HDFC Bank — Erosion of Investment in HDFC LIFE WEALTH MULTIPLIER - ULIP

Address:

Bangalore, Karnataka

I was promised that a minimum 10% growth will be there annually on the premium amount I pay under this HDFC Welath Multiplier scheme and I shall also get Insurance cover. The branch manager recommended that this is one of the wonderful schemes and I was looking forward that this investment would grow to meet my daughters's education and other family related expenses.

I invested in HDFC Wealth Multiplier scheme and remitted Rs. 7.5 lakhs.

Now I find that my investment has erorded. Current value is around 6.2 lakhs and without any return, I see I have lost 1.3 lakh rupees.

I want to get out of this scheme, but again I am going to lose another 1-2 lakhs as surrender charges.

I would have been in better position if I had kept this amount in my SB account rather than put this amount in such blade schemes.

I registered with IRDA - grievance application No is: [protected]

I got a call from HDFC on 7th Nov and I put forth my case as to how I am losing my PRINCIPAL (hard earned money) in their BLADE Scheme. Till date I havent seen any increase in the fund value. Now the fund value is 7.29 lacs a erosing of 0.21 lacs and further one can see a notional loss ( no interest). The only upside is that there is an insurance of 12.5 lacs.

Further I am asked to do fund switch, which doesnot guarantee me even SB rate of interest on the funds I have deposited with a Fund House which has been winning awards continuously on this front.

The 7.5 lacs I have deposited with them is being treated as a premium for a Policy of 12.5 lacs. I dont understand the logic. For a 12.5 lac insurance the premium per annum cannot be more than Rs.8000/- from any of the Insurers. So if one takes out Rs.24000/- for the Insurance premium the rest of the amount 7.26 lacs cannot be treated as premium in any circumstances.

Thus it is obvious that HDFC is camouflaging the scheme under the guise of Insurance policy and siphoning out the Principal deposited with the bank and refusing to refund the amount and mentioning application of the surrender charges as is applicable to an Insurance Policy. This is an UNFAIR BUSINESS PRACTISE by an lengths.

My point above is completely proved that the HDFC Life is making profit at the cost of Public. Kindly verify the news report of Times of India dated 3rd December 2012 and the link to the article is : http://timesofindia.indiatimes.com/business/india-business/Lapsed-plans-drive-insurers-profits/articleshow/1745652...⇄ Some of the relevant portion is as follows:

" Of the total profit after tax of Rs 242 crore for six insurance companies, Rs 163 crore was lapsed profit. The ratio of lapsed profits to profit after tax has been the highest for HDFC Life (188%) and lowest for SBI Life (9.4%).

Industry insiders say that the high level of surrenders are an outcome of the mis-selling the policies"

Further my humble suggestion is that this scheme has two components one Insurance and another Investment. For the Insurance policy there can be two options for the benefit of Public or the ones who have got stuck with such Principal eroding schemes:

i. Define the premium for the insurance policy (allocate the same) and apply the surrender charges if required for the Insurance policy on cancellation. For the remaining amount (Investment) the exit option as is applicable to a mututal fund can be applied.

ii. If the investor wants to continue with the insurance the same can be enabled.

I sincerely request you to help me in getting the refund of the amount deposited by me ( current fund value of 7.29 lacs) and reduce my losses further.

Kindly help investors (poor) like us who are being made poorer day by day by such schemes.

Kindly treat this as SOS.