Benefits of Money Back Insurance Plans

Updated On Jul 02, 2021

Benefits of Money Back Policy
Conclusion

Money Back Policy is a traditional participating Insurance plan which pays out lump sum amounts at the crucial points such as death of the policyholder. It is an ideal financial solution for those who wish to have a saving opportunity as well as a regular source of income in the form of survival benefits to meet regular expenses at the same place. Money Back Policy ensures the policyholder receives guaranteed returns on investment during the policy tenure and provides the policyholder with an opportunity to grow their wealth with investment opportunities.

Money Back Insurance Policy provides low risk investment options along with life coverage facility during the policy tenure to the policyholders. It enables the policyholder to do savings for a long term instead of a short term because long term investment leads to higher interests which help the policyholder to meet future expenses. It is one of the most popular plans in the policy market in India.

In this article, we will go through certain benefits which policyholders can avail after purchasing a Money Back Policy from a well known insurance company.

Benefits of Money Back Policy

There are wide array of benefits available under Money Back Policy which policyholder can enjoy are as follows:

Survival Benefits

These benefits are received by the policyholder after every few years during the tenure of the policy and continue till maturity. Survival Benefits start after a few years from the issue date of the policy. It is calculated as the percentage of sum assured and paid at regular intervals during the tenure.

Maturity Benefits

It is the total amount received by the policyholder at maturity of the Money Back Plan. Maturity Benefits includes the actual sum assured of the policy plus remaining Survival Benefits and Bonuses.

Death Benefits

Death Benefits is provided to the nominee of the policy in case of death of the policyholder. It includes the sum assured irrespective of the payment which has already been paid and vested bonus on the policy. It does not include survival benefits as it is only paid if the policyholder is alive and well.

Bonuses

This additional amount is provided by the insurance company as it is dependent on the performance of the company during the entire tenure or disciplined nature of the policyholder while paying premiums during the tenure.There are two types of Bonuses that are Simple Reversionary Bonus and Terminal Bonus. The former one is declared by the insurance company at the end of every year and added to the total sum payable to the policyholder whereas in the latter one is paid at the end of tenure or as death benefit.

Sum Assured

It is the amount for which policy is taken. It determines the premiums need to be paid by the policyholder during the tenure. Sum Assured is paid to the policyholder at the time of maturity or paid to the nominees if an unforeseen situation occurs.

Conclusion

Money Back Policy is an Endowment Plan which offers secure and safe guaranteed return options to the policyholders during the tenure of the policy. The one who wants to save their money for the long term through low risk instruments along with wealth creation and life insurance can buy a Money Back Policy to meet financial requirements during their lifetime.