01
There are still many people buying insurance nowadays, but some people buy the wrong insurance because they don’t know much about insurance.
I have a friend who made a mistake before. He wanted to buy an insurance at that time, but because he didn’t know much about it, he bought the product from an insurance salesman, and finally bought a financial insurance. However, he later went back to study it carefully and found that financial management insurance could not meet his protection needs at all, so he wanted to cancel the policy.
However, surrendering the policy is not a simple matter.
Everyone knows that early surrender will result in heavy losses, because once the policy is surrendered, what you get is not the premium that has been paid, but the cash value of the policy.
What is cash value? It refers to the value of a life insurance policy with a savings nature.
To put it simply, the cash value of the policy is the personal property of the insured and can be withdrawn from the insurance company at any time. However, few people do this. They often only think of this money when they surrender the policy or are in danger, so we The cash value of the policy is usually called the surrender charge.
Everyone knows that every policy has costs, such as underwriting, document preparation, agent commissions, employee wages, taxes, etc. If the policy is to be surrendered, the insurance company will definitely deduct these costs first.
Moreover, because these costs are generally based on the principle of "high first and then low", a long-term insurance policy will not generate much cash value in the first few years. From this point of view, surrendering the policy is actually very uneconomical.
02
Seeing this, some people must think that I have bought it wrong. If I don’t surrender the policy, it will not be a loss.
It is still necessary to stop losses in time, but the losses have already been caused, so is there any way to reduce some losses?
We can take advantage of the hesitation period and invalidate the policy application. Both of these are good methods, and almost all the premiums can be refunded.
I studied it carefully and found that using the hesitation period would be more effective.
Surrender during the hesitation period means that the policyholder surrenders the policy within the hesitation period stipulated in the contract.
Generally, insurance companies stipulate that the policy holder has a hesitation period of fifteen days after receiving the policy. If the policy is surrendered within this period, the insurance company will usually refund the entire premium after deducting the cost of production. This loss is very small and can almost be ignored. .
However, in addition to surrender during the hesitation period, there is another situation where the policy is surrendered normally.
As long as the surrender exceeds the hesitation period, it will be regarded as a normal surrender. Normal surrender generally requires that after the policy has passed for a certain period, the policy holder can apply for termination, and the insurance company will return the cash value of the policy within the specified time.
Please note that what is mentioned here is the cash value of the surrender policy, not the total premium you paid! Never confuse the two.
03
If you still want to cancel the policy after the hesitation period, it is impossible to get back the entire premium unless you apply for invalidation of the policy.
But applying for invalidation of a policy is not an easy task. You need to have sufficient evidence and sufficient reasons.
For example, the policy receipt, application form , insurance reminder, and risk warning were not copied by you personally, or the signature of the insured was not signed by you, and the insurance company did not call you personally for the follow-up call. The return visit process did not indicate any relevant risks, etc.
Otherwise, even if everyone knows that you were fooled or misled by the salesman, it will be useless. So let me tell you what surrender is? Why is there a handling fee for surrender? How to surrender the insurance without being charged?
What is surrender?
The so-called surrender is one of the forms of terminating an insurance contract and is a basic right enjoyed by insurance consumers. In the first year after the insurance contract takes effect, due to high operating costs (including management fees and risk premiums), the value of the policy is lower than the premium. But over time, the policy will be worth far more than the premiums paid.
To put it simply, it's like you want to open a restaurant. Before opening, you need to rent a store, decorate it, buy equipment, find employees, and do publicity.In other words, before the store is opened, you have to pay various related fees. This is the cost of opening a store, so you can’t do it without paying. After you actually open the store, the daily net sales profit gradually accumulates and exceeds the cost you invested before, and the net income begins. On the other hand, if the store has been open for 10 days or so, you will feel tired of waking up early and serving tea and pouring water, so you will simply close the store and quit. Before that, the cost you invested in the store will naturally not be recovered.
Strictly speaking, the cash value after the policy is surrendered is expressed by the formula:
Therefore, if the insurance period is short, the premium returned to you (that is, the cash value at the current point in time) is entirely possible to be lower than the initial investment. For premiums, as you understand, you can’t even get your money back. Why does
charge a handling fee?
In fact, this standard for deducting handling fees is not unique to insurance companies. There are also handling fees when buying financial products from banks. At the same time, bank financial management is not allowed to withdraw after interest accrues, and the stability of capital operations must be ensured. Therefore, the income we see is the final income balance after deducting handling fees after maturity. When buying a fund, there are also handling fees, including subscription/subscription fees, redemption fees, trailing fees, etc.
When we operate stocks, whether we buy or sell, there will be handling fees. For private equity funds and asset management plan products, there will also be performance sharing, which is both an incentive for investment managers and an intermediate fee cost. This is because, whether it is a bank, fund, insurance, or securities, they are not public welfare organizations. They all need to make profits to pay for labor and operating costs to ensure that they provide better services to investors. Each type of handling fee only has a different deduction method and gives investors a different feeling. The origin is the same. Some are deducted in the front (such as insurance), some are deducted in the back (such as financial management, funds), and some are deducted at the time (stocks).
How to cancel the policy without being charged?
In order to better protect the rights and interests of policyholders, insurance companies have set up a "hesitation period", which means that within 10 days after receiving the insurance contract, if the policyholder does not agree with the contents of the insurance contract, he or she can return the contract to the insurer and apply for cancellation. If you surrender the policy during this period, you will generally only be charged a cost of RMB 10, and no other fees will be charged. Policyholders should make full use of this time, carefully study the policy or a professional insurance agent, and decide whether to insure the policy after careful consideration.
Before configuring insurance, we must study the insurance contract carefully, read the exemption clauses clearly, plan whether the annual premium is affordable, and confirm the priorities of the insurance product types. By mastering the above points, we will be able to find a satisfactory insurance product. Don't be half-hearted when arranging insurance, start it right and finish it right, as long-term mandatory savings. Insurance can provide you with help in times of need, and it can also magnify the number of times to save people in danger, so we must cherish ourselves and not waste time.
Finally, I would like to remind everyone that when surrendering a policy, do not surrender immediately. It is not too late to wait until the new policy takes effect (after the waiting period). After all, during this period, we still need the protection of the old policy.
It is best for everyone to think clearly about what insurance they want to buy before buying it. It is best to get it done at once. After all, surrendering the insurance is always a troublesome thing, which not only loses money, but also wastes your energy and time.
