Reasons to Invest in a Money-Back Plan
Updated On Jun 21, 2022
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Are you also confused between investing your money and buying life insurance? Do you also want to plan for the future and also want to see your money grow? Then, money-back plans are the option for you.
There is not a person on the face of this Earth who does not want to see their money grow. And the money-back plans provide life coverage along with giving you an option to invest your money. With this plan, you can see your wealth expanding along with an assurance that you and your family's financial future remains secure. And here, in this article, we will discuss all the reasons why you should take a money-back plan. Let's find out!
First off, what is a money-back plan?
A money-back plan is a very popular insurance plan among Indians. In this plan, all you have to do is purchase a plan based on your needs and then invest in it for a few years. After that, you will start receiving monthly payouts termed 'survival benefits' by the insurance company. As the name suggests, the monthly payouts are the rewards the insurance company gives you for surviving.
The plan gives life coverage to the individual, and if in case some unfortunate event happens and the life insured dies, then the insurance company gives the remaining maturity amount to the nominee. Thereby ensuring the financial stability of your family too.
What are the reasons to invest in a money-back plan?
Some of the reasons why you should consider taking a money-back plan are mentioned below:
1. Regular payouts
Money-back plans give the benefit of regular monthly payouts. You will be required to invest in it for a certain period of time, and once that tenure is over, you will start receiving survival benefits as a reward for surviving the whole time. These benefits will continue until the maturity period.
2. Waiver of the premium for the premium riders
If you have taken a premium rider with your life insurance policy, then in case some kind of unfortunate accident happens, and you die, the remaining premium amount will be waived off. Insurance companies will return the maturity amount to your family, and they will not be required to pay any kind of premium afterwards.
3. Insurance coverage and financial safety
Money-back plans give life coverage to the life insured along with financial safety. The financial safety extends to the family of the life assured as in case you die before the policy has matured, your family will receive the maturity amount regardless of the survival benefits and bonus you have already received. That means, even if you are not there, your family will not have to worry about their financial status. They can take the time to grieve.
4. Tax benefits
Survival benefits, maturity benefits, and any kind of bonuses received from the money-back plans are entirely tax-free. Along with that, a person can avail of a tax exemption of up to Rs. 1.5 lakhs under section 80C of the Income Tax Act, 1961.
Wrapping up
Money-back plans are investment cum insurance plans. You have to invest in the policy for a certain amount of time, and if you survive the tenure, the insurance company will reward you in the form of regular monthly payouts for surviving. This plan also gives your family financial security if something happens to you. Your family will receive the maturity amount. So, if you want an insurance plan that gives monthly returns and also life coverage, then money-back plans are the best deal for you.
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