There are many life insurance policies offered in India. But choosing the one that is right fpr you is crucial since it enables you to protect your loved ones from the uncertainties of life. It’s possible that you are not fully aware of the many life insurance policy options offered in India or how those options would affect your financial status.
Let us take a quick look at the types of life insurance policies available in India:
- Term Insurance: One of the most popular types of life insurance policies in India is the term insurance plan. This sort of life insurance policy is one that you can get in India for a set amount of time, such as 10, 20, 30, or more years, hence the name.
Level term insurance is a pure life insurance policy and does not provide maturity benefits. It’s one of the reasons it tends to be less expensive than other life insurance plans.
- Term insurance with return of premium: One of the best insurance policies in India for you, among the many different types of life insurance, is term insurance with a return of premium that also provides maturity benefits.
It is the kind of term insurance policy that reimburses you for your premiums if you survive the policy’s term.
- Unit Linked Insurance Plan (ULIP): This insurance option, which is offered in India, serves the needs for both investment and insurance. It is a type of life insurance that offers both financial growth and life protection. It has a five-year lock-in period and functions as a tool for long-term investments.
- Endowment plans: An endowment policy is a type of life insurance that combines the benefits of life insurance and savings. It is one of the types of life insurance that help you regularly save money over time in order to obtain a lump sum amount at maturity, in addition to providing life insurance.
These are among the most practical life insurance plans because they support achieving long-term objectives. If you live out the policy’s term, you would also receive the maturity amount.
- Money-back policy: Building wealth may be a long-term objective of getting insurance for your loved ones in India. The majority of life insurance policies, however, do not include any options for receiving money before the policy’s term is out. In this situation, a money-back policy is essential for resolving this liquidity issue. Another life insurance tax benefits is that the money you get back may be entirely tax-free.
- Whole life insurance: It is among the well-liked categories of life insurance plans that offer survival pay-outs. Unlike other types of life insurance plans, which offer no returns until maturity, it pays a percentage of the assured sum over the course of the policy.
In contrast to other types of life insurance, a whole life insurance plan provides insurance coverage to the insured for their entire lives, up to the age of 100. The beneficiary of a whole life insurance policy normally receives the death benefit in the case of the policyholder’s untimely passing. On the other hand, you start to qualify for a maturity bonus under a whole life insurance policy after you reach the age of 100.
- Group life insurance: Group life insurance is one of the life insurance plans that cover a group of people under one main policy, just like group health insurance. Such life insurance policies are typically offered to employees by employers.
- Child Insurance Plans: A child plan is a life insurance that combines investment and insurance to assist you in providing for your child’s financial requirements. Your ability to build wealth for your child’s future needs, such as schooling, would be aided by a child insurance plan. You can start investing from the moment your child is born. You can also reap life insurance tax benefits for the premium amount that you pay for this plan.
- Retirement Plans: A retirement plan is one type of life insurance that offers monetary security and promotes wealth accumulation after retirement. You would receive a specific amount from the retirement plan as a pension during the vesting time.
Choosing the type of life insurance coverage to buy might be challenging. It’s because choosing forces you to think about the unfavourable events that can occur in your life. Another factor is the cost aspect of purchasing different life insurance policies. To ensure the future security of your loved ones, it is recommended to be insured.