Here are some clues for you that can help you to understand the particular policy:

1) Hidden Costs/Charges: First of all you should understand that any policy depends on the insurance variant and type and the fee or charges may vary for different policies. Like if you are choosing a policy with a combination of insurance and investment then there is a chance that your agent can generally ignore the allocation fees and administrative charges for the policy that the insurance company can deduct from the amount you deposit. So the first thing will happen that you can lose the money when you purchased the policy with these inbuilt allocation fees and administrative costs. This simply means that when you take any policy then there is a substantial amount has deducted from the paid-money and the rest of money will be used to buy the policy credits from your insurance account.

One more thing you need to know that the allocation fee is generally highest in the first year of the policy term and then reduces proportionally.

2) Lock in Period: This is another feature that the agent/consultant generally doesn’t want to explain to anyone. What is lock-in period? This is the compulsory time for which your money must stay invested with insurance company so as to take advantages of the policy. If there is any emergency in that the buyer wants to withdraw the money then there are many penalties for this that can considerably deduct the net payable amount to the buyer. So before buying any policy you must think if there will be any possibility to withdraw the policy in between and then put in the money.

3) Surrender Charges: The surrender charges of any policy are never declared to you at the time of purchase. The agent generally tells you that the whole NAV of the plan will be compensated to you if the policy is surrendered earlier than its maturity period. However this is not the truth. All companies do charge a fixed surrender charge if the policy/plan doesn’t complete its maturity period. So when you are going to buy any plan or policy then read carefully about the maturity period for the particular plan.

4) Terms and Conditions: There are lots of factors in terms and conditions of the policy that any buyer does not pay any attention to at the time of buying. Though this mistake can actually cause to be the invalid policy or make it very difficult at the time of claim. So read those and ask your agent each and every term of the policy that you are unable to understand when you are about to sign a deal.