Plans allow systematic enhancement of wealth with insurance
Money back plans are life insurance plans which not only provide Risk cover but also offer guaranteed survival benefits through periodic installments during the Policy Term period. On death of the life assured, the Beneficiary gets the death benefit, which is equal to the sum Assured irrespective of the survival benefits he or she had already got so far. In short, there is financial protection as well as life cover for the life assured.
Let’s find out more on the features of money back plans and the benefits one can get from them.
Generally, the minimum age of the Life Assured is 13 years while the maximum limit is 50 years. The limits vary from one policy to another.
The minimum Sum Assured is by-and-large Rs. 50,000. There is generally no upper limit.
Term period is often flexible where the Policyholder can choose a period of 15 years, 20 years, or 25 years.
Mode of Payment of the Premium
There are generally 4 modes of payment, which are monthly, quarterly, half yearly, and yearly.
The money back plans are often considered to be the best investment plans as they provide financial benefit, risk cover, and miscellaneous benefits. For instance:
Money back plans are not just for kids’ education or for those who want to spend money for a luxurious holiday trip. Many retirement plans for the elderly offer money back facilities where regular installments are given to the old couple after retirement. Plans to cater to single yet working women have also been formulated. There are plans that act as an investment policy for the mentally challenged. The benefactor pays the premiums while survival benefit helps the challenged kids in later years after the death of the benefactor. The investment income can be further rolled out into retirement plans for the kids.
If you look at a money back plan as an investment option, it may not be the best investment plan. The profit would only be 6-11 percent. However, money back plans are not just investment policy but a life insurance plan as well. It offers Risk Cover and also provides fixed tax-free income which you can depend even for a long period of 20 or 30 years. It is perhaps an acceptable combination of risk cover and savings option which gives you a peace of mind.