Frequently Asked Questions About Money Back Policies
Table of Contents
If you have been looking for a good savings plan, money back can be your ultimate choice. A popular life insurance policy type, money back policy provides the policyholder with money-back payouts at regular intervals. One of the key reasons that make money-back policies a superior choice among policy buyers is that they resolve the issue of liquidity during the policy term. If you too have been considering the purchase of a money-back policy, read the below mentioned Frequently Asked Questions to get your doubts, if any, clarified.
Frequently Asked Questions About Money Back Policies
The list includes:
- How Does a Money Back Policy Provide Liquidity During the Policy Tenure?
A money-back policy provides a percentage of the sum assured regularly throughout the policy tenure.
- Why Should I Buy a Money Back Policy? How Will It Benefit Me?
Your money back policy will provide you with the much-desired liquidity during the policy term apart from survival benefits. You will also gain risk-free benefits.
- What Will Happen to My Money Back Policy Sum Assured if I Die?
In the case of the death of the policyholder during the policy period, the sum assured is given to the nominee.
- Will My Money Back Policy Give Me Insurance Coverage as Well?
Yes! Your money back policy is the low-risk savings option that will grant you insurance cover as well.
- Will I Be Able to Extend My Money Back Cover With Riders?
Yes! Almost every life insurance company provides riders to increase coverage.
- How Should I Choose a Money Back Policy?
While choosing a money back policy, you should keep a few factors in mind. The key factors include financial goals, period of investment, payouts, amount to funds you can invest in.
- What Are Some of the Documents Required for Buying Money Back Policy?
Some of the important documents that you are required to submit to buy your money back policy are income proof, address proof, age proof and ID proof.
- Will the Amount Received Through Money Back Policy Be Taxable?
No! The amount received through money back policy will be free from tax as per section 10(10D) of the Income Tax Act, 1961.
- Will I Be Allowed to Transfer My Money Back Policy?
No! Unfortunately, transfer of money back policy is not allowed. However, the policyholder is allowed to make an assignment in the name of another person.
- Will I Be Allowed to Revive My Money Back Policy if It Gets Lapsed?
Revival of a lapsed money back policy is allowed within 2 years from the date of lapse. The duration may vary with the insurance company.
- What if I Want to Surrender My Money Back Policy?
If you wish to surrender your money back policy, it is advisable to do so by visiting the insurance company’s branch office.
- What if I Am Not Able to Pay the Money Back Policy Premium on Time?
In case you fail to pay your money back policy premium on time, your policy will enter a grace period. In case, you fail to pay your policy premium during your grace period, your policy will get lapsed.
Also Read:
Why You Shouldn't Dodge The Idea Of Purchasing A Money-Back Plan?
Are Money-Back Policies Productive?
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.
