Financial Products

Transactional Products

Bank deposits and other savings instruments that enable one to have adequate purchasing power (Liquidity) at the right time and quantum

Contingency products like insurance

These provide protection against large losses that may be suffered in the event of sudden unforeseen events.

Wealth accumulation products
Shares and high yielding bonds or real estate are examples of such products.
Here the investment is made with a view to committing money for making more money

Life Stages

Childhood stage 
When one is a student or learner

Young Unmarried stage
 When one has begun to earn a livelihood but is single

Young Married stage
When one has become a partner or spouse

Married with young children stage
When one has become a parent

Married with older children stage
When one has become a provide who has to take care of education and other needs of children who are growing older

Pre - retirement stage
 when the children may have become independent and left the house

Retirement stage
when one passes through the twilight years of one's life

Financial Planning

• It is  process of identifying one's life goals, translating these identified goals into financial goals and managing one's finances in ways that will help one to achieve those goals.
• Is a process through which one chart a road map to meet expected and unforeseen needs in one's life 
• Is taking actin to turn one's goals and desires into reality
• Takes into account one's current and future needs
• The best time to start financial planning is right after one receives the first salary.

Types of Goals

1. Short Term : Buying an LCD TV Set or a family vacation
2. Medium Term : Buying a house or a vacation abroad.
3. Long Term : Education or Marriage of childrens and post retirement provision

Legal Principles of Life Insurance

Proximate Cause

• It is defined as the active and efficient cause that sets in motion a chain of events which brings about a result, without the intervention of any force started and working actively from a new and independent source.
• In general, since Life Insurance provides for payment of a death benefit, regardless of the cause of death, the principle of Proximate Cause would not apply. It applies only to Riders.

Adhesion Contract

Drafted by the party having greater bargaining advantage, providing the other party with only the opportunity to accept or reject it. Here the Insurance Company has all the bargaining power. To neutralize this free look in period is offered to policy holder.

Free Look Period - 15 Days

1. free-look period has been introduced whereby a policyholder, after taking a policy, has the option of cancelling it, in case of disagreement, within 15 days of receiving the policy document.
2. The company has to be intimated in writing.
3. Premium paid is refunded less expenses & charges.