Not all life insurance plans give fixed benefits, especially if it’s a ULIP. Still, there are life insurance policy which work out as fixed deposits of bank. These come under the category of life insurance plans with fixed or guaranteed plans. Often these are known as Endowment plans.
In this kind of life insurance plan you can make a once in a life time payment of the premium and reap the benefits. In this kind of insurance plan the maturity benefit you receive depends on the term selected and the amount paid as one time premium. Generally, this kind of insurance has the minimum age of insurance as 18years and maximum time as 60years. The total age covered is upto 75 years. The term for insurance generally is 5, 7, and 15 or 20 years, you can choose the term as per you capability.
This kind of life insurance is good as one can also take loan on the basis of this policy. However, for the first 3 years of taking policy you cannot take the loan. On the completion of the 3 year term, one can take the loan. The amount of loan approved depends entirely upon the number of years the policy has been taken.
In this kind of plan the life insurance cover increases every year to combat inflation. The life insurance plan also provides enhanced Accident Rider. This feature makes it a very good plan for those with low incomes and those who can invest a large amount once in a lifetime. Those who have also have a number of dependents, should also take this policy.
Generally, the premiums paid for the insurance qualify for tax rebate under Sec 88 of Income Tax Act, 1961 and the returns are fully exempted under Sec 10(10D). So, invest in an insurance policy and make your future life as easy as possible.
A number of Life Insurance Company like ICICI Prudential, HDFC Standard and Aegon Religare offer such insurance policies. Though all of them vary a little in terms of presentations, guidelines and benefits, still all of them work on the same base line as proposed by IRDA.
