When it comes to financial planning, a life insurance policy is the first thing that everyone seeks. It is designed to protect your loved ones from life’s uncertainties and keep you financially healthy. However, today there are various types of insurance plans in the market.
In this article, let us check some of the most popular types of life insurance policies available in India.
- Term Insurance Plan:
This is perhaps one of the most sought-after life insurance policies. Unlike other policies, term insurance is a pure life cover as it does not come with a savings component. This policy offers you the opportunity to opt for a significant life cover at a lower premium as compared to other types of life insurance policies.
- Unit Linked Insurance Plan (ULIP):
ULIP offers you both – life cover and wealth creation option. It comes with a lock-in period, which may differ from one insurer to another. Generally, this policy is opted for by people who are looking at financial instruments to support their long-term goals. ULIP also comes with risk protection and allows you to balance your funds as per the dynamics of the market.
- Whole Life Insurance:
This insurance policy provides insurance coverage to the insured for the entire life, or up to 100 years of age. The death benefit is paid to the beneficiary in the case of the untimely demise of the policyholder. Furthermore, some whole life insurance policies may also offer you a maturity benefit if you cross 100 years of age.
Another significant feature of this life insurance policy is that you may have to pay a premium for the first 10-15 years while you get benefits for the entire life. However, this feature may differ from insurer to insurer. Hence, it is recommended that you go through the policy details before you make the purchase.
- Endowment Policy:
Another popular type of life insurance policy in India is the endowment policy. It comes with a dual benefit of savings and life cover. This policy comes in handy to fulfil your long-term goals. It also offers you a maturity amount if you survive the policy duration. An endowment policy helps you create a financial cushion for your family and meet various financial objectives in life.
Each of these life insurance policies is beneficial, provided you pick the one which best suits your need. You may also seek professional guidance to help you find the policy which resonates with your goals.