How are Money-Back Plans Different from Other Types of Life Insurance Plans?

To experience both life insurance and saving money, you can invest in money-back policies as they provide you with the best of both insurance and savings. Normal life insurance policies provide sum assured at the maturity of the plan whereas money-back pays out a portion of the sum assured at regular intervals of time after a few years of the beginning of the policy term. Money-back policies are popular amongst those who are trying to save at least a part of their income from the shares they have invested or those with short-term goals or pre-planned goals. 

Money-back policies offer many benefits that make them unique and different than other life insurance plans. The advantages of buying a money-back plan are regular payouts, survival benefit, maturity benefit, death benefit, tax benefit, a long life cover, additional riders, and more. 

Features of Money-Back that Make it Different From the Other Life Insurance Plans

While all the life insurance plans offer benefits that can help you cover your life, money-back offers a little more than them. Money-back is not only a life insurance policy but also a saving instrument because of the following benefits -

1. Maturity Benefit

When the plan reaches its maturity age and the life assured survives the maturity age of the policy, the life assured will receive an amount of the sum assured along with the additional bonuses that can be applied.

2. Survival Benefit

If the life assured survives the whole duration of the policy term, they will receive the sum assured with revisional bonuses and final additional bonuses if any can be applied. 

3. Death Benefit

While the policy is in full force if the life assured dies accidentally before the completion of the policy term and if all the premiums are paid, the nominee or the beneficiary of the policy will receive the total sum assured on death and all the premiums paid prior to death. This will help the family of the life assured to cover the immediate expenses and help them gain financial stability even after you are gone. This benefit makes sure that your family is not left behind with financial bondage to anybody or any organization. The sum assured on death is usually greater than the basic sum assured of the policy.

4. Tax Benefit

All the payments made in these plans are tax-deductible under section 80C of the Income Tax Act, 1961.
Additional Riders

If the life assured wants to choose areas of their life to cover that are not already covered in the plan from the beginning, they are provided a list of additional riders or add-ons to help them cover the areas without a hassle. These riders are also tax-deductible.

Conclusion

Money-back offers different benefits that make it stand out amongst all the other life insurance plans available in the market. These include maturity benefit, survival benefit, tax benefit, and many more. The maturity benefit offered by money-back makes it a saving instrument also.

Also read - Common Riders Available in a Money Back Policy

 Money Back Plan Are The Best Investment Options. Here's Why?

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.