Do You Need A Money-Back Policy?
Published On Sep 19, 2021 10:00 AM By InsuranceDekho
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A money-back plan not only offers coverage but also guarantees that you will receive a specific amount of money each month to fulfill your requirements. You can acquire a money-back plan for a specified length of time, but you will have to pay monthly fees. This plan is excellent for those who have a low-risk tolerance and are searching for an insurance plan that allows them to manage their resources while still allowing liquidity. In the event of an unanticipated occurrence, such as the untimely death of the life guaranteed, regardless of regular payments made during the policy duration, a death benefit would be paid to the nominee.
Why Do You Need a Money-Back Plan?
A money-Back plan, also known as a savings plan, can help you provide for yourself and your family. When things don't go as planned in the financial area, a money-back plan might assist you to recover funds every month until the insurance term expires. Overall, money-back programs are the most trustworthy ways to save.
Here are a few reasons why you should get a money-back guarantee:
1. Life Insurance
While money-back plans are the best way to reduce expenses, they also include a life insurance policy that protects the policyholder and their family from the unpredictability of life.
Must Read: Salient Features Of Money Back Policy
2. Surviving Benefits
A money-back plan provides survivorship benefits in the form of a percentage of the guaranteed amount. The survival benefit, together with the maturity benefit and cumulative bonus, is paid out regularly.
The main advantage of a money-back policy is that it pays a percentage of the cash assured. Throughout the policy's duration, this money is paid at regular intervals. This feature aids in the resolution of the issue of required liquidity, allowing one to better manage their money to reach all financial goals without compromising on any aspect.
4. Risk-free Returns
If you are not willing to incur risks, a money-back plan is a good choice for you. Because there is no risk, the best money-back policy may be chosen depending on personal preferences.
If your insurance company makes a profit, you may be eligible for a bonus. This may be considered an extra benefit, and it is always preferable to get a money-back guarantee from a reputable insurance company.
6. Tax benefits
In addition to the death benefit due to your nominee in the case of your untimely death and the maturity benefit payable to you, if you survive the term, you are also entitled to receive tax benefits under Section 80C of the Income Tax Act of 1961.
7. Additional Riders
If the life assured wants to cover parts of their life that are not already covered in the plan from the start, they may choose from a list of extra riders or add-ons. These additional rides are tax-deductible as well.
To summarise, a money-back plan is the best investment option since it provides various efficient benefits such as the survival benefit, maturity benefit, tax benefit, death benefit, and other riders that can help you in times of need. Furthermore, under this plan, one obtains a guaranteed return on investment as well as the opportunity to diversify their wealth through investment opportunities. With the information supplied above, it should be clear that this is an excellent plan for anyone who wants the benefits of both protection and a consistent source of income.
Also Read: Are Money Back Policies Productive?
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.