Planning To Buy A Money-Back Policy? Here Are Some Tips And Advice That Will Help You In Selecting One
Updated On Sep 17, 2021
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Money-back plans are a form of life insurance policy that pays back the money invested in the plan at regular intervals throughout the policy's term. The money-back amount is calculated as a percentage of the total insured. These monthly payments, sometimes called survivor benefits, are made available after the premium payment term has finished. Periodic payments are made during the policy term, and at maturity, the remainder of the sum guaranteed is paid out plus bonuses, as money back plans are often participation plans. This plan also includes a death benefit, which means that if the life assured dies during the policy term, the nominee receives the sum promised, regardless of any previous periodical survival benefit payouts.
How to Choose the Best Money Back Plan?
Here are some pointers to help you pick the best money-back plan for you:
1. The Ratio of Claim Settlement
Always search for an insurance provider's claim settlement ratio before acquiring a money-back plan, and select an insurance provider with a high claim settlement percentage. The claim settlement ratio compares the number of claims filed to the total number of claims. A high claim settlement ratio of an insurance provider indicates the insurance provider's trustworthiness in the eyes of its consumers.
2. Evaluate Alternatives
Several insurance firms give money return plans; however, before choosing one, it is important to evaluate the various money back plans provided by various insurance providers. This will assist you in making an informed selection, as you will be able to select a plan that not only works within your budget but also meets your insurance needs.
The majority of money-back plans are participating life insurance plans, which means that the insurance provider announces yearly bonuses on the life insurance policy, which are paid along with the death benefit or the maturity benefit. Before acquiring a money-back plan, ensure that it gives a decent percentage of bonus on the insurance. This will assist you in growing your corpus to meet your future financial demands at various periods of your life.
4. Riders or Availability
Choose a money-back plan that includes life insurance riders to help you boost the coverage provided by your basic policy. Riders help to increase the coverage of a life insurance policy, allowing you to get financial assistance in difficult conditions.
5. General Terms and Conditions
It is critical to read the terms and conditions of a life insurance policy to understand what is and is not covered by the policy. Before acquiring a money-back plan, make sure you completely read the policy's terms and conditions to understand how this plan will operate for you.
Money-back policies might help you and your loved ones ensure a financially secure future. Periodic payouts under this sort of plan might serve as an income source to assist you in meeting your future financial demands. In the event of an unfortunate occurrence, your loved ones will get a sum assured, regardless of any previous periodical payouts. This will assist in guaranteeing that your loved ones continue their daily lifestyle and can fulfill their financial needs. If you keep the aforementioned things in mind before purchasing a money-back plan, you will be able to make an educated decision when choosing a money-back plan.
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.