By Irshad Mushtaq
As an insurance agent, it is crucial to sell insurance products properly, catering to the specific needs of clients. Unfortunately, many agents prioritize their own requirements over those of their clients, focusing more on making a sale rather than providing the best possible solution. The technique of selling is often based on emotion rather than factual information, leading to a lack of clarity and understanding for the customer.
Furthermore, many insurance agents tarnish the reputation of mutual funds, falsely claiming that they are risky and dangerous investments. However, the reality is quite different. While insurance policies offer high commission rates for agents with a minimum lock-in period of 5 years, mutual funds do not have the same constraints.
It is important for investors to be informed and aware of the advantages of mutual funds, such as low-cost expenses, no lock-in period (except for ELSS), and the potential for double-digit returns over a long period. However, due to the high commission rates and lock-in period of insurance policies, agents often paint mutual funds and quality shares portfolios in a negative light, discouraging potential investors from considering them as a viable option.
In reality, mutual funds offer a range of options, including low-risk liquid funds for those who are averse to volatility, and the potential for great returns through long-term investments, particularly through SIPs. It is critical for investors to conduct thorough research and make informed decisions, rather than succumb to the biases and limited perspectives of insurance agents.
Ultimately, every individual should strive to become an informed investor, equipped with the knowledge necessary to make wise investment choices. It is essential to question the motives of insurance agents and take advantage of the wealth of information available, such as through platforms like Google, before making any investment decisions. By doing so, investors can ensure that they are making choices that align with their financial goals and best interests.
- Author is NISM qualified, Mutual Fund advisor and distributor having experience of 18 years in financial market
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