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In this age of advertisement the people tend to place a great deal of trust in the advertisement content which is packaged so attractively that they commit the cardinal mistake of not making appropriate verification on the tall claims made in these advertisements. As a direct outcome of this, many of them feel cheated and helpless. So next time you come across a glitzy ad, do not rush to commit yourself and exercise due diligence in deciding on your choice and read the fine prints of any advertisement. For instance, you go through the advertisement of New Fund Offer of a mutual fund house, the text is so catchy with all their attractive features are printed in bold and big letters but the most part of them is tucked way in very small prints that all returns of your mutual fund schemes are subject to market fluctuations and I am sure, most of the mutual fund investors are likely to gloss over the fact. Recently I had an interesting experience

involving one of my friends. And here it goes!

 

My friend took out an insurance policy on his life with a private insurance company. The policy term was for fifteen years and he was regular in his payments of premia for the last seven years and now certain financial emergency is compelling him to surrender the policy. But much to his dismay he discover that surrender value of the policy works out lower than the value of premia he has deposited. Being a person with little knowledge of the nitty gritty of insurance world he came to me and literally dragged me to the office of the sales manager of the insurance company. The gentleman gave him a patient hearing and tried to reason with my dear friend explaining the impact of his decision on the insurance company. But my friend would have it none! He quite volubly argued with the manager and curtly asked for an explanation as to how his investments could shrink.

 

Finally the manager played his trump card by asking for the policy document and seized on the relevant page and pointing to the 'surrender clause' of the policy which was quietly sitting on the page. And the accompanying excel sheet showing the surrender value in 7th year to be less than the premium value- a fact which friend came to know first time in long seven years while the document was lying with him all along. Coming out of his chamber I could not help feeling a tad sad about friend look at his disheartened self. But this is the price one must  payfor not reading a text between its lines!

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