Which one is best one......
- Thread starter Nail Ramp
- Start date
Hi,
No need to get confused. Let me explain;
Basically there are two types of life insurance available.
A. Endowment Insurance Policy.
B. Unit Linked Insurance Policy.
Endowment Policies can further be categorised into:
a. Pure Endowment Insurance Ploicy.
b. Money Back Insurance Policy.
Now Pure Endowment Insurance Policy is the cheapest of all, since it has no Maturity Value i.e. Only Death Benefit during the policy term. If you survive the entire policy term till maturity, you do not get any money in refund.
Money Back Insurance Policy, on the other hand, assure certain guaranteed return plus bonuses (non guaranteed) on maturity i.e. if you survive the policy term. In case of death during the term, you get Death Benefit.
Unit Linked Insurance Plans are modern day products, which gives you life insurance cover along with investment.
Just like in mutual funds, in ULIP, units are allotted to you on every premium payment which is invested in particular fund opted by you. On Maturity, NAV of the fund invested in, muliplied by no of units you hold, would be your maturity value.
Money invested in ULIP thus have direct exposure to equity markest, bonds, money markets, govertment securities, etc and therefore carries risk of loss, which is subject to market fluctuations. In ULIP you can expect market rate of return, but you carry market risks as well, since there is no guaranteed benefit, except for the Death Benefit.
Further, there are various kind of charges incurred in ULIP, like Premium Allocation charges, Mortality charges, Fund Management Charges, Policy Administration charges, etc. and it varies from company to company and from product to product.
Tax Benefit u/s 80C and 80D of Income Tax is available in both endowment as well as ULIP.
Both endowment and ULIP have thier own pros and cons. Depending on your insurance/investment need and risk appetite you can choose your insurance policy.
Hope this helps you clarify doubts to an extent.
Regards
No need to get confused. Let me explain;
Basically there are two types of life insurance available.
A. Endowment Insurance Policy.
B. Unit Linked Insurance Policy.
Endowment Policies can further be categorised into:
a. Pure Endowment Insurance Ploicy.
b. Money Back Insurance Policy.
Now Pure Endowment Insurance Policy is the cheapest of all, since it has no Maturity Value i.e. Only Death Benefit during the policy term. If you survive the entire policy term till maturity, you do not get any money in refund.
Money Back Insurance Policy, on the other hand, assure certain guaranteed return plus bonuses (non guaranteed) on maturity i.e. if you survive the policy term. In case of death during the term, you get Death Benefit.
Unit Linked Insurance Plans are modern day products, which gives you life insurance cover along with investment.
Just like in mutual funds, in ULIP, units are allotted to you on every premium payment which is invested in particular fund opted by you. On Maturity, NAV of the fund invested in, muliplied by no of units you hold, would be your maturity value.
Money invested in ULIP thus have direct exposure to equity markest, bonds, money markets, govertment securities, etc and therefore carries risk of loss, which is subject to market fluctuations. In ULIP you can expect market rate of return, but you carry market risks as well, since there is no guaranteed benefit, except for the Death Benefit.
Further, there are various kind of charges incurred in ULIP, like Premium Allocation charges, Mortality charges, Fund Management Charges, Policy Administration charges, etc. and it varies from company to company and from product to product.
Tax Benefit u/s 80C and 80D of Income Tax is available in both endowment as well as ULIP.
Both endowment and ULIP have thier own pros and cons. Depending on your insurance/investment need and risk appetite you can choose your insurance policy.
Hope this helps you clarify doubts to an extent.
Regards
Last edited:
Yeah thanks all of you(repliers) those really give me your precious time and valuable suggestions those are really work for me. Currently in market there are many life insurance companies provide life insurance policies and services, i just gone through LIC and Bharti-AXA Life both are comparatively providing security and protection in terms of investment so just let me know from all of you experts that which one is beneficial and why?.....and i am actually from Maharashtra- Mumbai..
Waiting for your response ...
Waiting for your response ...
Hi!
This is my first post in this forum.
Excluding Endowment Insurance Policy & Unit Linked Insurance Policy there is another insurance policy called Term Policy. Features of this policy -
1. Cover only risk (Life of insured Person)
2. Low premium.
3. No money back
4. Different riders available.
5. Tax benefit as usual u/s 80 C and 10 (10 D) of IT Act.
Advantage of this policy is that premium is very low. For example, A 30 years old person require a life insurance policy of Rs. 5,00,000/-.
In case of Endowment Insurance Policy & Unit Linked Insurance Policy he has to pay Rs. 25,000/- (approx.) per annum irrespective of term. But in term policy he pays only Rs. 2700/- (approx.) per annum.
In case of Endowment Insurance Policy & Unit Linked Insurance Policy he has to pay huge hidden administrative charges and he also has to pay premium for at least 3 years. If he unables to continue it for 3 years you will not get any benefit other than your risk coverage. But in Term policy he has nothing to loose, if he pays premium his risk will be covered otherwise not.
If the aforesaid person take Term policy then he has liberty to invest rest of the money (Rs. 22,000/-) of his own choices like FD, MIS, PF, PPF, Bonds, MFs (MFs of your own choices but not your insurer's choice) Stocks or wherever you like! If you invest yourself you will get much better return according to your risk appetite.
He can take insurance policy of more sum insured as premium is low and he will not has a headache at the end of the year to pay a big value premium.
Moreover, In SBI Life there is a option where one can increase sum insured every year by 5% which may soak a part of inflation.
Insurance companies and their agents never promotes this policy as profit or commission is much less due to low premium.
So. if you are planning to buy a Life Insurance Policy at least think once for Term Policy.
During purchase only thing you have to compare the premium amount for the same sum insured and maximum age of life or years it covers.
More or less all Insurance companies (LIC, HDFC Standard Life, SBI Life etc.) sell Term Policy.
If any more questions you are free to ask.
Regards
This is my first post in this forum.
Excluding Endowment Insurance Policy & Unit Linked Insurance Policy there is another insurance policy called Term Policy. Features of this policy -
1. Cover only risk (Life of insured Person)
2. Low premium.
3. No money back
4. Different riders available.
5. Tax benefit as usual u/s 80 C and 10 (10 D) of IT Act.
Advantage of this policy is that premium is very low. For example, A 30 years old person require a life insurance policy of Rs. 5,00,000/-.
In case of Endowment Insurance Policy & Unit Linked Insurance Policy he has to pay Rs. 25,000/- (approx.) per annum irrespective of term. But in term policy he pays only Rs. 2700/- (approx.) per annum.
In case of Endowment Insurance Policy & Unit Linked Insurance Policy he has to pay huge hidden administrative charges and he also has to pay premium for at least 3 years. If he unables to continue it for 3 years you will not get any benefit other than your risk coverage. But in Term policy he has nothing to loose, if he pays premium his risk will be covered otherwise not.
If the aforesaid person take Term policy then he has liberty to invest rest of the money (Rs. 22,000/-) of his own choices like FD, MIS, PF, PPF, Bonds, MFs (MFs of your own choices but not your insurer's choice) Stocks or wherever you like! If you invest yourself you will get much better return according to your risk appetite.
He can take insurance policy of more sum insured as premium is low and he will not has a headache at the end of the year to pay a big value premium.
Moreover, In SBI Life there is a option where one can increase sum insured every year by 5% which may soak a part of inflation.
Insurance companies and their agents never promotes this policy as profit or commission is much less due to low premium.
So. if you are planning to buy a Life Insurance Policy at least think once for Term Policy.
During purchase only thing you have to compare the premium amount for the same sum insured and maximum age of life or years it covers.
More or less all Insurance companies (LIC, HDFC Standard Life, SBI Life etc.) sell Term Policy.
If any more questions you are free to ask.
Regards
Last edited:
Hi,
I could not understand "security and protection in terms of investment". As far as i know, there is no 100% protection in investment linked insurance products. And if there is such product, returns are nominal.
Which product or insurance provider to choose, is completely at ur discretion.
Since I am associated with Bajaj Allianz, I am providing example in their products. This is just for the purpose of understanding.
Assume a persons age is 30 and wants life insurance as well as investment growth.
Take a Term Plan (with return of Premium on Maturity)
Insurance Cover: Rs.10,00,000
Term: 35 Years
Annual Premium: Rs.15,000 (approx)
Maturity Value: Rs.5,00,000 (approx)
Take a ULIP (35% Equity Fund, 35% Index Fund, 30% Bond Fund)
Insurance Cover (20times): Rs.17,00,000
Term: 35 Years (You may stop paying after 3rd year, however growth will vary accordingly)
Annual Premium: Rs.85,000
Maturity Value: Between (6%) Rs.70,00,000 and (10%) Rs.1,69,00,000
Summary:
Tota Premium: 1,00,000 per annum x 35years = Rs.35,00,000
Term: 35 Years
Maturtiy Value: (a)Rs.5,00,000 + Rs. 70,00,00 = Rs.75,00,000
(b) Rs.5,00,000 + Rs.1,69,00,000 = Rs.1,74,00,000
Insurance Cover: Rs.10,00,000 + Rs.17,00,000 = Rs.27,00,000
This is just my perspective of balancing insurance and investment. Instead of ULIP you can invest in mutual funds.
Hope this helps.
Regards
I could not understand "security and protection in terms of investment". As far as i know, there is no 100% protection in investment linked insurance products. And if there is such product, returns are nominal.
Which product or insurance provider to choose, is completely at ur discretion.
Since I am associated with Bajaj Allianz, I am providing example in their products. This is just for the purpose of understanding.
Assume a persons age is 30 and wants life insurance as well as investment growth.
Take a Term Plan (with return of Premium on Maturity)
Insurance Cover: Rs.10,00,000
Term: 35 Years
Annual Premium: Rs.15,000 (approx)
Maturity Value: Rs.5,00,000 (approx)
Take a ULIP (35% Equity Fund, 35% Index Fund, 30% Bond Fund)
Insurance Cover (20times): Rs.17,00,000
Term: 35 Years (You may stop paying after 3rd year, however growth will vary accordingly)
Annual Premium: Rs.85,000
Maturity Value: Between (6%) Rs.70,00,000 and (10%) Rs.1,69,00,000
Summary:
Tota Premium: 1,00,000 per annum x 35years = Rs.35,00,000
Term: 35 Years
Maturtiy Value: (a)Rs.5,00,000 + Rs. 70,00,00 = Rs.75,00,000
(b) Rs.5,00,000 + Rs.1,69,00,000 = Rs.1,74,00,000
Insurance Cover: Rs.10,00,000 + Rs.17,00,000 = Rs.27,00,000
This is just my perspective of balancing insurance and investment. Instead of ULIP you can invest in mutual funds.
Hope this helps.
Regards
Thanks Man!
Nice observation, term plan is best without headache and rest of the money we can invest as per our own wish. Great Idea
Best Insurance = Term Plan + Investment in instrument chosen by you i.e. bonds/ MF's/Stocks (not by those leach insurance company who can suck your all blood on the name of ULIP.)
Thanks again
Nice observation, term plan is best without headache and rest of the money we can invest as per our own wish. Great Idea
Best Insurance = Term Plan + Investment in instrument chosen by you i.e. bonds/ MF's/Stocks (not by those leach insurance company who can suck your all blood on the name of ULIP.)
Thanks again
Last edited:
you can also check out igain from Bajaj Allianz http://www.buyigain.com
Some of the features (taken from it's website)
1. Investor Selectable Portfolio Strategy For the investment savvy guy who knows the tricks of the trade. You can choose the funds you want to invest in.
2. Wheel Of Life Portfolio Strategy For those who find investing and insuring as Greek and Latin. Our investment officers will select and invest in the appropriate funds to balance and safeguard your investment. This smart strategy is a first of its kind from the house of Bajaj Allianz Life created especially for you.
3. iGain gives you the flexibility to switch your money between various funds at your will. (Mimimum amount of Rs 5000)
4. If you receive surplus money (a Diwali bonus, for example), you can pay a lump sum amount as premium to increase your investment. (Mimimum amount of Rs 5000)
5. If you require money urgently, you can also withdraw money from your policy account. (From the 4th year onwards)
6. The premiums you pay towards iGain are eligible for tax as per Section 80C and Section 10(10)D of the Income Tax Act.
Some of the features (taken from it's website)
1. Investor Selectable Portfolio Strategy For the investment savvy guy who knows the tricks of the trade. You can choose the funds you want to invest in.
2. Wheel Of Life Portfolio Strategy For those who find investing and insuring as Greek and Latin. Our investment officers will select and invest in the appropriate funds to balance and safeguard your investment. This smart strategy is a first of its kind from the house of Bajaj Allianz Life created especially for you.
3. iGain gives you the flexibility to switch your money between various funds at your will. (Mimimum amount of Rs 5000)
4. If you receive surplus money (a Diwali bonus, for example), you can pay a lump sum amount as premium to increase your investment. (Mimimum amount of Rs 5000)
5. If you require money urgently, you can also withdraw money from your policy account. (From the 4th year onwards)
6. The premiums you pay towards iGain are eligible for tax as per Section 80C and Section 10(10)D of the Income Tax Act.
IGAIN from Bajaj Allianz is a good product. Following is the info taken from it's website (http://www.buyigain.com)
1. Investor Selectable Portfolio Strategy For the investment savvy guy who knows the tricks of the trade. You can choose the funds you want to invest in.
2. Wheel Of Life Portfolio Strategy For those who find investing and insuring as Greek and Latin. Our investment officers will select and invest in the appropriate funds to balance and safeguard your investment. This smart strategy is a first of its kind from the house of Bajaj Allianz Life created especially for you.
3. iGain gives you the flexibility to switch your money between various funds at your will. (Mimimum amount of Rs 5000)
4. If you receive surplus money (a Diwali bonus, for example), you can pay a lump sum amount as premium to increase your investment. (Mimimum amount of Rs 5000)
5. If you require money urgently, you can also withdraw money from your policy account. (From the 4th year onwards)
6. The premiums you pay towards iGain are eligible for tax as per Section 80C and Section 10(10)D of the Income Tax Act.
1. Investor Selectable Portfolio Strategy For the investment savvy guy who knows the tricks of the trade. You can choose the funds you want to invest in.
2. Wheel Of Life Portfolio Strategy For those who find investing and insuring as Greek and Latin. Our investment officers will select and invest in the appropriate funds to balance and safeguard your investment. This smart strategy is a first of its kind from the house of Bajaj Allianz Life created especially for you.
3. iGain gives you the flexibility to switch your money between various funds at your will. (Mimimum amount of Rs 5000)
4. If you receive surplus money (a Diwali bonus, for example), you can pay a lump sum amount as premium to increase your investment. (Mimimum amount of Rs 5000)
5. If you require money urgently, you can also withdraw money from your policy account. (From the 4th year onwards)
6. The premiums you pay towards iGain are eligible for tax as per Section 80C and Section 10(10)D of the Income Tax Act.
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