Buying Life insurance is not about trying to oblige your nephew, cousin, friend or your Banker. A lot of life insurance policies become “orphan”  because the Consultant switched his profession or the banker thought his job was over after peddling the product. Says K S B Mani, Consultant – Life insurance at Dr. Insurance, “Selling a life insurance policy is just about 10% of the effort, servicing it quarter-on-quarter, year-on-year requires tremendous amount of focus, dedication and love for this profession”.

When you  buy a life  insurance policy, you are not just buying a product, you are buying a relationship…. Just follow the 7 golden rules and you will know if you are buying from the right source :

1. How long the Consultant has been in insurance business ?

If the person has been selling Life insurance for less than 10 years, try to avoid him. Such a person has not gone through even one policy life cycle and hence you cannot trust him with your long-term commitment.

2. Will the Consultant be in this business for the next 10 years to service you post-sale needs ?

Not sure? move on...do not waste your time. Life insurance should never be bought because your uncle / Aunt has taken up an insurance Agency or your friend’s friend has approached you or because your Banker is pressurizing you. It is safer to donate money when someone approaches you for help than buying a Life insurance policy from him / her.   

3. Does the Consultant understand insurance business ? 

Does he have a professional qualification? Ask him if he completed atleast an AIII program. Having insurance qualification would show his commitment to the profession, his knowledge base and assure you that he understands what he is speaking. That’s the difference between a professional consultant and a pure salesperson.

4. Is the Consultant an employee of a Bank ? 

Says Mani, “most of the recent orphan policies that have come to us were sold by the Banks”. In recent years, Banks have started pushing the products of an insurance company they have a tie-up with. These customers have, over the last couple of years, realized the mistake they have made. Post-sale service is very bad and the customer, in most cases, has to do self-service. Mani adds, "Life insurance purchase is not a one-time transaction. You will have reasons to interact with the insurance company many times after you write the first cheque and that’s when you would need the assistance of the Consultant”. 

5. Ask for atleast three references from people you know.

Seriously, do a reference check. Ask them if they are happy with the product they purchased and how long they have known the Consultant. Reference-check helps.

6. If the ROI looks fabulous, cross-check with the insurance company directly.

If the Consultant is doing a hard-sell and promising the moon, simply ask him to put the “Returns” in writing on the insurance company’s letter-head, sealed and signed. You will never see him again.

7. Brochures / Pamphlets : Never trust them !

Never trust any sales brochures / pamphlets except what is printed on the Insurance Company’s Letterhead, sealed and signed.