Why To Buy Money Back Plan?
Table of Contents
A money-back plan is the best choice for people who want regular incomes at specified intervals. Money Back Plan is a special type of life insurance policy that falls under Endowment Plans. It is also called Anticipated Endowment Plans but they are more commonly known as Money Back Policies.
It simply means that in Money Back Plans, the money comes back to the Life Insured after a specific interval of time as a Survival Benefit. However, if the Life Insured dies during the policy term, then the Death Benefit would be paid to the nominee and the policy would be terminated and no further money would be paid to him on the intervals.
Why To Buy Money Back Plan?
The money-back plan offers lump-sum advantages during the policy tenure. Such features ensure you have a regular income flow no matter what the tenure period is.
Money paid back on a regular interval will be the percentage of the total sum assured. And this percentage will differ from one company to another.
A traditional insurance plan will also be a good investment option. But, it might not completely fulfil your urgent financial requirements as the amount will be released just after your policy tenure ends. It is where a money-back plan proves very beneficial. Now let us know why you want it:
- The money back plan offers both survival & death benefits with bonuses.
- These plans provide life insurance cover
- The plan offers regular income flow during your tenure period.
- The money-back plan proves quite helpful especially when tackling any sudden financial trouble.
- In case an insured individual dies during his or her tenure period, then the entire assured sum will go to his/her nominee.
- The plan is the best choice for people who want a risk-free policy. The money-back plan mainly involves low risk.
- You will get additional tax benefits too.
Money back policies are types of endowment plans that return a set percentage of the total sum assured regularly. Let us check two major differences between the term plans and the endowment plans.
With the low-risk feature, Money Back plans are an ideal choice for risk-averse people who are looking for insurance coverage and investment with maturity and income benefits. Make sure you check the features and terms and conditions before buying a money-back plan.
Insurance & Investment
The term plans are complete life covers and provide policy benefits to the nominees after your demise during its duration. Whereas money back policies combine the advantage of investment and life coverage and your nominees get death benefits after your demise or are entitled to the survival benefits. Money back plans provide periodic returns during your policy duration.
Conclusion
Money back plans are fixed return savings plans which guarantee an assured amount to you at the end of the policy term. These plans are apt for investors who do not wish to get exposed to a high degree of investment risk while enjoying the benefits of both wealth appreciation and life insurance.
Also read: Limitations Of Buying Money Back Plans
