Why Is Money Back Insurance Plan A Must-Buy?
Updated On Nov 05, 2021
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Money Back plans combine the benefits of both insurance and investment into one package. In addition to providing life insurance, they invest a portion of your money in the market. You can also use a Money Back plan to invest in your future ambitions while simultaneously ensuring the protection of your family 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 volatility. For all of these reasons, purchasing a Money Back policy is a secure bet. Continue reading to learn more about these themes!
Advantages of Buying a Money Back Guarantee
Some convincing reasons to consider acquiring a Money Back plan include:
1. Money Back Guaranteed Returns Plans
The guaranteed returns of a Money Back policy allow it to beat market-linked plans. A Money Back guarantee should be considered by everyone looking for a low-risk investment. To be eligible for a Money Back guarantee, the insured must live. In the case of the policyholder's death, the nominee receives the guaranteed money as well as any earned bonuses.
2. Advantage of Survival
When the insurance is in full force, a money return plan pays you a percentage of the amount covered on a regular basis. If you complete the whole insurance term, you will be entitled to maturity benefits as well as any applicable incentives.
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 organize your finances in order to attain various life goals.
4. Risk-Free Profits
If you're afraid of taking chances, a Money Back plan is a great option because it doesn't require you to take any. The insurance promises a profit if the insured lives. In the event that the policyholder dies, the nominee receives the specified amount as well as any earned 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 decided by the insurance company's profitability and the customer's ability to pay all premiums on time.
6. Taking a Tax Deduction
You may be able to claim incentives and tax deductions 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
If the life assured desires to cover aspects of their life that are not already covered by the plan, they may do so by selecting from a variety of extra riders or add-ons. These additional rides might be claimed as a tax-deductible
A Money Back policy is ideal for risk-averse people who want the extra benefit of saving through an insurance plan while still having plenty of cash on hand. If the insured dies, the insurance pays the nominee the whole amount guaranteed, with no deduction from the survivor benefits.
Also read - Pros and Cons of Buying a Money Back Plan