How I lost my sleep over an insurance policy

When I signed on a relationship, tangentially, with Citibank three years ago, I didn't anticipate this at all. After all, I thought, it came with an impeccable global reputation.

Perhaps the fault lay with me. Despite being a Commerce graduate, despite having done a spot of CA articleship before becoming a journalist, I refused to invest in the stock markets although everyone around me made merry as the Sensex was preparing to take off. Probably it was in a moment of weakness that I let Citibank's Sunil meet me in the office about investing in a Birla Sun Life policy-cum-SIP (systematic investment plan).

Sunil was suave and sincere, two qualities that middle class folk like me unfortunately rate over other valid parameters. He had come fully prepared to paint a rosy picture of my financial future, if...

It was quite simple, really. Invest Rs 60,000 a year in the Birla Sun Life scheme under its Enhancer plan, and in 15 years at the then-existing Sensex levels (it was around 8,000 points then) the investment would make me a rich man indeed. If the Sensex went up to 10,000 points, it would be so much better, and if it went up to 12,000, man... You get the picture. Our money will be invested 70:30 in equity and debt, to balance out the risk factor.

Sunil had come with graphics, PowerPoint presentations, printouts, the works.

Looking back there were so many things I could have asked the suave Sunil who had by now started calling me on my cell phone, and visiting me at home to sell the plan. But I guess I was stupid, and raised a couple of points, what I thought then were critical.

I can't pay Rs 60,000 in lump-sum. And what happens if the market tanks? Very middle class questions, you will realise. And Citibank's Sunil had his answer ready.

The policy comes with a 3-year lock-in period, and we are free to walk away any time after that and we will be returned our investment plus 3 per cent interest, he said.

And we don't have to invest Rs 60,000 at one go. Citibank would provide us (yes, listening to the rosy picture, my wife too decided to invest separately) a gold credit card, it will pay Rs 60,000 to Birla Sun Life every year, which will be recovered from us @ Rs 5,000 a month each.

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Seemed fair, and we bought into it. Soon after the Sensex started soaring, and we were happy that we had made at least one sensible financial decision/ investment, that someone else was investing our money wisely for us.

The first bummer came at the first renewal of the policy. Imagine our shock when we found Rs 120,000 (remember my wife too had bought one policy) as the amount due on our credit card statement at the end of the first year. I spoke to Citibank and told them their Sunil had told us we will be charged only Rs 5,000 per month and not asked to pay our premium at one go. And their answer was illuminating.

No, they said, that was applicable for only the first year; the second year on we are expected to pay Rs 60,000 per policy at one go. Frantically, I managed to trace Sunil, told him this went against his assurance to us, and somehow got Citibank to heed us. Ok, you can pay the amount over 12 EMIs, they agreed.

But, the next month on a penalty for this 'late payment' started appearing on our credit card statement, as a trickle initially, and no amount of remonstrating with call centre executives could shake it off. Today, after we have surrendered the card after paying off the legitimate dues, this amount is a bomb.

In the meantime part of our house burnt down, and among the things lost were our Birla Sun Life policy documents. And by the time we restored our home, got back documents like passports, PAN cards etc, it was into the third year of the policy. The Sensex had peaked in the meantime and was slowly returning to earth.

Shucks, we said, our investment must have done really well, there is something to look forward to after such gloom. We got duplicate policy documents done, got online access to our policy and decided to check out our NAV (net asset value).

Imagine our horror when we found that despite the markets booming, and despite the crash the Sensex was still higher than what it was when we got on, we had actually lost money! Even today, the Sensex is almost double what it was when we started on the Birla Sun Life policy.

We realised we had been sold a rotten lemon by Citibank, and decided to exit the policy at the end of three years. At least we will get our investment of Rs 360,000 (Rs 60,000 x 3 years x 2 of us) plus 3 per cent interest.

And once we terminate the policy, why do we need the Citibank gold card either! So we wrote to the bank that never sleeps asking them not to renew our card at the end of three years.

Now comes the best part. We got our money back from Birla Sun Life, but not Rs 180,000 plus 3 per cent each, but Rs 130,000 each. My wife and I had lost Rs 50,000 each, because we decided to trust a suave and sincere sounding Citibank executive. If we hadn't, and let our money sit idly in our bank accounts, we would have been better off!

As middle class people what can we do but shrug, be happy that we didn't lose the shirt on our back, and move on?

But Citibank is not one to give up easily, if it was it wouldn't have its tentacles all over the world would it?

I still get a monthly credit card statement from it even though the bank's customer care replied to my letter expressing sadness at our decision to part ways.

And, I still get collection agents ringing my doorbell, speaking on the intercom from the lobby asking me pay up the outstandings on my card. Once I asked them, out of curiosity, what was the amount pending according to Citibank since I had paid all my legitimate EMIs before terminating the card?

Rs 6,000, sir, he said. They sent you to my house to collect Rs 6,000, I asked the collection agent in wonder. Just Rs 6,000!

This month, out of curiosity I opened the latest credit card statement from Citibank which comes home despite me not possessing their credit card, and was shocked to find out that it demanded 'immediate payment' of Rs 137,454!

Truly, I can vouch for the fact that Citi not only never sleeps, it also ruins your sleep.