It’s often said that your health is your wealth. And with the same belief, we make it our mission to ensure that your health is never compromised. That’s why we offer you an array of flexible plans to protect your health.
What is Whole Life Insurance?
A whole life insurance policy or permanent life insurance provides life coverage until the death of the life assured. The policy stays in force throughout the life as long as the life assured pays the premium. The sum assured or the coverage is decided at the time of policy purchase and is paid to the nominee at the time of death claim – when the life assured dies.
Usually, the maturity age is 100 years. If the life assured dies before the age of 100 years, the nominee receives the sum assured. However, if the life assured outlives the age of 100 years, the insurance company pays the matured endowment coverage to the life insured.
A whole life insurance policy covers as long as you live. As it offers risk coverage for the entire life, it is called whole life policy. It offers dual benefit of life coverage and bonus. The premium is paid for the first 10-15 years and the insurance cover is extended till the entire life of the insured.
How Does Whole Life Insurance Work?
Whole life plan is a unique life insurance plan. The main objective of a whole life insurance is to help the life assured live a worry-free life while being able to create a legacy for their heirs.
The whole life insurance policy provides death benefit along with maturity and survival benefit to the policyholder. Whole life insurance plans come in different variants. According to the one’s own requirement and suitability, the insured can choose from different types of whole life insurance offered by the insurance companies.
The reason being, it comes with not only death benefits, but also with maturity and survival benefits along with bonuses, if any. The life assured is covered until the death, and also has the maturity benefit feature.
There are different types of whole life insurance policy variants. The policyholder can opt for a traditional whole life plan or a unit linked plan. Traditional Whole Life plans are further categorized as participating and non-participating.
Benefits of Whole Life Insurance Plans
- Whole Life Coverage: Whole life insurance provides coverage to the policyholder until 100 years of age. The policy provides protection to the insured until death.
- Guaranteed Life Coverage: The whole life insurance assures the financial security of the family and the loved ones even in the absence of the breadwinner of the family.
- Periodic Payments: At the time of policy maturity, the policyholder receives the lump-sum amount as maturity benefit along with the bonuses, if any. Moreover, some of the whole life insurance plans also offers maturity benefit in form of regular income. Thus, at the time of maturity of the policy, the insured can choose the avail the maturity benefit as a lump-sum amount at one go or as regular income at specific intervals of time.
- Tax Benefits: The insured can avail tax exemption under section 80C on the premium paid towards whole life insurance policy. Moreover, the maturity claims are also tax exempted under section 10(10D) of ITA 1961.
Serves as a Source of Cash: According to the experts it is suggested that the individuals should save funds for future so that they can deal with the eventualities of life. However, creating a large corpus at a small span of time is not an easy task, with the help of whole life insurance plan one can secure their future financially and can achieve their long-term financial goals of life.
- Offers Loan Facility: As whole life insurance provides protcetion up to 100 years of age, the policyholder can opt for loan facility against the plan. However, loan can only be availed if the insured completes 3 policy years and if all the premiums of the policy are dully paid.
- Benefits the Dependents of the Plan: Whole life insurance policy is a great option of investment in order to provide financial security to the family. For example, if an individual opt a whole-life plan then both the spouse will get an extra financial coverage that can be used at the time of retirement as retirement fund. In case, of decease of one of the partner, the policy will provide death benefit to the beneficiary of the policy.