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The Different Types of Life Insurance Plans Explained

 
 

The growing insurance market translates into a wide range of products suited to different requirements. If you do not know what you need, the plethora of choices can be overwhelming.

In order to pick the best insurance plan for yourself, you need to start by identifying your financial goals. Apart from this, your disposable income, no. of working years, other assets and savings also influence the choice.

Insurance plans can be broadly divided into three categories:

Protection PlansGrowth PlanRetirement Plans
What does it offer?Protection plan such as a  term insurance plan, is the most basic type of life insurance where the focus is on the core proposition of insurance i.e. protectionA Growth plan, such as Child Plan, Savings Plan allows investment along with insurance coverA Retirement plan offers a combination of protection and savings, helping you build a corpus for your retirement years
Who should you buy it?Ideal to financially safeguard your family and protect them against long-term liabilities like home loansIdeal to safeguard your family and create wealth for specific goals and milestonesIdeal to create long term savings, that can be withdrawn like monthly pension at retirement
How does it works?You pay premiums, for a fixed no. of years, and in return, the insurance company offers you a life cover for that termYou pay premiums, for a fixed no. of years, and in return, the insurance company offers you a life cover and invests a significant part of the premium in funds. The returns can be availed either on maturity or at predetermined time intervals
Types availableYou can decide to opt for
i) Simple lumpsum payout to cover immediate liabilities
ii) Lumpsum + monthly income option to cover living expenses
iii) Or lumpsum + increasing monthly income option to cover against inflation
You can choose from Growth plans, Savings plans, and Child plans based on your needYou can choose from Immediate annuity plans, deferred annuity plans, etc
Core BenefitA large sum of life cover for a cost-effective premiumCompared to a protection plan, these offer a smaller cover for the same premium. However, the focus is also on returns

If you are planning to purchase a Protection Plan, consider the Max Life Online Term Plan Plus for a high cover.

In addition, there are a number of Wealth Plans you could choose from, such as the Max Life Fast Track Super plan or the Max Life Guaranteed Income Plan for savings and growth.

Check out the Max Life Forever Young Pension Plan to invest towards your retirement years.

 
 
 

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