What is a Money Back Plan?
You could choose a product that brings two worlds together. Therefore, a money-back policy is a gift you can give yourself. A money-back insurance policy provides coverage as well as ensures that you shall get income at regular intervals to satisfy your financial needs.
You may get a money-back plan for a certain period of time; you'll have to pay premiums on a periodic basis as per the plan features being offered by an insurer. In the event that you die, your nominee will receive a lump-sum payment known as the death benefit. When your policy matures, you will be paid the lump sum, plus any additional benefits like bonus, if declared by the Insurer, which you may be eligible for.
Why should you buy a money back plan?
A Money Back plan is a kind of investment plan. Depending on the type of plan, you'll will be eligible for a survival benefit, a maturity benefit, and bonuses, if declared by the insurance company. Money back plans are important because they pay out money at regular intervals until the insurance term ends. In today's turbulent environment, where things change swiftly, ups and downs may occur without notice. There is no problem when everything is going nicely. It's when things take a sharp turn for the worst, and you find yourself bankrupt. You should start developing a corpus to aid your development and success. You may wish to save money for a number of reasons, like investing in your company every few years, paying for your child's education, and so on.
Who should invest in a Money Back Plan?
Money-back plans are suitable for people who want to make low-risk investments, those who want both wealth creation and life insurance coverage, and those who want to be paid at regular intervals throughout the policy term to fulfil certain conditions.
These plans are a good alternative for those who require money on a regular basis, such as for a child's education. People often utilise these schemes to save money on taxes also. So, if you need to save money on taxes, you may acquire these plans where the premiums paid are eligible for deduction under Section 80C of the Income Tax Act of 1961 subject to provisions stated in the act.
To get the suitable money-back policy, you must first verify the policy wordings for qualifying conditions.
5 Unique features of Money Back Plan
● Liquidity:
You will have liquidity with this plan since you will be paid on a regular basis. This enables you to better plan and manage your financial demands, both now and in the future.
● Survival benefits:
A money return plan may give you a portion of the amount guaranteed depending on the product terms and conditions. If you make it through the policy term, you will be entitled for maturity benefits. You will also be entitled to Survival benefits in the form of any periodic pay-outs that you may be qualified for in between policy term.
● Insurance coverage:
Because money back plans are both an insurance and an investment product, they provide you the best of both worlds. If anything, unfortunate occurs to you, your nominee will get the guaranteed amount, regardless of the periodic payment you've been receiving. A money back plan not only enables you to develop your money and get a periodic income to meet your requirements, but it also safeguards your family financially in the event that you are no longer alive.
● Bonus:
Depending up on the product opted for and its underlying conditions, it may provide you a bonus, if declared by the insurance company. This may be considered an extra advantage, and it is always wise to obtain a money back plan from a reputable insurance provider.
Wrapping Up
Going by the above, you may consider getting a money back plan for yourself if you are seeking for a product that offers insurance coverage while also assisting you in building a corpus. A money back policy is a suitable alternative for you if you have no taste for risks and want a periodic income paid to your account.
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