Your agent’s commission which was eating into the premium of your life insurance policy may come down.
With the Securities and Exchange Board of India (SEBI) abolishing the entry load on mutual fund investments, its insurance counterpart -Insurance Regulatory & Development Authority (IRDA) is examining a similar move, J Hari Narayan, Chairman, IRDA told Hindustan Times.
“However, the charge structure of a ULIP (unit-linked insurance plans) is different from that of a mutual fund,” he said.
ULIPs carry a premium allocation charge that can go as high as 45 per cent, while entry load charges in a mutual fund range between 0.5 per cent and 2.25 per cent.
Insurance industry officials said mutual funds and ULIPs are different, and cannot be treated the same way.
Says US Roy, MD and CEO of SBI Life Insurance, “Insurance and mutual funds are bought for different needs. There may be some insurance companies that may lower the commission charges for ULIPs.”