Often asked questions and their answers

else was about extricating oneself from legacy insurance policies. These policies are characterised by poor returns, inadequate coverage and lack of transparency. While this is true of practically any product (except term insurance) of the Indian insurance industry. LIC’S giant legacy products are the biggest offenders.

Beyond insurance problems, the biggest area of concern is what one could call clarification and reinforcement of the very basics. Are systematic investment plans (SIPS) always better than lump sum investments? Why should one invest in equity mutual funds instead of directly investing in stocks? Are liquid funds better than bank fixed deposits? Should one buy lots of funds or only a few? And so on.

These are basic questions, and it’s only appropriate that they should have the widest interest. Anyone who is interacting with investors know that while even shallow understanding of issues is not common, it’s not for lack of trying. Investors are desperate for quality information and guidance and often don’t chance upon a reliable source. The problem of financial literacy in India remains a relatively intractable one. INDIA WITNESSED two significant milestones in the history of its telecom revolution last week. The first was the number of mobile connections in India, which crossed one billion. To be sure, this does not mean one billion people are connected, but even half that number is significant enough by any global standards.

The second event was the launch of services by Mukesh Ambani-led Reliance Jio. The launch of the service is only for Reliance Industries employees for starters. We can expect visible fireworks circa April. The arrival of 4G services in the country means that the elder Ambani jumps into a mature market in which connectivity is not the real issue, but how the overall business model works.

As a late entrant, Jio is at a disadvantage, but every sensible