1 Life Insurance
1.1 What is Life Insurance
1.2 Type of Insurance
1.3 Endowment Policy
1.4 Term Insurance Policy
1.5 Whole Life Insurance Policy
1.6 Money Back Policy
1.7 Unit Linked Insurance Plan
1.8 Child Insurance Policy
1.9 Pension Plans
Life Insurance Policy is the safest way to protect the insured (policyholder) family or dependents from financial accidental disasters that occur after the unfortunate event of the insured’s untimely death. Who knows what has happened in today’s crowded life? In such a situation, if we have done the insurance of our valuable things properly then it works like financial help for us and our family. Life insurance in our country, under its contract, assures the insured of a certain sum to be paid to his family upon his death during the policy period. This helps the family of the policyholder to cope financially in this difficult time.
What is Life Insurance?
Life insurance is an agreement between an insurance company and a policyholder, under which the insurance company gives a predetermined amount at the time the policy is completed, and if the unfortunate event of premature death of the policyholder occurs during the policy period, The insurance company guarantees the payment of a certain amount to the nominated beneficiary’s family.
These payments may vary from policy to policy. The policyholder agrees to pay a pre-determined amount as a premium, monthly, semi-monthly, annually or lump sum. Certain other things defined in the contract, such as funeral expenses, may also be a part of the benefit. In addition, the insurance company may also trigger some other contingencies involved in the contract, such as serious insurance or terminal insurance, payment of benefits. Therefore, before taking an insurance policy, we should get a good idea about the policy.
Type of Insurance
- Endowment Policy
- Term Insurance Policy
- Whole Life Insurance Policy
- Money Back Policy
- ULIP – Unit Linked Insurance Plan
- Child Insurance Policy
- Pension Plans
This policy offers the benefit of both insurance and investment. A certain portion (amount) of the premium is allocated for insurance, while the remaining portion is invested in the form of asset market equity and debt. The policy is paid a lump sum after the completion of the policy term or upon the death of the policyholder, whichever is earlier. The endowment policy periodically declares bonuses, which are paid, either at the completion of the policy term or upon the death of the insurance holder.
Term Insurance Policy
In this run-of-the-mill life span, a term plan is the simplest, cheapest and remunerative insurance plan, designed to provide financial security for a specified tenure, with a duration of 15 to 30 years. Term insurance ensures that after the unfortunate event of the insured’s untimely death, his family gets a large sum of money to live a financially strong life, they do not have to spread their hands to anyone. However, if the policy period does not happen to the insured, then the insurance company does not give anything as per their contract. The best thing about a term insurance policy is that its premium for insurance cover is very low. After that, we must make a term insurance policy to protect your family.
Whole Life Insurance Policy
Whole life insurance policy provides insurance cover for the entire life of the insured or up to 100 years (whichever is earlier) with the dual benefits of insurance and investment. In addition, the life insurance company calculates the bonus on the insurance amount, which is given to the policyholder or Nominee after his death.
Money Back Policy
In a money-back policy, a partial payment is made during the tenure of the policy as per the contract between the insurance company and the policyholder. In the event of the unfortunate event of the untimely death of the insured, the insurance company lumps the payment of the entire insurance amount along with lifetime benefits as per its policy contract.
ULIP – Unit Linked Insurance Plan
In ULIPs, a part of the policy premium goes towards providing life cover, while the remaining part is invested in equity and debt. Investment in ULIPs is subject to market volatility. There is also a risk. Investing in ULIPs creates a habit of saving regularly in a person. So far according to the thinking of many people, the ULIP plan is not much beneficial. People have less interest in it than before.
Child Insurance Policy
Nowadays inflation and rising education costs are causing uneasiness among parents. Therefore, to give a safe life to your child even in your absence, investing in a good child insurance policy is the best option. The child insurance policy provides a lump sum to the beneficiary (ie child) upon the death of the policyholder. But the policy does not end here. In such a situation, the life insurance company waives all future premiums and continues to pay the child money at intervals planned by the policyholder.
Pension plans are offered by life insurance companies so that individuals can lead a better life after retirement. This money helps a person to live a financially secure life even after retiring. In case of the unfortunate death of the policyholder, the nominee can either take a lump sum or receive a regular pension for the remaining policy term. Most life insurance companies in India provide detailed plans for people to save after their retirement.
Life Insurance Companies in India
Currently, there are many companies that sell life insurance products in India. Of all these companies, the only insurance company under the public sector is LIC. The rest of the companies are either private insurance providers or joint ventures between national or international insurance/finance companies and private or public sector banks / financial institutions.
Final Wording before taking an insurance policy
The Government of India had allowed private life insurance companies to serve in the life insurance sector in the year 2000. In addition, most private insurance companies have partnered with international insurance holders to bring their insurance venture up. Plase, take Your financial advice before investing in any plan.
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