A premium calculator is an online tool that helps us to find the estimated premium of the life insurance. It is free of cost and you can use it as much as you want. You can compare different life insurance policies from different insurer at a same time. A life insurance policy provides a protective cover to your family in your absence due to any unfortunate occurrence. It works of as a financial cushion that keeps your family well protected while assuring you peace of mind. But buying a life insurance policy can be pretty confusing with a wide range of plans available in the market. You need to compare the life insurance policy based on their coverage benefits, sum assured, and the available riders option. It will help you to find the best suited life insurance policy for you and your family.
So, what are the different types of life insurance policies? Which policy should you buy? Which insurance policy can give you both coverage and saving benefits? Below mentioned are the different types of life insurance policies in India:
Term life insurance
It is one of the most basic forms of insurance policies that you will come across in India. Term insurance premium calculator provides you with a cover for a stipulated time. The nominee is eligible to receive the death benefits If the policyholder dies between the policy tenure.
One of the best things about this policy is that one can buy it at nominal rates. Still, their family can receive massive coverage in case of the policyholder’s death by following the term insurance claim settlement process.
Also, life insurance providers allow the policyholder’s maturity benefit by returning the premiums if the policyholder outlives the period of the policy’s maturity.
Whole life insurance plan
A whole life insurance plan is an insurance plan that offers coverage to the policyholder for their whole life. Unlike the term insurance premium calculator, it has a broader aspect, and the coverage extends till the death of the person who owns a whole life insurance policy.
Further, one can purchase a participating or non-participating whole life insurance policy based on the financial needs and the risk that one can take. In a participating life insurance policy, the premium amount is comparatively higher than its counterpart, but the policyholder receives the dividend regularly. On the contrary, a non-participating whole insurance policy has lower premiums, but the policyholder does not get to avail of regular dividends.
Child insurance plan
A child insurance plan is a type of plan that secures the future of one’s child or children. A lot goes into raising a child, and if life has other plans wherein the parents of a child die, a child insurance plan can take care of the child’s needs. Child insurance policy is best suited for parents who have small children and wish to secure their children’s financial future. It helps finance their child’s needs, such as education and marriage.
Retirement plan
As the name suggests, this life insurance policy assures you financial support after retiring from your services. Post-retirement, you lose a regular income. Even if you receive a pension, it is comparatively less than what you used to earn while in service; thus, retirement plans can help you get a stable and regular income once you stop working. Continuous investment in such a plan during your working life until your retirement will get you a steady income.
Money-back plan
The money-back plan is one of the best life insurance policies. You can buy it because it gives a decided percentage of the assured sum at regular intervals to the policyholder in the name of survival benefits. Further, once the policy matures, the policyholder receives the whole benefit amount. And, if the policyholder dies in between the period, the nominee and the beneficiaries get the insured sum without accruing any deductions.
Unit linked insurance plan
Unit linked insurance plan is another popular life insurance plan that people mostly purchase due to the versatility factor this policy offers to its buyers. ULIP allows insurance benefits and investment benefits to its buyers. A part of the premium that you pay for ULIP goes as an investment for insurance coverage. The rest is divided into various investment instruments that include debt funds, equity funds, and various other securities. ULIP policies are a flexible policy plan as it allows the policyholders to make a switch and direct their premium in different fund buckets available. Also, they help in attaining tax benefits as this policy is exempted from long-term capital gains.
Endowment plan
An endowment insurance plan is best suited for people who wish to have some savings and insurance cover. It is somewhat similar to ULIP because it offers both savings and insurance. Endowment policies are divided into two categories: without profit and with profit. A policyholder can choose one of them as per their requirement. Purchasing an endowment plan makes the buyer eligible to avail of the maturity benefits of the policy as a lump sum in the event of superannuation of the policy if no claim has been made during the policy tenure. This policy ensures coverage for the policy owner’s family and inculcates the habit of savings offering financial security in the long run.
Conclusion
Purchasing a life insurance policy acts as a saviour in case of any misfortunate event happen in your life. Investing in an insurance policy is always a brilliant idea. It offers financial coverage to your family along with the tax and investment benefits. But, when you have so many options, it can be very challenging for you to choose the best available options. However, buying a particular policy depends on the amount of coverage you need for your family. Also, you can get in touch with an agent who can use the term insurance premium calculator and give you a broader view of the policy purchase. So, choose a policy wisely after evaluating all the ins and outs of the different plans available.