When you have a family, it becomes your responsibility to protect and nurture them. It is also essential that you secure their future, even if you can no longer be a part of it.
You need the best financial strategies so that you and your family can reap the greatest long-term rewards. One such strategy, especially when you get a bonus, a gift in cash or surplus money, is a Single Premium Term Life Insurance Plan.
What is Single Premium Term Life Insurance?
Let's define term life insurance first before we get started with single-premium policies. Probably, the most simple and straightforward life insurance policy is the term life insurance, which covers the insured individual. When you choose term life insurance, your insurance company offers a set amount of money that will be paid to your beneficiary in the event of your death during the tenure of the policy. Typically, you can choose whether to pay the premium for this plan monthly, quarterly, or annually. However, a single premium term life insurance is a unique variation on standard term life insurance in which the entire premium is paid upfront.
Benefits of Single Premium Term Life Insurance
Let us take a look at the most striking benefits of a term plan with a single premium:
- You won't have to worry about reviewing and analysing the premium amount regularly once you pay the complete term life insurance premium in a single premium. This reduces the likelihood of a policy lapse as some consumers frequently overlook the due dates for their premium payments.
- Even if you are not there, a single premium term life insurance coverage improves and safeguards your family's finances.
- A single premium term life insurance secures your family and boosts them financially even in your absence. Once you have cleared the entire premium, your family just needs to file a claim, and the sum assured will be paid to the nominee.
- Single premium term life insurance allows multiple tax benefits. Under Section 80C of the Income Tax Act, you can save up to INR 1,50,000. The death benefit is also tax exempted under Section 10(10D).
List of Single Premium Term Life Insurance Plans in India
Take a look at the most popular Single Premium Term Life Insurance Plans in India:
LIC’s Single Premium Endowment Plan
One of the most valued and trusted brands across the insurance sector is the LIC. The single premium term insurance policy offered by LIC is wide and is the best investment strategy with just one premium payment for the entire policy period. It offers the following benefits:
- Maturity benefits include the sum assured value + reversionary bonus amount + final bonus if the policy's tenure is completed.
- A death benefit is paid to the appointed nominee in case the insured individual dies during the tenure of the plan.
- During the term plan surrender, the insurance company will pay 70% of your premium. If you surrender in the first year of the purchase, you will be paid 90% of your premium paid.
- After the first year of the plan's tenure, you can opt for a loan if needed.
ICICI Prudential iProtect Smart Term Policy
If you are a young working professional and have dependents after you, it is a suitable plan for you. You are completely covered in the case of terminal illness, and you get coverage for 34 illnesses, that also includes AIDS
- You can choose the death benefit payout interval as per your wish
- Your single premium amount and payout amount are both tax-exempt.
- You also have the option to buy the policy online along with the MWP, Married Women’s Property Act.1
Bajaj Allianz Life Smart Protect Goal
It is purely a term life insurance policy with a wide range of coverage through various variants. You can choose between:
- Life Cover
- Increasing Lofe Cover
- Child Education Extra Cover
- Life Cover with Joint Life
- As a maturity benefit payback option, you can select the return of premium benefit
- You can choose plans that cover you till the age of 99
- You can also opt for additional coverage that includes critical illness, or accidental disability (complete or partial).
HDFC Life Click 2 Invest ULIP
A popular unit-linked insurance plan, Click 2 Invest is built to offer you maximised investment benefits plus better maturity and death benefits. The insured receives maturity benefits when the tenure of the plan ends, which they can claim over a 5-year span in the form of settlement. The death benefit is 105% of the sum assured plus add-on bonuses.
- While you surrender the plan after 5 years of the plan, you are paid back the total fund value with no reductions.
- Once the 5-year lock-in is over, the plan allows you to withdraw the money partially when you need it.
A single premium term life insurance coverage is available to anyone. It is a good idea for you, though, if you are a businessperson or freelancer whose revenue/ income is not consistent or varies from month to month. By doing this, you can pay the premium once and receive the advantages over time without having to worry about paying premiums on a regular basis.