D. Removal/ alteration of 10(10D) is not a viable option

• As from socio-economic consideration, life insurance will be the last in the list of

direct taxation.

• In a country like India, as Government intends to increase penetration of life

insurance, the idea of removal of 10(10D) does not hold good.

• After Provident Fund, life insurance industry has the largest number of retail

investors. Thus, removal of 10(10D) is the last option that the Government will

consider.

• Till now, no tax laws have come into force in a retrospective manner. Thus, we may

assume that the life insurance policies issued today will not be impacted.

• Even if 10(10D) is removed, entire maturity proceeds cannot be taxed, since it

consists of premium paid by the Policyholder/ life assured also.

• As Insurance industry has greatly helped in the development of capital markets (debt

and equity markets), removal/ alteration of 10(10D) will negatively impact the same.

OBJECTION #25 “What if 10 (10) D is removed/ altered by

Government at the time of policy maturity?”

Smart Solutions for

Smart Consultant

By

Product Development


A. IRDA regulated insurance company

• Government has control over sectors which are privatized. They have specialized

regulatory bodies like RBI for Banks, TRAI for Telecom and IRDA for insurance.

• Solvency Margin needs to be maintained by all the Insurance Companies in India

whether in Private or Public sector.

• We are solvent - solidly solvent, thanks to conservative investment and strict IRDA

regulations.

• Regulation provides a level playing field for all insurance companies. So decision

based on how safe a company is not relevant.

B. Bajaj Allianz alias S.A.F.E

• Stability is what we have proved as Allianz have a vintage of 115 years in insurance

industry providing financial service.

• Accountability is what we hold for our customer segments by providing need based

products.

• Financial Security is what we guarantee you by giving you an access to affordable and

reliable insurance. It will cover the care you need, when you need it the most, at a

price you can afford.

• Efficiency is what is reflecting from our much improved service quality and customer

centric product.

C. You can rely on us

• Bajaj and Allianz both have a track record of long-term market presence in any

venture.

• We understand your insurance needs and provide you a plan that meets your needs.

• Perception is the deciding factor here. Being a private company makes us all the more

responsible and watchful towards policyholder’s interest.

• Private insurance industry in India has tested positive for Growth steroid.

• Why 80C/ 80D/ 10 (10D) benefits are given on policies of a private player like us, if

we were not under proper regulation of Indian laws?

D. Look at the bright side of facts

• Our business philosophy is to ensure excellent insurance and investment solutions by

offering customized products, supported by the advanced technology.

• You should look at the large number of customers who have trusted us with their

money.

• Our number of branches itself proves that we are here to ‘stay’ and not run away.

• Being highly transparent, we have our product brochures and benefit illustration on

website.

• Lacs of customers in 10+ years bears a testimony that BALIC as a brand commands

enormous trust and credibility.

• As from socio-economic consideration, life insurance will be the last in the list of

direct taxation.

OBJECTION #26 “BALIC is a private company”

Smart Solutions for

Smart Consultant

By

Product Development


A. Health Plans are for protection against eventualities and not for return

• Do you ask for return of Doctor's fee after you get well?

• If your objective is Health Protection, you should go for a health plan.

• Financial help when required for health eventualities is better than looking at

returns. Your best return is your peace of mind.

• Health plan is like an invisible shield which lasts in case of emergency.

• You need a plan to cover you against sudden expense on account of medical

emergencies.

• If you insist, I can give you two plans 1) Health 2) Any other investment plan. It will

suffice both your needs.

B. Costs are rising, you need to make provisions today

• Health related costs are rising. Doctors/ Hospitalisation/ medication - costs of all are

exorbitant.

• Do you want doctors and hospitals to take away a substantial part of your savings?

• Health plans have an advantage to protect you against soaring medical costs in future.

• Benefits are higher than costs in a Health plan.

• Health expenses are Unknown and Unexpected, don't make them Unaffordable.

C. Health Insurance is Wealth Insurance

• You should take a health plan because you need it and not because your money

needed a health plan to grow.

• Health eventualities in future will drain away all your money even if you get good

returns.

• Health Insurance ensures that your other saving/ investment tools continue to give

you returns without depleting them.

• Absence of Health plan can upset your financial planning and regular saving in case of

any health eventuality. It’s better to use the returns of your investments/ savings

plans constructively rather than paying for medical emergencies.

• Health insurance is like a vaccine, it is always best to prevent yourself against any

eventuality.

D. Health Plans aim at providing maximum protection at lowest costs

• Health Plans reward you for claim free periods.

• Pre-hospitalization and post-hospitalization expenses.

• TPA - you get help to manage your emergency.

• Offers you Cashless facility. No immediate cash needed.

• Your best return is assured. Treatment in best hospitals by the expert doctors.

• Cost of Quality health service cannot be met just with your earnings.

• Pay small, get Big, protect your health, and increase your wealth.

• Have you saved enough to cover your family against any health eventuality? If not,

you need a Health plan.

OBJECTION #27 “A Health Plan doesn’t give any returns.

Why should I take it?”

Smart Solutions for

Smart Consultant

By

Product Development


NO OBJECTION MOVEMENT

SMART SOLUTIONS FOR

SMART CONSULTANT

Objection Handling Manual - sales.baliconline.in · Objection Handling Manual (Compilation of...

Documents

Transcript of Objection Handling Manual - sales.baliconline.in · Objection Handling Manual (Compilation of...