Types of Life Insurance Policy
At present, if you talk about financial investment, there are many options available today. Most of the people focus on how to create more wealth with their money and sometimes they compromise about the safety of their investments. In present times due to rising inflation, change in lifestyle and nuclear family, financial security for future has become very essential. Keeping this in mind, every person must think about buying a life insurance product. This article discusses about the different types of life insurance policies that you can choose according to your requirement. So that there is no hindrance in your future financial needs.
- Term Life Insurance
Term life insurance is a type of life insurance that provides death benefit to the nominee of the insured in the event of his/her death. This death benefit is given to the nominee only if the life assured dies during the policy term. If the policyholder survives till the end of the policy term then Term Life Insurance does not provide any benefit to him.
Currently, many insurance companies are now offering term life insurance plans in which the premium paid by you is returned if you survive the policy term. Hence, by opting for a term life insurance plan with return of premium, you can get the benefits of term insurance as well as investment returns.
The premium for term insurance is very low as compared to other insurance products and the insurance cover provided by it is also high. So, if you want to protect your family members from financial troubles in your absence, then you can buy a term insurance policy.
- Whole Life Insurance
Whole Life Insurance insurance plans provide you coverage for a lifetime. If you pay the premium on time, this plan provides you cover till you are alive. In Whole Life Insurance policy you also get cash value which increases with time. You can withdraw this cash value as per your convenience or take a loan against its security.
Hence, this insurance plan is very beneficial for individuals who want life insurance cover for their entire life and are also looking for investment options. This can be a very profitable investment for such individuals.
- Endowment Insurance Policy
An endowment insurance policy is a form of life insurance. This policy provides life cover to the life assured as well as helps the policyholder to save regularly over a specified period of time so that he/she is eligible to receive a lump sum amount at the end of the policy term. This policy is beneficial for people who not only want life cover but also want to convert their savings into investments on a regular basis.
- Money Back Insurance Policy
Money Back Insurance Policy provides you money during the policy term. In this, a fixed percentage of the sum assured is paid to the life assured at regular intervals during the policy term. If you pay your premiums on time for the entire term of the policy, then at the end of the policy term, after deducting the amount given to you, the remaining part is provided to you along with the bonus.
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If the life assured dies during the policy term, the amount is paid by the life assured to the nominee. Money Back Insurance Policy is one of the costliest insurance options as it provides returns to the policy holder during the policy term along with bonuses.
- Savings & Investment Insurance Plans
Savings & Investment Insurance Plans Insurance plans give you the option of providing a lump sum amount for the future expenses of you and your family. These plans provide a tool to meet your short term and long term financial needs. Through this you can secure your family financially through a fixed amount of insurance cover. These plans cover both traditional and unit linked plans.
- Retirement Insurance Plans
Retirement Insurance Plans assure you of providing income after retirement. This type of plan is called Retirement Insurance Plan. These insurance plans help you build a retirement corpus. Through the fund that is created on the maturity of this policy, you are provided with a regular income after retirement, which can be understood as a pension or annuity.
- Unit Linked Insurance Plans (ULIP)
Unit Linked Insurance Plans (ULIP) life insurance plans provide you the benefits of both investment protection and flexibility. This insurance plan offers you a combination of insurance and investment.
The premiums paid in this policy are used to purchase units in investment assets chosen by the policyholder. In this insurance plan, the cash value of the policy keeps on changing according to the current net asset value of the investment assets.
- Child Insurance Policy
Child Insurance Policy is a savings as well as an investment plan. Through this you can meet the future financial needs of your children. This type of insurance plan gives you the flexibility to invest in a children’s plan at the time of the child’s birth and get back your savings when the child grows up. Child insurance policies offered by some insurance companies allow withdrawals at certain intervals. This scheme is very beneficial for such individuals who are worried about meeting the future financial needs of their children.