Life Insurance plans are designed to protect your family and dependents against the financial disasters in case of the death of the breadwinner of the house. Depending on the type of insurance plan you have enrolled in, the money is paid to you. There are several types of life insurances. If you chose a whole life insurance, the money will be paid to the beneficiary on your death. If you chose for term life insurance, the insurance plan will cover a specific amount of time only. Once the term is up and you die the next day after that you will not be benefitted from the plan.
Once you know about your need and decide the beneficiary, you can enroll in a life Insurance plan. To keep the insurance alive, you have to pay for the premiums before the due date every month. In case you fail to deposit the due amount, you will be given a grace period to pay out. Beyond the grace period, you cannot keep your insurance plan alive. You can always go back and change the policies based on your need. You can also add up feature on your insurance plans to take maximum benefit out of it.
Once the term is over for any insurance plan, you can claim your policy and get the amount promised from your insurance company. The claim process generally takes a while to complete based on the complexity of the claim and the amount of money involved. Death claims take longer time than the maturity related claim, which involves very simple and straightforward process to get your money back.
Key features of Life Insurance Plans
Key features of Life insurance plans are the building blocks of your peace of mind.
Premium Waiver: The Company will pay for your premium in case you are critically ill or become disabled with time. This condition is applicable only if you have continued paying for your premium over six months.
Accelerated death Benefits: This feature offers you to have cash advances if you diagnosed with terminal illnesses. It is a great opportunity for those who have a short amount of time to live and want to take help in form of money
Guaranteed purchased option: It offers you to purchase an insurance plan in the future without validating the condition of your health.
Long-term care riders: It is a life product included in the plan to cover long-term care for your life and at the same time, you exchange reduced benefit.
Spouse or child term riders: This offers you to purchase term life insurance for your spouse and child up to 26 years old.
Cash value plans: You can use the plan as a fund from which you can take a loan and borrow money during your lifetime.
Mortgage and plans: This feature includes an option to pay your mortgages if you die.
Cash withdrawal and loan: This feature offers you to have a benefit of taking a loan against the premiums paid and you can always withdraw cash against the premiums paid.
Loans through Life insurance plans in India
We save our money for the worst time when we are needy. Life Insurance is a form of savings, which you can use whenever you want. It offers you an option to take a loan against the premium you deposit for the insurance plan. It is definitely helpful in an emergency where you need money but not willing to ask any of your friends or do not want to pay much interests on loans.
Applying for a loan through life Insurance is a very simple process. You just have to visit the insurance company and ask for a loan. The insurer will give you an application form where you will declare that in case you cannot repay the amount of the loan, the insurer has the first right to take the amount from your insurance plan and will give the remaining amount to you after deducting the due. After you sign the form, you sign canceled the check and give it back to the insurance company.
Although the loan option is available, not every policy offers you to apply for a loan. You can apply for a loan only if you are enrolled in traditional non-linked endowment policies. The interest rate applicable on the loan varies from one insurance company to other. Generally, the interest rate on the loan amount is higher than the normal loans. Unless it is extremely necessary, one should not go for loan option against the llfe insurance.