What is the life insurance? It is a life protection plan where people can invest money and get both life and financial protection based on the plan facility. If people are investing for savings or life security, it is the best option. It takes responsibility for both life coverage and money coverage.
What is the life insurance & how it works in easy words
- Life insurance companies offer this based on their premium facility for long-term savings and also cover death benefits. For example, if the primary holder dies, then the family will receive a lump sum amount based on the investment. The amount will be higher as planned when the life insurance was booked.
- Premium terms can be chosen based on your income source. Life insurance companies offer half-yearly and annual payments. It can be negotiable based on the plan and requirement, and you can also pay quarterly or monthly depending on the insurance company and policy terms.
- Premiums are calculated based on the customer’s age, and benefits are given accordingly.
- This kind of plan is not for short-term investment like 2 or 5 years. It usually lasts for more than 10 years, depending on the plan.
- Based on Insurance Regulatory and Development Authority of India (IRDAI) rules, you can surrender the policy prematurely, but it depends on the norms. Customers will receive the amount according to IRDAI rules. It does not offer 100% of the premium amount. This is effective from 1st Oct 2024. Before that, it was not available, and customers were losing the entire amount, but now they can withdraw.
- If customers are investing, they can choose the policy, and the interest rate will be informed and calculated on the first day. That amount will be received on the maturity date along with the premium and interest.
- Customers can buy the policy for marriage plans, child education, pension, family functions, and other activities.
Important notes: –
Before booking the policy, check the proper terms & conditions. Also, ask about the TDS criteria. Do not go through agents; always visit the branch to check all plans – secured and non-secured. After that, you can book the policy.
For applying – http://www.tataaia.com