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Should I surrender or continue Jeevan Saral policy?

Such insurance-cum-investment plans typically offer a very small insurance cover and they also offer very modest returns

My Jeevan Saral policy has completed 6 years. Please advise whether I should surrender or continue policy.
- Ravi Teotia

LIC Jeevan Saral is an endowment policy which is silent on its expenses just like other plans in this category. Though you will make losses upon surrender, it is not wise to continue investing in a bad product. Such insurance-cum-investment plans typically offer a very small insurance cover and they also offer very modest returns. Do not mix your insurance and investment needs in future. Always buy a pure term life insurance to buy an adequate life insurance cover. Term insurance products are ideal to buy a large insurance cover because they have very low premiums.

You should go for equity mutual funds to fund their long-term goals of five years and above. Equity has the potential to offer better returns than other assets over a long period.

If you are a new comer to the stock market, choose a top-rated balanced scheme and start investing every month via a Systematic Investment Plan (SIP). If you are familiar with the stock market, you can invest in a diversified equity scheme. You must continue with your SIP investments irrespective of the market conditions. This will help you to average your purchase cost and enhance your returns.

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