Because you have come to know what is life insurance, now you should know about the major types of life insurance plans:
- Term Life Insurance Plan – Pure Risk Cover
- Unit Linked Insurance Plan (ULIP / ULIP) – Insurance as well as Investment Opportunity
- Endowment Plan – Insurance and Savings
- Money Back – Periodic returns with insurance (periodic returns)
- (Whole Life Insurance) – Whole Life Coverage for Life Assured / Whole Life Coverage for Insured
- Child Plan (Children’s Plan) – Children’s life goals (Jeevan Dhyaya) like education and marriage
- (Retirement) Plan – Income after retirement
Let us know further and understand the specifics of each life insurance plan.
- Term Life Insurance Plan
Term life insurance plan is the purest form (pure form) of life insurance (life insurance). It provides you a life cover with no saving or profit elements (elements). Term life insurance plans are the most economical type of life insurance as its premiums are quite cheap compared to other life insurance plans. It is the most pure form (pure form) of life insurance (life insurance).
- Unit Linked Insurance Plan (ULIP / ULIP)
A unit linked insurance plan is a complete mix of investment and insurance. A portion of the premium paid for ULIP plans is used as a risk (insurance) cover and a portion is invested in various funds. Depending on the risk tolerance (risk appetite) of the policyholder, they can invest in various funds offered by the insurance provider (provider). The insurance providers then invest the money collected in various money market instruments such as shares and equities.
- Endowment Plan
Endowment plan is a traditional (traditional) life insurance (life insurance) policy which is a mixture of insurance and savings. In an endowment plan, if the life assured means that the insured wins more than the policy period, then the insurance company provides the maturity benefit (maturity benefit) to the policyholder. In addition some endowment plans may offer periodic (periodically) bonuses that are paid either on maturity or in case of premature death of the policyholder.
A money back life insurance plan is a unique type of life insurance policy in which a portion of the sum assured (sum insured) is paid directly to the insured person at regular intervals as a survival benefit. In this way, the policyholder can achieve short-term (short-term) financial objectives.
- Whole Life Insurance
Whole life insurance plans cover the life assurance (insured) for the entire life, or in some cases up to the age of 100 years. At the time of purchasing a whole life insurance plan, the sum assured is determined. A nominee (nominee) is mentioned during the purchase. In case of any unfortunate event, they are paid Death Claim and Bonus, if applicable.
However, if the life assured (the insured) survives more than 100 years, then the insurance provider gives the life insurance the same maturity benefit as the endowment corpus (amount).
- Child Plan
The goal of child life insurance plan is to create a collection (amount) for the future development of the child. Usually it helps to provide money for education and marriage of a child.
Such a plan provides instalments annually or pays a lump sum after the major milestones (halt) of a child’s life. If the insured foster premature death (untimely death) occurs during the policy term (term) – then all future premiums are waived and the policy benefits (benefits) continue without interruption.
- Retirement Plans
Retirement life insurance plan helps to build a stable (stable) financial source (financial source) for a person’s retirement (retirement) years. It helps to make a person financially independent (financially independent) and helps them to live without worry. Most retirement life insurance plans offer an annual payout (in the form of an annuity / annuity) or a one-time lump-sum payout (through the commutation / conversion of the accumulated limit / amount collected up to the prescribed limit) on completion of 60 years.
In case of a possible event during the policy term, the insurer pays the insurance benefit (insurance benefit) to your family.
What are the Benefits of Life Insurance Plan?
After knowing about the meaning and type of life insurance (life insurance), you should know about the 3 major benefits of taking a life insurance policy. The 3 major benefits of a life insurance policy are:
Life is unpredictable and can be full of uncertainties. It is difficult to reduce the likelihood of an unfortunate event like death. In such situations, the family has to face financial troubles due to a continuous income (income) deficiency.
Investing in a life insurance policy from the very beginning in life acts as a protective shield in the event of such a possible event. The Life Insurance Provider is obliged to pay the Sum Assured (Sum Insured) in advance to the nominee (nominee) or the beneficiary (beneficiary). As a result, his family is protected even if the policyholder is not there.
- Long Term Saving
If one wants to make a long-term investment (long-term investment), it is important to consider life insurance. Such insurance plans help you in performing systematic savings and creating a corpus (zodiac) that can be used for many reasons such as building a new home, good education for your child and the expenses of the child’s wedding Providing funds for
Not only this, some life insurance policies offer monthly pay-outs in the form of annuities, which is an ideal way to target and achieve retirement goals.
- Investment Options
Life insurance providers offer unit linked insurance plans (ULIPs) which are primarily investment instruments.
These market-linked life insurance products provide significant benefits during maturity, hence making this ULIP a reliable investment tool.
Insure to be safe
Buying a life insurance policy is a necessity of our time. While many people buy different types of life insurance plans, not everyone is aware of the many benefits (benefits) offered by it. In your absence, a life insurance policy helps your family in difficult times and provides financial help to them.
Founder & CEO| Fox Investor – Financial Blog Portal & A.V.A. Taxway Associates- Corporate & Tax Law Firm
Dr. Viibhor Agarwal has a Ph.D. in IPR, start-ups, and corporate law, as well as an MBA in finance from NMIMS Mumbai, and achieved numerous certifications in corporate law. He is a practicing corporate lawyer and the founder of two business verticals. He has advised over 2000 businesses, 5000 students, and 400 new start-ups all over India and other countries like Dubai, London, the USA, and Qatar. Dr. Viibhor Agarwal assists people with business expansion and branding, regardless of size, as well as business setup, financial literacy, start-up guidance, licensing, tax planning, and other legal compliance issues. Dr. Viibhor Agarwal’s goal is to provide complete financial and business literacy to all businessmen who want to start new businesses and grow existing businesses and to those students who want to open their start-ups. In each video, Dr. Viibhor Agarwal not only explains the method of the solution but also advises subscribers on practical tips learned from and faced by clients handled by Dr. Viibhor Agarwal daily. This blog portal provides you with an easy and clear solution to your business problem, allowing you to take your business to the next level.