Money Back Policy is an ideal investment plan to secure the lives of your family members and yourself. Read on to learn about the best Money Back Programs and the details surrounding them.
A money-back insurance policy is a plan that allows the insured to avail the dual benefits of life cover as well as investment. It is an endowment plan that offers the advantage of regular returns at regular intervals during the tenure of the policy.
Let us understand the working of a money back policy with the help of an example:
Suppose you bought a money back plan from a reputed insurer for a term of 20 years. Now, you would start receiving survival benefits a few years into the plan. 20% of the sum assured would be paid as regular income periodically. The balance is paid in the form of maturity at the end of the policy term.
Assured returns – It allows guaranteed money back plan benefit in the form of assured returns periodically during the policy tenure. The returns are pre-decided at the time of policy purchase.
Additional Income –You receive a fixed pay out at regular intervals throughout the policy duration. This amount serves as an extra income to help the insured to fulfill financial goals.
Bonus – Most money back plans also offer an extra pay out in the form of bonus at the end of the policy term.
Accrued returns – you would receive an accrued return in the form of maturity benefit at the end of the policy term.
Added Bonus – An extra income is also received by the policyholder at the end of the policy term.
Second income source – The regular pay will receive by the policy holder as a second source of income
Protection of Life – A money back policy serves the dual purpose of insurance and investment.
Tax Benefits – Te premiums paid under some money back policies are exempted from tax under section 80C of income tax. The benefits received by the insured are also tax free.
Policy seekers of money-back plan are required to meet certain eligibility criteria as listed below:
- Your age should match the minimum and maximum requirement to qualify for the plan
- The minimum and maximum entry age varies depending on policy
- Policyholder must make the premium payment as guided by the policy term