4 types of life insurance
4 types of life insurance – Life insurance is a type of insurance policy that provides financial protection to your loved ones in the event of your death. When you buy a life insurance policy, you pay a regular premium to an insurance company. In exchange, the insurance company promises to pay a lump sum of money, called a death benefit, to your designated beneficiaries upon your death.
Types of Life insurance –
Here are the 4 types of life insurance policies in India:
Term Life Insurance:
This type of life insurance policy provides a death benefit to the nominee if the policyholder dies during the policy term. It is the simplest and most affordable type of life insurance policy. The premium for term insurance policies is generally lower than other types of life insurance policies.
Endowment Plans:
Endowment plans are a type of life insurance policy that combines insurance coverage with savings. The policyholder pays a premium, and a portion of the premium is used to provide life insurance coverage, while the remaining portion is invested in a savings component. The policyholder receives a lump sum amount at the end of the policy term or on maturity.
Unit-Linked Insurance Plans (ULIPs):
ULIPs are a type of life insurance policy that provides a life cover along with investment opportunities. The policyholder pays a premium, and the premium is invested in a variety of investment options such as stocks, bonds, and mutual funds. The value of the policy is linked to the performance of the underlying investments.
Money-Back Policies:
Money-back policies are a type of life insurance policy that provides periodic payouts to the policyholder during the policy term. These policies provide a percentage of the sum assured at regular intervals, which can be used to meet various financial needs. If the policyholder survives the policy term, a lump sum amount is paid out as the maturity benefit.
