Benefits of Purchasing Money Back Policy
Updated On Apr 26, 2021
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Money-back plans are a blend of life insurance and investment. This plan lets you avail the benefit of periodic payout throughout the policy term which helps you meet your financial requirements at different stages of your life. Before purchasing a money-back plan is necessary to know what a plan is and what are its benefits.
What are Money-Back Plans?
Money-back plans are a type of life insurance plans which offer life cover along with an investment option. This plan offers ‘survival benefit’ which are periodical payouts made to the life assured during the policy term till the time of maturity and rest of the sum assured is paid at the maturity date. These periodical payouts are calculated as a certain percentage of the total sum assured. In case of an unfortunate demise of the life assured, the sum assured is paid to the beneficiary irrespective of survival benefit payouts.
Also Read:- Which Plan Gives Guaranteed Income for Life?
Benefits of Money-Back Life Insurance Policy
Following are the features and benefits of money-back life insurance plans:
1. Periodical Payouts
Money-back life insurance plans are known to provide some percentage of the total sum assured during the policy term in regular intervals. The amount received on the regular intervals can act as an income source for the policyholder and his/her family members.
2. Maturity Benefits
On the maturity date of the money-back life insurance plan, the policyholder receives the total sum assured and the accumulated bonus after deducting the amount received on the fixed intervals during the policy term. The maturity benefit consists of the sum assured along with the accumulated bonus.
3. Death Benefits
Under the money-back life insurance plan, if the policy holder passes away during the policy tenure the nominee will receive the total sum assured, even if the policyholder has already received periodical amounts on fixed intervals. The death benefit consists of the total sum assured amount along with accumulated bonus, no deductions of amounts paid earlier on fixed intervals is made on the total assured to be paid out to the nominee.
4. Wealth Appreciation
Money-back plans are usually participating life insurance plans where the insurance company provides a bonus amount as a pre-decided percentage of the total sum assured amount, to the policyholder. The bonus is provided to the policyholder depending on his regular premium payments.
5. Additional Riders
The policyholder can choose to opt for additional riders such as critical illness rider, accidental death rider etc. to enhance the coverage of their money-back life insurance plan.
Conclusion
Money-back plans help in ensuring a financially secure future for you and your loved ones. Periodical payouts under this type of plan can act as an income source which can help you meet your future financial needs. In case of an unfortunate event your loved ones will receive a sum assured irrespective of all the periodical payouts made earlier, this will help in ensuring that your loved ones maintain their daily lifestyle and are able to meet their financial requirement.
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