Types of Life Insurance plans in India

Life insurance is the most talked about matter in the market. Though majority of people are familiar with it, however they do not know the difference between the various life insurance plans. The excellent thing about insurance is that the awareness has been enhancing over a period of time. A decade back, people used to get it because somebody from their family or acquaintances compelled them to purchase it. However, nowadays people acquire it to lessen the risk. People have started identifying with the need of an hour.

Life insurance can be categorized as whole life, endowment, term, money back and Unit Linked Insurance Plan (ULIP).

Whole-Life Plan – Life Insurance Company gathers payment from the insured till the retirement or the time of the plan and gives the claim to the claimants, only following the passing away of the insured human being. This is of assistance to the family to live on a better life after the passing away of insured.

Endowment – Insurance Company gathers premium form the insured for the assured period of time. Company compensates amount guaranteed to the nominees in case of passing away in the plan period or disburse the premium paid with fix returns (as stated by document).

Money Back – The policy is valuable for that investor who requires periodical payments. The insurance company gathers premium for a definite period of time which is identified as premium payment term, and pays proportion of amount assured to the insured on regular gap of time. If the person passes away in the plan period, company pays amount assured and accumulated bonus to the candidates.

Term Plan – in case of term insurance, insured disburse sum to cover the death risk. He does not acquire anything from the company, if he stays alive till the conclusion of plan period. The premium remunerated for term cover goes to the company. The excellent part of this arrangement is, insured gets utmost death cover with smallest amount of premium.  These days, companies have come up with plans with return of premium, if nothing happens to insured throughout the period; the company pays fraction of the premium back.

ULIP – it is a new flavor of insurance which is a combination of savings as well as insurance. Companies gather premium form client and put in the same into equity as well as debt markets. The profits generated by this investment are passed on to the investors at the maturity. The insured person acquires the benefit of risk cover and the asset gains. The product moreover offers the flexibility of limited withdrawal after definite time of premium payments. In case of passing away, the candidate gets the sum guaranteed or fund value, whichever is higher.

MetLife, life Insurance Company of India operates in India ever since 2001 and is an affiliate of MetLife, Inc.

Source by Metlife