Is Money Back Policy A Good Investment Option?

A Money Back plan is a type of life insurance policy that allows the insured person to receive a percentage of the sum assured at regular intervals throughout the policy's duration, and then receive the entire sum assured plus the bonus when the policy matures. A policyholder can buy a Money Back plan and pay recurring premiums for a set period of time. The nominee will receive a lump-sum payment known as the death benefit if the policyholder dies. It also gives you the option of adding extra layers of protection by using add-on coverings or riders.

What Are the Benefits of Buying a Money Back Policy Plan?

For a variety of reasons, a Money Back plan is an excellent investment option. Some of the reasons are as follows:

1. Availability of liquid assets

This plan will provide you with liquidity because you will be paid on a regular basis. This allows you to better plan and manages your financial obligations in the present and future.

2. Returns with No Risk

Other products, such as ULIPs, are risk-free because they invest in a wide range of market instruments. Investing in products like ULIPs can be risky because they pool your money in stocks and equities. Purchasing a Money Back plan is a good idea if you don't want to take such risks.

3. Advantages of Survival

Every month, a money return plan pays you a portion of the sum assured. If you complete the term, you will be eligible for maturity benefits as well as any other incentives that may be available.

4. Insurance Protection

Money Back plans serve as both an insurance and an investment product, and they strike the right balance for you. If something happens to you, regardless of the regular payout you've been receiving, your nominee will receive the guaranteed sum. Money Back plans allow you to not only grow your money and receive a monthly income to meet your needs, but they also help to financially protect your family.

5. Bonus

An insurance company may offer you a bonus if it makes a profit. This could be considered a bonus, and it's always a good idea to get a Money Back plan from a reputable insurance company.

6. Benefits from Taxes

In addition to the death benefit that your nominee is entitled to in the event of your untimely death and the maturity benefit that you receive if you survive the term, you are also eligible for tax benefits under Section 80C of the Income Tax Act of 1961.

Conclusion

If you are looking for a product that provides insurance coverage while also assisting you in building a corpus, a Money Back plan is highly recommended. ULIPs, endowment plans, and other types of insurance are examples of products that not only provide coverage but also allow you to maximize your investments. These items, on the other hand, are not equivalent to a Money Back guarantee. ULIPs are risky because they invest their money in a variety of market products. Unlike Money Back plans, Endowment plans do not pay their investors on a regular basis. If you don't want to take any risks and want a monthly income credited to your account, a money return plan is the best option for you.

Also read- Understand The Functionality Of Money Back Policy

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.