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What is the commission the agents get for insurance policy and mutual funds?

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Is it better to deal mutual funds and insurance policies directly? What  percent of our investment goes as commission to the agent?
asked Nov 21, 2010 in Mutual Funds by SAIRA (120 points)   1 1
    

 
 

 

2 Answers

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That varies from company to company and product to product. In equity mutual funds, the upfront commission is 0.5% of the amount invested, while there is no commission in many debt funds.

In general life insurance like car insurance, health insurance, it varies from 5% to 15%.

In life insurance, ULIP commission as per IRDA cap is 5% in first year. In traditional products like endowment & money back, it can vary from 15% - 40%.

All these are general figures. The exact depends upon the amount invested, tenure of investments, company, advisor slab, total business etc.

Also, every company will deduct service tax + TDS viz. 10.3% + 10.3% from the above mentioned amount before releasing commission to advisors.

Hope it will help you.
Admin
http://www.InvestmentKit.com
answered Nov 21, 2010 by admin (47,400 points)   5 7 12
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Sorry, just missed the 2nd part of your question.

It will be difficult to make and manage your financial portfolio without any guidance. You can have an idea of financial literacy from different media like websites, TV, magazines etc., but  when the times comes for actual planning, only personal financial planner can help you.

Just forget how much commission, they are getting from the company and never think of asking for commission pass-back from them. That way you'll spoil your relationship and ultimately your portfolio. If we're comfortable in giving fees to doctors, school fees etc., why not fees to financial advsiors.

I would suggest you to hire a independent professional financial advsior. Sit with him / her and discuss your financial goals. Understand the plan before signing the application forms. If got doubt, discuss on forums like this and trust him.

Do not consider bank advisors, who are generally employees & are always looking for their targets and incentives.

Hope it will help you.
Admin
http://www.InvestmentKit.com
answered Nov 21, 2010 by admin (47,400 points)   5 7 12

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