A life insurance policy is a policy provided to the insurance service providers that helps individuals get cover for their life for a set period or provides the nominee with a sum assured if the policyholder comes across an unfortunate death. Life insurance policies are designed to provide you with the cover you need & also provide your near & dear ones with the sum assured upon your unfortunate demise. A life insurance is more than just 1 type. The types of life insurance policies are:
- Term life insurance plan
- Health Insurance Plan
- Unit Linked Insurance plan
- Endowment Plan
- Annuity plan
Here is a brief about each of these life insurance plans:
- Term life insurance plan: A term insurance life plan offers the nominee a cover for life in exchange for a fixed premium amount. However, the nominee can redeem the sum assured after the policyholder’s unfortunate demise.
- Health insurance plan: It provides the policyholder with reimbursements of their medical expenses, including treatments, surgeries, hospitalization, and the like, which arise from injuries/illnesses based on their cover & plan.
- ULIPs: Unit-linked insurance plans are unique policies that offer insurance & investment in the same policy. The premium is partly invested in equity/ debt & the remainder goes towards your life cover.
- Endowment plan: It allows you to save & have a life cover at the same time. One of the life insurance policies that provide you with this rare opportunity.
- Annuity plan: It is sort of a retirement plan that offers you a regular return for a lumpsum investment. The life insurance service provides you with a monthly or quarterly sum after a certain duration of time.
Here is how life insurance can act as a backup for you in critical financial situations:
Life is unpredictable & there is nothing you can do to change it. However, you can relax your mind and focus on other important things by making investments in one or more life insurance policies based on your needs.
A life insurance can protect the financial interests & needs of your family in case you meet with an unfavorable incident. With the riders that can be added on to the policy, you can also benefit by having a cover or support for yourself when you meet with an accident or are suffering from a critical illness.
Life insurance offers you with peace of mind & can be a support for you in dire situations. It helps you save for your old age when health issues increase & savings is a critical component. It can also ensure you with a regular income if you choose annuity or retirement plans. In addition, life insurance can help you ensure your children’s future educational needs are taken care of & they get the best facilities they need in order to survive.
If you are a business owner, a parent with young children, an individual nearing retirement age, a working professional, or a newly married couple, all of you need life insurance.