Types of life insurance plans in india
There are several types of life insurance plans available in India. Here are some of the most common ones:
This is the most basic and affordable type of life insurance. It provides coverage for a fixed term, usually 10-30 years, and pays out a death benefit to the nominee in case the policyholder passes away during the term.
An endowment plan offers both insurance coverage and savings benefits. The policyholder pays premiums for a fixed term, and at the end of the term, receives a lump sum amount that includes both the death benefit and the accumulated savings.
Unit Linked Insurance Plan (ULIP)
A ULIP is a type of life insurance plan that combines insurance coverage with investment options. The policyholder can choose to invest in equity, debt or hybrid funds, and the returns are linked to the market performance of these funds.
Money Back Plan
This type of insurance plan offers periodic payouts to the policyholder during the policy term, while also providing insurance coverage. The payouts are usually a percentage of the sum assured and are paid out at regular intervals.
Whole Life Insurance
A whole life insurance policy offers coverage for the entire lifetime of the policyholder, as long as the premiums are paid. The policyholder’s family receives the death benefit in case of the policyholder’s demise.
A pension plan is a type of insurance plan that offers regular income to the policyholder after retirement. The policyholder pays premiums during their working years, and receives a regular income stream after retirement.
A child plan is a type of insurance plan that is designed to secure the future of a child. The policyholder pays premiums, and the child receives the maturity benefit after a certain age. In case of the policyholder’s demise, the child receives the death benefit.
These are some of the most common types of life insurance plans in India, and each plan is designed to cater to specific needs of individuals and families.
List of the plans from LIC of India under these types.
Sure! Here’s a list of the plans offered by Life Insurance Corporation of India (LIC) under each of the types of life insurance plans in India:
- LIC Tech Term Plan
- LIC Jeevan Amar Plan
- LIC e-Term Plan
- LIC Anmol Jeevan II Plan
- LIC Jeevan Labh Plan
- LIC Jeevan Anand Plan
- LIC New Endowment Plan
- LIC Limited Premium Endowment Plan
Unit Linked Insurance Plan (ULIP)
- LIC Market Plus I Plan
- LIC Wealth Plus Plan
- LIC Fortune Plus Plan
- LIC Money Plus Plan
Money Back Plan
- LIC New Money Back Plan-20 years
- LIC New Money Back Plan-25 years
- LIC Jeevan Shiromani Plan
- LIC Bima Bachat Plan
Whole Life Insurance
- LIC Jeevan Umang Plan
- LIC Whole Life Plan
- LIC Jeevan Akshay VI Plan
- LIC Jeevan Nidhi Plan
- LIC New Jeevan Shanti Plan
- LIC Jeevan Tarun Plan
- LIC Child Career Plan
Please note that this list is not exhaustive and there may be other plans offered by LIC under each of these types. Additionally, the plans and their features may be subject to change, and it’s always recommended to check with LIC or a licensed insurance agent for the latest information and advice on choosing the right plan for your needs.
How is term plan different from a endowment plan.
Term plan and endowment plan are two different types of life insurance plans with distinct features and benefits. Here are the main differences between the two:
Purpose: The main purpose of a term plan is to provide pure life coverage and financial protection to the family in case of the policyholder’s untimely demise during the policy term. On the other hand, an endowment plan not only provides life coverage but also offers savings and investment benefits.
Premiums: Term plans have lower premiums compared to endowment plans, as they only provide insurance coverage without any savings or investment component. Endowment plans, on the other hand, have higher premiums, as a part of the premium goes towards the savings and investment component of the plan.
Maturity Benefit: A term plan does not offer any maturity benefit if the policyholder survives the policy term. The policy only pays out the death benefit to the nominee in case of the policyholder’s demise. In contrast, an endowment plan provides a guaranteed maturity benefit at the end of the policy term, in addition to the death benefit.
Returns: The returns on a term plan are generally limited to the death benefit, which is paid out to the nominee. In contrast, endowment plans offer higher returns, as a part of the premium is invested in the market, and the policyholder receives the accumulated savings and investment returns at maturity.
Flexibility: Term plans are generally more flexible than endowment plans, as they offer the option to choose the policy term and the sum assured based on the policyholder’s needs and financial goals. Endowment plans, on the other hand, have fixed policy terms and sum assured, and the policyholder has limited flexibility to change the terms of the plan.
Overall, term plans are designed to provide affordable and comprehensive life coverage, while endowment plans offer a combination of life coverage and savings/investment benefits. The choice between the two types of plans depends on the policyholder’s financial goals, risk appetite, and insurance needs.
How does a ulip plan work? Are these market linked
Yes, Unit Linked Insurance Plans (ULIPs) are market-linked insurance plans that combine the benefits of both insurance and investment. Here’s how a ULIP works:
Premium Payment: The policyholder pays a premium towards the ULIP, which is used to provide life insurance coverage and also invest in market-linked funds.
Fund Allocation: The policyholder can choose the type of funds they want to invest in – equity, debt, or a combination of both. The premium paid is then allocated to these funds in a proportion decided by the policyholder.
NAV: The net asset value (NAV) of the ULIP units is determined by the performance of the underlying funds. The NAV is calculated by dividing the total value of the underlying assets by the total number of units in the fund.
Death Benefit: In case the policyholder passes away during the policy term, the nominee receives the death benefit, which is the higher of the sum assured or the fund value.
Maturity Benefit: If the policyholder survives the policy term, they receive the maturity benefit, which is the fund value at the end of the term.
Charges: ULIPs come with charges such as premium allocation charges, fund management charges, mortality charges, and administration charges. These charges are deducted from the premium paid by the policyholder, and the remaining amount is invested in the funds.
ULIPs offer the flexibility to switch between different funds based on the policyholder’s financial goals and risk appetite. They also offer tax benefits under Section 80C of the Income Tax Act, 1961, and the maturity and death benefits are tax-free under Section 10(10D) of the same Act. However, it’s important to note that ULIPs are subject to market risks, and the returns on the investment are not guaranteed. Therefore, it’s important to understand the risks involved and choose the right fund based on one’s financial goals and risk appetite. FInd a LIC Agent near you and consult them before you take a decision on which policy to buy.