Benefits of participating in life insurance

(Baonghean) - With the aim of preventing unforeseen risks, many people have chosen to participate in life insurance. However, due to lack of thorough research, many customers do not really understand their rights when participating.

Concerns from customers

At the end of May 2017, Nghe An Newspaper received a complaint from Mr. Nguyen Van Ty (Xuan Long village, Thanh Chi commune, Thanh Chuong district) about his family's dissatisfaction with the payment of money to customers of Bao Viet Nhan Tho Tay Nghe An Company (headquartered in Yen Quang hamlet, Yen Son commune, Do Luong district).

Mr. Ty stated: his wife - Mrs. Nguyen Thi Xuan participated in insurance of this company from December 23, 2006 with the original insurance amount of 10 million VND and he was the insured person. The term of the insurance is 12 years, from December 23, 2006 to December 22, 2018. According to the contract signed between the two parties, Mrs. Xuan is obliged to pay the insurance premium periodically every year, once a year on December 23, with the insurance premium amount of 1,698,000 VND per period.

Bao Viet Tay Nghe An Life's records record Ms. Xuan's insurance premium payment process. Photo: Phuong Thao

The contract clearly states the benefits when Ms. Xuan participates in insurance. Photo: Phuong Thao

On December 28, 2016, Ms. Xuan passed away due to sudden death. Up to this point, Ms. Xuan has paid the insurance company 11 times periodically with a total amount of 18,687,900 VND. After this accident, Mr. Ty's family was paid 20,010,300 VND by the insurance company, including the contract's increased insurance amount of 15 million VND and the periodic insurance benefit of 5,010,300 VND. With this amount, Mr. Ty said that his family bought insurance but when the accident occurred, they did not receive the insurance benefits.

The news that Mr. Ty's family had purchased insurance but did not receive support money when they encountered risks made many people in Thanh Chi commune confused and worried. Mr. Song (Xuan Long village, Thanh Chi commune) shared: "My family bought 2 insurance contracts, in our commune there are also many people who buy insurance from Bao Viet Nhan Tho. The case of Mr. Ty and Mrs. Xuan's family not being paid properly by the insurance makes people in the area very worried."

Coming to Bao Viet Nhan Tho Tay Nghe An Company, the person who directly worked with the reporter was Mr. Tran Duc Ngoc - Deputy Executive Director of the company and Mr. Le Duc Hanh - Head of Customer Service Department of the company. Here, they both confirmed that Bao Viet Nhan Tho paid Mr. Ty's family a total amount of 20,010,300 VND in accordance with the provisions of the contract.

Ms. Nguyen Thi Xuan participated in the An Gia Tai Loc insurance package of this company with contract number 03805200030881. For this insurance package, the insured will enjoy 2 types of benefits.

Firstly, from the second year onwards, the insurance amount of the contract will be calculated to increase by 5% on the original insurance amount (10 million VND), meaning that each subsequent period, Ms. Xuan will receive an additional 500,000 VND.

Second, Ms. Xuan will have 3 periodic insurance benefits on December 23, 2009, December 23, 2012, December 23, 2015 with the amount of 2 million VND each time; if Ms. Xuan does not receive this amount, it will be accumulated according to the actual investment interest rate that Bao Viet achieves annually.

In case the customer encounters a risk after 12 months from the effective date of the contract, Bao Viet is responsible for paying the increased insurance amount and periodic insurance benefits up to that point.

Thus, if the customer has an accident on the second contract anniversary (December 23, 2007), they will receive 10,500,000 VND, although up to that point they have only paid 3,396,000 VND in insurance premiums. Similarly, the amount is increased each period and after 3 years they will also receive an additional periodic insurance payment of 2 million VND/time.

In Ms. Xuan’s case, the risk occurred in the 11th year, near the end of the contract. Therefore, the amount Ms. Xuan paid was quite large (18,687,000 VND), but according to the contract terms, Ms. Xuan was only entitled to the 2 types of benefits as above.

Firstly, the insurance premium increased by 15 million VND because at the time of Ms. Xuan's death, the contract was in effect for 10 years and 5 days. Secondly, regarding the insurance benefits, of the 3 times she received money, Ms. Xuan received 1 time on December 16, 2011 with the amount of 2,359,900 VND (accumulated from December 23, 2009). Currently, Ms. Xuan has not received the insurance benefits for 2 times on December 23, 2012 and December 23, 2015, the accumulated interest will be increased from 4 million to 5,010,300 VND.

Thus, the total amount of money that Mr. Ty and Mrs. Xuan's family received was 20,010,300 VND (paid by Bao Viet after Mrs. Xuan's death) and 1 time of receiving insurance benefits of 2,359,000 VND before. Comparing with the terms of the contract signed by both parties, it can be seen that Bao Viet Nhan Tho Tay Nghe An paid benefits to customers in accordance with all terms.

Mr. Nguyen Van Ty expressed concern about the amount of money Bao Viet Life paid. Photo: Phuong Thao

Need to carefully study the contract

Mr. Tran Duc Ngoc - Deputy CEO of Bao Viet Nhan Tho Tay Nghe An Company said: Currently, there are many different insurance packages that customers can participate in; each insurance package has its own contract terms and customer benefits. In the case of Mr. Ty's family, Mr. Ngoc said that Mrs. Xuan died near the end of the contract, when the amount of money she paid was quite a lot, so the difference in the amount received was not too large.

Mr. Ngoc also cited a recent unfortunate case to clearly show the insurance benefits of participants. Mr. Nguyen Van Son (born in 1971, from Dai Son commune, Do Luong district) - the victim of a murder that occurred at a tea hill in Anh Son district on May 24, 2017, he participated in the company's An Phat Hung Gia insurance package.

At the time of the accident, he had only been insured for 8 days and had paid 5 million VND. However, according to the terms of the contract he signed, the company had to pay his family a total of 150 million VND.

The signing of an insurance contract must be agreed upon by both parties, the contract must be recognized by law and when any related problems arise, the settlement of benefits must comply with all signed terms. If the insurance company makes incorrect payments to the customer, it will be subject to penalties under the provisions of the law. In the case of Mr. Ty's family, the payment was made correctly.

The concerns of Mr. Ty's family and the worries of local people are due to a lack of understanding of insurance contracts. Therefore, before participating in insurance, people must learn and carefully study the terms of the contract to clearly understand their rights in all cases and choose the appropriate insurance package.

Phuong Thao