Types of Life Insurance?

There are several types of life insurance, each suited to different needs. Let's explore the most common types:

1. Term Life Insurance

Term life insurance provides coverage for a specified period—usually between 10, 20 ,30 and 40. If you pass away during this term, your beneficiaries will receive the death benefit. Term life is typically more affordable than permanent policies, making it a good choice for those who need coverage for a certain period (e.g., income replacmenet, while raising children or paying off a mortgage and etc).

2. Whole Life Insurance

Whole life insurance provides coverage for the policyholder's entire life, as long as premiums are paid. This policy also has a cash value component that grows over time, offering a combination of protection and investment.

3. Endowment Policy

An endowment policy provides a combination of life insurance and savings. It not only covers the policyholder for a set period but also provides a lump sum amount if the policyholder survives the policy term.

4. Money-Back Policy

In a money-back policy, the policyholder receives periodic payouts during the policy term. These payments are made at specified intervals (usually every 5 years), and the sum is paid back to the policyholder in parts during the policy term. The remaining sum is paid to the nominee upon the policyholder's death.

5. Unit Linked Insurance Plans (ULIPs)

ULIPs combine life insurance with investment. A portion of the premium is used for life cover, while the remaining amount is invested in different market-linked instruments such as equity, debt, or hybrid funds.