Why Do You Need To Buy A Money Back Plan?
Published On Oct 08, 2021 10:00 AM By InsuranceDekho
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Money-back plans combine the benefits of both insurance and investment into one package. They invest a percentage of your money in the market in addition to providing life insurance. You can also utilize a money-back plan to invest in your future goals while also guaranteeing that your family is protected after your death. Money-back plans have the benefit of being less hazardous than other investment alternatives. They put their money into cash bonds and assets that are immune to market swings. For all of these reasons, purchasing a money-back policy is a secure bet. Continue reading to learn about all these ideas!
Advantages of Buying a Money-Back Guarantee
Some compelling reasons to consider getting a money-back guarantee include:
1. Money-Back Guarantee With Returns
Money-back insurance can trump market-linked plans because of its assured returns. If you're searching for a low-risk investment, a money-back guarantee should be considered. The insured must survive in order to get a money-back guarantee. The nominee receives the promised money as well as any earned bonuses in the event that the policyholder passes away.
2. Survival Advantage
A money return plan pays you a portion of the insured amount on a regular basis while your insurance is in full force. You will be eligible for maturity benefits and any relevant incentives if you finish the whole insurance term.
During the policy duration, the insurer pays a specified percentage of the sum covered at regular periods. This enables you to obtain the necessary cash and better organise your finances in order to attain various life goals.
4. Risk-Free Returns
If you are afraid of taking chances, a money-back plan is a great option for you because it does not entail any risk. If the insured person lives, the insurance company will make a profit. If the policyholder dies, the nominee receives the specified amount as well as any accrued bonuses.
5. Bonuses Might Help You Earn More Money.
Money return insurance also pays the insurer money in the form of a bonus. The incentive is well advertised, and it is calculated as a percentage of the amount of money reimbursed by the insurance company each year. The cumulative bonus is added to the entire amount due when the insurance matures or the insured passes away. The money return plan's incentive component is mostly influenced by the insurance company's profitability and the customer's ability to pay all premiums on time.
6. Taking A Tax Deduction
Incentives and tax deductions may be available to you under Section 80C of the Income Tax Act of 1961, in addition to other benefits such as the death benefit to which your nominee is entitled in the event of your sudden or accidental death and the maturity benefit to which you may be entitled if you complete the term.
7. Additional Riders
The life assured can pick from a range of additional riders or add-ons to cover parts of their life that are not currently covered by the plan. These extra rides might be deducted from your taxes.
If you're in a need, Money-Back Plans could come in handy. You may be confident that your family will be cared for whether or not you are there, thanks to lower risk and guaranteed rewards. To summarise, a money-back plan is the greatest investment option since it offers a variety of benefits such as survival, maturity, tax advantages, death benefits, and other riders that may come in handy in the future.
Also read - Money Back Plan V/S Endowment Plan: Which is Better
Popular Money Back Insurance Plans in 2021
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.