What are the different types of life insurance policies available?

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 What are the different types of life insurance policies available?

There are several alternatives when it comes to life insurance policies, but the main issue is to understand and pick the right one. One can also take help from various LIC agents in Nagpur or all over the country to clarify their choice. If staying in Nagpur or nearby, one can also seek help from local insurance advisors in Nagpur or from local insurance agents or LIC agents in Nagpur. They can provide you with tailored guidance based on your demands and financial objectives. Following are a few prevalent forms of life insurance policies in India:

Term Life Insurance: This is the most basic type of insurance that covers a specific period of time and is known as a "term" policy. If the insured person passes away within the policy period, the death benefit all goes to the beneficiaries. As this policy does not cover any cash value, it is available at a very low premium as compared to other product policies. There is no maturity value if the insurer dies after the policy term. However, there are some plans that offer returns of premium to the policyholder who survives the policy term. For understanding that one can take help from an insurance agent in Nagpur in locating suitable term life insurance in case you only need temporary protection against a period of time,

Whole life insurance: is also recognized as "traditional life insurance." This insurance covers the entire life of the insured person. Beside this life coverage, it also includes a death benefit and a cash value component that increases with time. Generally, it comprises a maturity period of 100 years, and if any policyholder survives this term, they are paid the maturity amount. The premium value of this life insurance is generally higher than that of term life insurance.

Endowment policies: are the ideal combination of investment and insurance that provide life insurance and also assist in building funds for a lifetime. The premium is split between certain low-risk assets and the sum assured, which receives the majority of the premium. In this policy, the nominee gets the sum assured if the policyholder passes during the policy term. And if the policyholder stays alive to the end of the policy term, they get their money back plus incentives. Hence, it fulfills the dual action of both investment and insurance.

Unit-Linked Insurance Plans (ULIPs): By investing in a variety of market-related products and funds with differing risks, ULIPs offer life insurance and prospects for capital growth. Depending upon the policyholder’s risk tolerance, a portion of the premium is invested in funds linked to different assets such as equities, debt funds, etc. The remaining premium is then divided into life coverage component and return generation, where the portion of premium goes towards return generation. ULIPs provide a certain amount of versatility. They also allow fund switching and partial withdrawal after 5 years and give access to customize investments with current financial goals.

Money Back Policy: basically, these are endowment plans with the addition of payments made at specific pre-determined intervals over the course of the policy term. In addition, maturity benefits and accrued incentives are paid upon maturity. If the policyholder dies during the term, the nominee will get the sum, which is independent of any previous payments of survivor benefits.

A pension plan: Also known as a retirement plan or annuity plan, helps an individual accumulate wealth for the golden years of their life or post-retirement. This helps in the phase after retirement when one goes through financial uncertainties. Thus, this plan allows you to spend a certain amount of your earnings as premium in early life, which is subsequently paid back as an annuity or pension at a specified interval of time to the policy holder.

Considering the above, it is very critical to select from various insurance options and also to find knowledgeable and specialized guidance. Hence, it is advised to take help from internet directories or get in touch with nearby insurance businesses to find out about insurance agents, LIC agents, life insurance consultants, or investment planners in Nagpur before going for any policy. It is very important to have a knowledgeable expert and guidance that can help you choose the best life insurance option.

 

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