Introduction
In this article I will be writing about the different types of Life Insurance Plans in the market. As we know that Life Insurance is important for everyone to protect their family incase of their demise the insured money will save their family for educating their children and marriage of daughter, etc. According to your needs, one can choose their Life Insurance Scheme. This article presents the very basic knowledge on different Life Insurance plans and how it will benefit you in the future. If you have any doubts, please post it in the comments section. You can subscribe to our future articles here.
Term Insurance Policy
This policy is pure risk cover with the insured amount will be paid only if the policy hold dies in the period of policy time. The intention of this policy is to protect the policy holder’s family incase of death. For example, a person who takes term policy of Rs.500000 for 20 years, if he dies before 20 years then his family will get the insured amount. If he survive after 20 years then he will not get any amount from the insurance company. It is the reason why term policies are very low cost. So, this type of policy is not suitable for savings or investment.
Whole Life Policy
As the name itself says, the policy holder has to pay the premium for whole life till his death. This policy doesn’t address any other needs of the policy holder. because of these reasons this kind of policy is not very popular or insurance company not suggesting to take this policy.
Endowment Policy
It is the most popular Life Insurance Plans amoung other types of policies. This polciy combines risk cover with the savings and investment. If the policy holder dies during the policy time, he will get the assured amount. Even if he survives he will receive the assured amount. The advantage of this policy is if the policy holder survives after the completion of policy trnure, he receives assured amount plus additional benefits like Bonus,etc. from the insurance company. In this kind of policy, policy holder receices huge amout while completing the tenure.
In addition to the basic policy, insurers offer various benefits such as double endowment and marriage/ education endowment plans. The cost of such a policy is slightly higher but worth its value.
Money Back Policy
Money Back Policy is to provide money on the occasions when the policy holder needs for his personal life. The occassions may be marriage, education,etc. Money will be paid back to the policy holder with the specified duration. If the polciy holder dies before the policy term, the sum assured will be given to his family. A portion of the sum assured is payable at regular intervals. On survival the remainder of the sum assured is payable.
Summary
This article explained the very basic knowledge on different types of Life Insurance Plans. There is some other policy also available in the market but I did not write about it because these are the popular policies. If you have any doubts please post it in the comments section. Thank you for reading this article.
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September 12, 2009 at 9:22 am
your site a huge work in time
May 26, 2012 at 7:39 am
no difference in the cover you get, but be cafuerl 30 year policies will probably be cheaper per month than a full term policy That’s because you will be younger and healthier and less likely to need to use it (less risk for the insurer), but in 30 years time it will cost more because you will be older and more likely to claim on the cover. It’s possible too that the insurer will not renew the policy if they feel you present to great a risk e.g. if you have been seriously ill in the first 30 years (heaven forbid). A full term policy will be a set price for the whole term. It might start out a little more expensive at first, but with no renewal to worry about, you might save a bit of money in the long term End of the day, insurers are business people They’re in it to make money Just do some research and I’m sure you’ll find good quotes!
September 12, 2009 at 9:57 am
Hello Asif,
Thank you for the comments.
Thanks,
Krishna
October 8, 2009 at 10:27 pm
Thanks for this post. It helped me learn so many new things about life insurance. Lets us share our knowledge about life insurance and how to get the best quote possible for a life insurance policy as per individual requirements. Looking for such more discussions.
http://www.onlyinsurance.com/
October 9, 2009 at 1:39 am
Hello Jonathan,
Thank you for the comments.
Thanks,
Krishna
June 19, 2010 at 5:33 am
Nice article. Keep up the good work.
September 2, 2010 at 10:09 am
indeed insurance policy is the financial messiah that many do not know about.great job on this as you went straight comprehensively into making an informed audience,good job…BINGO
October 4, 2010 at 10:00 pm
Please help me some body i want make a fixed depasit on the name of my doughter (1 Year old) with the LIC. just i want know is there any different polacy’s on term deposits
December 27, 2011 at 5:49 am
Will I have to pay tax on endowment policy when its matured?
January 20, 2012 at 10:01 am
hello sir, i am doing master degree and this information helped me a lot so please keep posting
February 6, 2013 at 11:35 pm
We are a professionally qualified and authorized agent of Lic of India being in service from past 10 years servicing local clients in India and NRI clients abroad. Life insurance policy by Lic of India provides safety, security and reparation or compensation to the nominee or family members on the demise of an insured individual.
April 20, 2013 at 2:56 am
You can definitely see your enthusiasm within the article you write.
The world hopes for even more passionate writers
such as you who are not afraid to mention how they believe.
At all times follow your heart.
May 8, 2013 at 6:34 pm
It’s in fact very difficult in this busy life to listen news on Television, thus I just use world wide web for that reason, and take the most recent news.