Insurance policies come in a wide range these days, and with so many options around, it is really difficult to pick the right one. An ideal life insurance policy should be chosen on the basis of two factors, i.e., budget and the benefits that it offers. Once you choose a policy that fulfils these factors, you have nothing else to worry about in the longer run.
About Life Insurance
The purpose of buying a life insurance policy is to ensure that the dependent family members can bear through losses in terms of finance if something were to happen to us. While going through options of popular insurance plans, we often have considerations for expenses relating to housing, loans, debts, education, marriage, etc.
Often people get confused between the idea of choosing one policy or multiple ones for their requirements. In order to get the right answer, it’s important to get clarity and understanding of the available policy options.
Following are the types of insurance that you need to go through in order to choose the one for your requirements.
Term insurance refers to protection plans that cover death risk for an individual. In case the person with insurance dies before completion of the term of the plan, the total sum of the policy taken by them is paid to their nominee. These insurances fall under the category of cheap and reliable options of life insurance.
Endowment Assurance Insurance
The endowment assurance policies provide the holder with a cover throughout the span of the policy and return a good amount once the period is completed. These plans are relatively costly, but they offer long-term savings and bulk returns upon maturity.
This category of life insurance continues throughout the lifespan of an individual, and upon his/her death, the amount is transferred to the nominee. Though this option has several benefits like guaranteed death benefit and fixed annual premiums, the rate of return is often not as competitive as the other plans. Nevertheless, these premium insuranceplans are good to choose for long-term savings.
Money Back Policy Plans
If you’re someone, who needs systematic planning of finances, the money back policies are for you. These plans guarantee returns at regular intervals along with insurance cover, income, and tax benefits.
Unit Linked Insurance Plans
Unit-linked insurance plans are a combination of mutual funds and term insurance policies. When a customer pays his premium, the insurance companies deduct a certain amount for charges like fund management and premium allocation. The remaining amount is then invested in funds. This helps the customer with flexibility while managing investments and liquidity.
Retirement Insurance Plans
As the name suggests, retirement insurance plans or pension plans help people to build their funds during their working tenure. Once the policyholder retires, the pension is paid monthly/annually or annually as per their choice.
Buying an insurance policy through best life insurance companies has several advantages that are unavailable in other types of investments such as:
- A life insurance policy offers cover for high life risk and keeps you and your loved ones protected financially
- If any unwanted event takes place, the policyholder’s nominee gets the assured sum along with the bonus which makes insurance a good choice for investment
- Upon comparing with other investments, life insurance policies offer better outcomes and security
- Life insurance schemes offer Income tax reduction benefits as per the Section 80C.
- Apart from other benefits, these plans provide you with the advantage of taking policy loans in case of urgent need
- You can also opt for additional covers with your basic policy which cover other risks that are not included in your policy plan such as critical illness, accident, income benefits, etc.
It is needless to say that opting for a life insurance policy is a necessity. It helps you to minimize risks and acts as a protection tool in case of emergencies. For the sake of security, it’s always recommended to take preventive measures such as a life security insurance policy. You can compare the best available life insurance policies on Coverfox.com and find the best plan for you.