We are empaneled with following Life Insurance Companies
- ICICI Prudential Life Insurance Co. Ltd.
- Kotak Mahindra Life Insurance Company Limited
- HDFC Life Insurance Company Ltd
Life insurance is a contract between an insured individual and the insurer, whereby the ‘life assured’ (insured) pays a premium at regular intervals for a pre-decided tenure (term). In case of the untimely demise of the life assured, his nominee/s will receive the ‘sum assured’ from the insurer. Not only does this lend the important financial support during an untimely demise of a family member, it also proves to be a great helping hand in case of an accident or a calamity. This is the broad perspective; in reality life insurance is much more than that.
Life insurance in fact is a great investment option. One can opt for a scheme for a fixed period of time. At its expiry you not only gain the principal amount but also a maturity amount. Therefore it can be used with a similar intention to that of a fixed deposit, only with the promise of higher returns and bonuses as well as protection.
Life insurance also has a number of laws supporting it in terms of tax benefits like that of Section 80C, which makes an investment made upto Rs. 1.50 lac per annum a qualified tax deduction and 10(10D) which ensures that the proceeds received from insurance companies are tax free in the hands of the investor. The only exception is Pension Plans which do not qualify under Section 10(10D).
According to the benefits they yield, the different life insurance policies are classified as follows:
- Pure Term Plan: This is pure insurance protection where a pre-determined sum of money is paid to the beneficiary incase the death of the insured individual occurs during the policy period. However, if the insured individual outlives the tenure of the policy, the function of the policy is concluded and the premiums are not returned to the insured person. This type of insurance, apart from providing protection, has the huge advantage of being devoid of any taxation at the time of a claim. Therefore the premiums designated are at the lowest possible rate, as they are designated purely for the coverage of risk.
- Term Return of Premium: This is another variation of a Pure Term Plan, with a few iterations. In this, if the insured individual outlives the policy term, he becomes eligible to get back the entire premium amount that he has paid over the years.
- Unit Linked Insurance Plan: A Unit Linked Insurance Plan (ULIP) is a product offered by insurance companies that, unlike a pure insurance policy, gives investors the benefits of both insurance and investment under a single integrated plan. These types of plans are market-linked and hence ride the ups and downs of the capital market. ULIP plans offer more flexibility compared to a plain vanilla mutual fund; the most useful one being, the flexibility to switch between the different fund options within the same plan, without incurring a charge. They also offer top-ups in existing funds, switching subsequent investable premium payments into different funds within the same plan, increasing and decreasing the sum assured and the option of including riders to offer increased protection. All ULIPs (except Pension Plans) qualify for tax deductions under Sections 80C and 10 (10D).
Which Investor Class Are They Most Suited for ULIPs?
Those who wish to closely track their investments: Unit linked plans allow policyholders to closely monitor their portfolios. They also offer the flexibility to switch invested capital between funds with varying risk-return profiles.
Individuals with a medium to long term investment horizon: ULIPs are ideal for individuals who are ready to stay invested and protected against the risk of death for relatively long periods of time, since some Unit Linked Insurance Plans are available till the age of 100.
Those with varying risk profiles: Most insurance companies offer the choice of 7-10 different fund options with the equity and debt component varying from 0 to 100%. Thus, there is a choice of funds available to all types of investors – from risk-averse investor to those investors who have strong risk appetite.
Investors across all life stages: ULIPs offer a variety of plans which can be opted for by clients, depending upon the life stage they are in and their needs and financial liabilities at that point in time. For example, ULIPs can be taken for asset creation / children’s education and marriage or even for a comfortable retirement period.
- Endowment/Traditional Plans
An Endowment Policy is an interesting combination between insurance and investment. In case of endowment plans, the term of the policy is defined for a specified period, say 10, 15, 20, 25, 30 or more years. The insurance coverage of the individual is fixed at a certain amount, which is known as the ‘Sum Assured’. In the case of the unfortunate death of the policy holder during the policy period, his beneficiary receives the ‘Sum Assured’. However, if the individual outlives the maturity period of the policy, he gets back all the premiums paid along with other investment returns and bonuses. This form of investment/insurance is very popular for savings with respect to education, marriage and retirement since a lot of endowment plans offer gauranteed returns at maurity along with additions as loyalty bonuses.
- Money Back Traditional Plans
This type of endowment plan is extremely popular with conservative clients who, in addition to protection are looking at guaranteed and periodic returns. A Money Back policy is mostly issued for a specified period, and the sum assured is paid through periodic payments to the insurance company, spread over the pre-defined policy term. In case of the death of the insured within the term of the policy, full sum assured along with bonus accruing on it is payable by the insurance company to the nominee.
The team at Plutus has had extensive training in the various life and non-life insurance products and is available to help you make an informed decision for whatever the reason you may have - whether it is the protection of a loved one or self, or the education or marriage of children or a confident retirement.
We are empaneled with following Health and General Insurance Companies
- Aditya Birla Health Insurance
- Care Health Insurance
- Star Health & Allied Insurance Co Ltd
- ICICI Lombard General Insurance Company Limited
A Non-Life Insurance policy is defined as a policy that will cover all perils except death, subject to certain conditions. This is an important policy for dangers other than a threat to life exist – for instance, a financial loss or health impairment. Therefore general insurance companies have come up with different policies that provide protection from perils that come up in daily life. Some of the most commonly required protection plans are:
- Health Insurance: This type of insurance offers cover against ever-rising medical care costs and expenses, beginning from diseases to grave accidental injuries. Health insurance is a critical monetary product that is a must for every individual irrespective of his or her age. It offers complete monetary peace of mind and pays for the treatment of almost any ailment or treatment (with certain exceptions). Most health insurances offer cashless settlement of claims at hospitals. The Income Tax Act takes this into account and offers qualified rebate under Section 80D up to a maximum of Rs. 15,000 per person each financial year.
- Motor Insurance: As a matter of law, no motor vehicle is allowed to be driven on the road without a valid motor insurance. This makes this kind of insurance mandatory to own. Motor Insurance policies cover against any loss or damage caused to the vehicle due to any calamity. In addition to this, a motor third-party insurance or third-party liability cover, which is sometimes also referred to as the 'act only' cover, is a statutory requirement under the Motor Vehicles Act. It is referred to as a 'third-party' cover since the beneficiary of the policy is someone other than the two parties involved in the contract that is, the insured and the insurance company. The policy does not provide any benefit to the insured; however it covers the insured's legal liability for death/disability of third party loss or damage to third party property.
- Householder’s Insurance Policy: Any loss or damage to the house or household goods would cause not only financial strain but also an emotional setback. Household insurance helps individuals and families to mitigate, at least the financial losses, arising out of risks like fire, flooding and other natural disasters, burglary and breakdown of household appliances among other perils.
The team at Plutus has had extensive training in the various life and non-life insurance products and is available to help you make an informed decision for whatever the reason you may have - whether it is the protection of a loved one or self, or the education or marriage of children or a confident retirement.
