Investing in life insurance for investment purposes is a smart move that can help you protect your assets and boost your income. This article will discuss the benefits of investing in life insurance for investment. Investing in life insurance for investment is a great idea for people who want to make sure that their family will be taken care of after their death. This is because the money can be used to create an inheritance that can take care of the future needs of the heirs.
People should invest in life insurance because they want a better chance at achieving financial independence and freedom. Investing in life insurance is a good investment because the cost of old age and disability will be covered by the policy. This could be very beneficial because it can help people use their money on things that will create more value, rather than worry about how to provide for themselves and their future children with the money they have now.
What is an Investment Life Insurance Plan?
The Investment Life Insurance Plan is a type of life insurance that can be purchased by an individual or group. An investment life insurance plan is a contract between the insurer and the insured that provides the opportunity for wealth creation by investing over some time and getting guaranteed returns. Life insurance companies offer various investment plan options for wealth creation.
Types of Investment Plan Options in India
The types of life insurance plans for investment differ depending on the amount of risk and return that an investor is looking for. Some investors may choose a plan with low risk and high return, whereas others may be more concerned about low risk with low to medium returns. There are many types of life insurance plans for investment.
- Unit Linked Investment Plans
- Endowment Life Insurance Plans
- Money Back Life Insurance Plans
- Public Provident Funds
- Fixed Deposits
- Mutual Funds
- National Pension Scheme
- National Savings Certificate
- Tax Saving Mutual Funds
Unit Linked Life Insurance Plans
Unit Linked Life Insurance Plans (ULIPs) are a type of life insurance plan where the death benefit is linked to the investment. They are often offered by insurance companies in the form of savings accounts or investment plans. The idea behind ULIPs is that the death benefit will be paid to your loved ones if you die before your investment matures. However, if you live beyond the maturity date, then you will receive a higher return on your investment than if you had died at any point during the policy term.
Endowment Life Insurance Plans
An endowment life insurance plan is an investment plan that is designed to provide a regular income for the investor. An Endowment policy is a life insurance plan that apart from covering the life of the insured against uncertain death helps to save a certain amount of money regularly over some time. In short, an endowment policy consists of both the Insurance coverage and the Savings option.
Money Back Life Insurance Plans
Money Back life insurance policy as the name suggests returns the money invested by the policyholder. In a money-back plan, the policyholder can get a certain percentage of amounts at regular intervals, instead of getting the lump sum amount at the end of the term. It can be termed as the endowment plan with a liquidity option. The money-back plan also provides a sum assured at the time of death of the policyholder or on the maturity of the policy apart from the money withdrawn at regular intervals.
Public Provident Funds
Public provident funds are the most popular investment option. These are funds that are managed by the government and a part of your contribution is invested in various stocks and bonds. They offer a great way to save money for future needs. It offers a lower rate of interest than other banks or financial institutions, but it is still better than any other savings options available in India. Public provident funds can be used to accumulate wealth over time without having to worry about inflation or the value of your money.
Fixed deposits are a type of savings account in which the money is deposited for a fixed period. The depositor can withdraw the money anytime during this fixed period. This type of investment is popular because it offers a higher interest rate than other types of savings accounts, as well as the peace of mind that comes with knowing that your money will not be lost if you need to withdraw before the fixed period ends.
Mutual funds are a type of investment that pools money from many investors and invests it in stocks, bonds, or other securities. They can be used for investing in long-term savings or for trading short-term investments. Mutual funds are also known as open-ended mutual funds because they can buy and sell anything on the market.
National Pension Scheme
The National Pension Scheme (NPS) is a state-sponsored retirement savings scheme in India. It was designed to provide pensions to individuals without any contribution from the individual. The NPS scheme is administered by the Pension Fund Regulatory and Development Authority of India (PFRDA).
National Savings Certificate
National savings certificates are a way for people to save for their future. They have many advantages like tax-free interest, low rates of interest, and easy access. The National Savings Certificate is a type of savings account that has a fixed rate of interest. It is not subject to withholding taxes or other fees like bank accounts or credit cards. The National Savings Certificate also has the advantage of being accessible at any financial institution in the country as it is not tied to one institution.
Bonds are a form of debt that is issued by a company or government to raise funds. The reason why companies issue bonds are because they have a large amount of capital that they need to invest. Bonds are typically used by companies to finance their projects or expand their business. Bonds can be used for different purposes such as financing real estate, public infrastructure, and private equity investments.
Tax Saving Mutual Funds
Tax-saving mutual funds are a great way to save on taxes. They are also a great way to diversify your investment portfolio. A tax-saving mutual fund is an investment product that allows investors to earn a return on their investments while reducing or eliminating their tax liability. They are typically offered by banks, insurance companies, and other financial institutions. Some individuals may invest in them as well if they have the means to do so.
Benefits of Investment Plans
Investment Life insurance plans are a type of life insurance policy that provides the opportunity to invest in assets. This type of plan is beneficial because it allows the owner to earn interest from their investments, which can be used to pay for their retirement.
- Financial Protection: Investment plans provide financial protection for the future. They are a very flexible tool for people who want to save for their retirement, children’s education, or other long-term goals and also take care of the family financially as both Survival and Death Benefits are provided.
- Death Risk Coverage: Investment plans provide death risk coverage. The plans are designed as a savings strategy to help people mitigate the risks of unexpected expenses.
- Tax Benefits: Investment plans are not only risk cover or wealth creation plans, but these plans also help in tax savings. Premiums and payout are exempted from tax as per sections 80C and 10(10D) of the income tax act law 1961.
- Wealth Creation:- Investment insurance plans are an option to help people create wealth. Investment insurance plans provide a guarantee on your investment. It means that if you invest in a company, your investment will be protected in case of any financial crisis or natural disaster. It also helps in the future, when you would require funds for a child’s education, child’s marriage, retirement, pension, etc. life insurance investment plans will financially aid you.
- Loan Facility: You can take a loan from the investment life insurance plans in case of emergency. But the rate of interest differs from one company to another company.
- Rider Benefits: There are different types of life insurance rider benefits available to add to your investment plans such as critical illness cover, accidental death benefit, waiver of premium rider, etc.
Best Investment Life Insurance Plans in India
There are a lot of life insurance plans in the market, but not all of them are worth investing in. Here is a list of the best investment life insurance plans in India.
|AEGON iInvest Plan
||7 to 55 years
|Bajaj Allianz Future Gain Plan
||18 to 60 years
|HDFC click2 invest plan
||30 days to 65 years
||5 to 20 years
|ICICI Pru Smart Life Plan
||20 to 55 years
||20 to 65 years
||10 to 25 years
|Edelweiss Tokio Guaranteed Income Plan
||0 to 60 years
||5 to 25 years
|Kotak Invest Maxima Plan
||0 to 65 years
||10 to 30 years
|SBI eWealth Plan
||18 to 50 years
||10 to 30 years
|TATA AIA Wealth Maxima Plan
||30 days to 60 years
||100-age of entry
*Above data is given for illustration purposes only* please refer to our website for exact premiums.
How to Choose Investment Plans in India?
Investment plans are a good way to invest your money and earn returns on it. However, choosing the right investment plan is not easy. To help you choose the best investment plan for you, this article provides you with some tips to go through before investing in an investment plan.
- Evaluate your Financial Needs
- Research the company
- Understand your risk appetite
- Assess your Investment Timeline
- Create a Strategy
- Evaluate Policy Term
- Compare Features & Benefits
- Diversify Investments
- Monitor Investments Periodically
Factors to Consider before Buying Investment Life Insurance Plan
An investment life insurance plan is a type of insurance plan which covers the investment risk. This type of insurance is purchased by individuals who are investing their life savings in the stock market and want to protect their investments. Several factors should be considered before buying an investment life insurance plan: -
- Level of Risk Protection
- The Type of Policy You Need
- The Amount You Need To Invest
- How Long Do You Want Your Investment to Last
- Health Condition
What is the Right Time to Buy an Investment Plan?
The right time to buy an investment plan is when you need the money and you’re not in a hurry. You should also be able to afford the monthly fees with your current income. Investment plans are a good way to save for your retirement or other financial goals, but they're not a good idea if you're just starting and don't have much money.
Although everyone has their own set of financial goals, it can often be hard to meet these goals in today's world. Smart investment planning is the key to reaching these goals on a tight budget. To achieve financial objectives like purchasing a house or financially securing your retirement future, you must invest in investment plans. The earlier you will start investing in the future, the more time you will get to create the financial corpus.
Documents Required for Buying Investment Plan
Below are the documents required for buying an investment plan:-
||Salary Pay slips, Income Tax Returns, Bank Statement
||Aadhaar card, Pan Card, Voter Card, Passport
||Aadhaar card, voting card, passport, driving license, etc.
||PAN card, Aadhaar card, voting card, etc.
How to Buy an Investment Plan Online in India?
It is not easy to find a reliable investment plan online. There are so many plans available and it can be confusing to know which one to choose. With an investment comparison tool available online, you can easily compare investment plans and their features. The comparison of different investment plans will get you quotes spontaneously. You can easily compare, differentiate, and choose the best investment plan that suits your requirement. It will save you money and time.
Here are the steps to purchase an investment plan online at PolicyBachat:
- Visit the official website of the PolicyBachat
- Fill in the requested details such as age, gender, income, etc.
- Select the desired options by comparing different premium quotes.
- Select the suitable plan with the premium quote
- Pay for your Policy by using online payment methods.
Insurance is a big decision for any individual. It is important to know that there are many different types of investment life insurance plans out there that you can choose from and it is important to understand what type of plan you are looking for to make an informed decision when it comes time to invest in a long-term plan.
To make a better decision on an investment plan, you should make sure that you have all the information about investment life insurance plans available in the market. However, this decision has become much easier with the help of PolicyBachat. To buy the best investment life insurance policy compare life insurance quotes and get the right life policy now.
FAQs of Life Insurance for Investment
What Is the Best Investment Plan?
Investment is an important part of any individual’s financial plan. The best investment plan depends on the individual and their needs. The best investment plan is one that is tailored to the individual and their needs. This means that it should be something that they can handle with ease, so it's not too stressful for them to follow through with.
Investment plans can vary quite a bit, depending on the person’s age, what they want to invest in, and how much time they have to invest in it. Investing in stocks or mutual funds might sound like a good idea if you have more time than money but if you are just starting, then investing in index funds might be better suited for you.
Is Life Insurance a Good Investment for Retirement?
Life insurance is a type of insurance that pays out a lump sum or an annuity if the policyholder dies. Many people may be hesitant to invest their money in life insurance because they believe that it's not worth the risk. However, there are many benefits to investing in life insurance for retirement purposes. Some of those benefits include tax-deferred investment, lower risk, and guaranteed income.
Which Is the Best Investment Plan in India?
There are many investment plans in India that can help you to reach your financial goals. However, choosing the right one can be quite difficult. Some of these plans are:
- Equity mutual funds
- Debt mutual funds
- Tax saving schemes
- Insurance schemes, etc.
Is Life Insurance a Good Investment for Young Adults?
Life insurance is a good investment for young adults, but it is not always easy to purchase. Life insurance provides financial protection and peace of mind, but it also comes with some risks. Young adults should carefully consider their options before purchasing life insurance to make sure they're getting the best deal possible.
How to Invest In Life Insurance for Tax Benefit
Life insurance is an investment that is meant for the future. It provides a death benefit, which can be used to help with financial and emotional needs. Life insurance premiums are tax-deductible, but you have to invest in them within a certain time. Investing in life insurance can offer tax benefits, depending on the type of life insurance you buy.
Is Whole Life Insurance a Good Investment for a Child?
Whole life insurance is a type of permanent insurance that offers peace of mind and financial security. The policy is designed to provide coverage for a lifetime and can be used to fund a college education, retirement, or any other financial goal. Whole life insurance is a good investment for children who are dependent on their parents. They are not able to take care of themselves financially and need help from their parents.