An insurance policy can help you save tax. Knowing this an individual lands up buying insurance policies for only the tax benefits. But there is more to it than just the tax benefit. An is mainly designed to cover the financial loss in case of the death of the policyholder and to insure your life. In case you are availing of a policy make sure you do it for the right reasons. One should first check your needs and all the plans available in the market before buying a policy.
Following is a nutshell of the policies available.
Traditional Pension Plan This plan aims at giving you the funds when you do not get your regular income. This plan gives guaranteed returns. Here the company invests on your behalf in market linked funds which is either debt , equity or both. There are also unit linked , depending on what your requirements are.
Moneyback It is a plan where you get funds back at various intervals during the policy term. Besides that also at the end of the policy you get the maturity benefits as well. But this policy is more on the expensive side and does add much value.
Term Plan A term plan is a pure insurance policy without any investment benefit added to it. So if you looking only for an insurance cover then term plan is what you should avail of. It is a plan which gives you a high cover for a low premium amount. The plan is designed in such a way that incase of any unfortunate situation the policyholder's dependents get the sum a assured and are financially secured. But if the policyholder survives through the duration of the policy term he does not get any benefits. You have various payment options like monthly, half-yearly, yearly or single. In single premium paying option you can pay at one stroke fro your policy cover. It is advisable to take a term policy early in life as you get a high cover for a low premium.
Unit linked insurance plans These plans Invest your money in the market linked funds and hence builds a corpus for you for the future. A ULIP is designed to give you twin benefits of investments and an insurance cover. But you need to be invested in these plans for a longer duration to get good returns. Here the policyholder gets to choose which kind of funds he would like to invest in depending on his risk appetite. Also in the event of death of the policyholder the dependents get the benefits. If you are looking for both investment and insurance benefits then this is the right plan for you.
So, one can have all of the above policies but you need to decide what are your requirements invest in the plan most suited to you. You should always have a mix of various plans like life, health and retirement.
Times sure are changing. There was a time when bullocks and horses acted as transport systems. In today's world, bullocks and horses are themselves carried from place to place on vehicles driven by engines. There was a time when all that a girl could hope for was to marry a good and sufficiently wealthy man. These days, women make their own money and only if they are so inclined do they think about marriage. There was a time when the only available insurance plan was on life. Today, anything can be insured. From diamond jewelry to pets to footballers' feet, any and everything is subject to being insured.
The most common types of insurance, of course, are motor insurance and home insurance. You can insure your car so that later on, making repairs will be relatively easier on your pocket. Moreover, several countries insist that no car should be taken out on the road without its first having got insured. Are you surprised at that rule? Well, you really should not be. After all, given the large numbers of accidents on the road, it is a good idea to get the cars insured at the very onset. Interestingly, these days, insurance providers have come up with a plan that covers third party cars. Thus, if your car rams into another, your insurance deal will take care of the other person's repair costs as well.
Getting insurance for your house is also a must. Things like fires and burglaries do not need invitation cards. They come uninvited and either burn or run away with much of your hard-earned dough. A good insurance plan will take care of these unwanted eventualities. At least you will not have to keep on worrying about how you will manage if such a thing does happen. You have insured your house after all.
Medical insurance is another common type. It makes sense to cover yourself for possible medical problems. So, if it does happen that you need to undergo an urgent operation, you will not have to postpone it because of lack of funds.
One up-coming insurance type is the travel insurance. This is a good idea for people who are traveling quite a distance away from their homes. You never know what medical problems may occur. To be stuck without sufficient money in a strange land can be terrifying.
Every day heralds the birth of yet another type of insurance. Which insurance plans would you say are the most important?
Both Bimadeals & Ajeet Khurana are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Bimadeals has sinced written about articles on various topics from Insurance, Health Insurance and Insurance. Author has been engaged in insurance processing for a long time. Currently he is focusing to provide important information on