What is a Life Insurance Plan: Know its Importance

Life insurance, as many of you know it, is a simple transaction between the insurance provider and policyholder. They are of several types with a few differences and similarities which distinguishes one from another. What’s crucial is to understand their meaning, types, and benefits.

Do you know why you must know these things about life insurance? Well, knowing what is life insurance and its types helps you assess your eligibility for it. Moreover, it helps you become aware of what plan you’re investing in.

So, without further ado, let’s explore different life insurance plans and learn about them.

Understanding Life Insurance Meaning

Pure protection is the primary goal of life insurance. It is simply a financial tool that offers the beneficiaries a security net in case of the policyholder’s untimely demise. This protection is provided in the form of a sum assured.

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In addition, what is life insurance important for is long-term savings. Several insurance plans now offer investment opportunities, depending on the policy type. Understanding the meaning and significance of a life insurance plan is what translates to smart investments.

Finding Out Types of Life Insurance

Knowing what is life insurance is essential and its types more than that. While one offers purely death benefits, another plan offers market benefits. Likewise, there are different life insurance plans that you can explore. Here are some of them given below:

1. Whole Life Insurance Plans

Whole life insurance is one of the schemes offering a death benefit payout, building cash value over time, and tax benefits. Premiums are usually fixed, offering predictability in financial planning.

• Health Insurance Plans

What is life insurance for health? It covers medical expenses that may arise from any illness, surgery, or hospitalisation. It is essential for managing unforeseen health-related expenses and maintaining financial stability.

• Saving Plans

Knowing life insurance’s meaning isn’t enough to pursue saving plans. There are several life insurance products that are designed to save and build a financial corpus over time. Here, a combination of insurance protection is offered alongside savings benefits. They offer a lump sum payout at maturity, guaranteed returns, bonuses, and tax benefits.

• Child Insurance Plans

This is an insurance plan especially crafted to cater to parents or those who are going to become parents. It basically secures a child’s financial future, covering education, marriage, and other significant life events. In addition, there’s an insurance element, providing a lump sum payout at maturity or key milestones in the child’s life.

• Retirement and Pension Plans

One of life’s tricky phases that you must plan is your golden years, also known as the retirement years. Pension plans, here, enter as a steady income policy to ensure financial independence in later years. Along with that, certain plans may also include insurance coverage. This gives you peace of mind and security for yourself and your dependents.

• Term Life Insurance Plan

Term plans are basically coverage insurance schemes for a specified period. In simple words, it is what life insurance is all about. It offers a death benefit to beneficiaries if the policyholder passes away during the term. They are clear and affordable plans, making them an attractive option for temporary coverage.

• Unit Linked Insurance Plans (ULIP)

ULIP life insurance meaning is simply an investment opportunity offered alongside insurance protection. While one part of the premium goes to insurance, the other part is allocated to market investments. They’re suitable for you if you’re one of the risk-averse investors.

Get Insured with a Suitable Plan Today!

What is life insurance? This is one of the questions that has various answers, particularly because every one of you has unique goals and financial position. By understanding its different types and understanding them, you can easily make an informed decision. However, you may also require a reliable insurance company, like Canara HSBC Life Insurance, where you can buy these plans from. After all, it’s a matter of protecting your future.

You can go to their official website, which is user-friendly, and easily navigate the online life insurance plans section to explore their range. It includes iSelect Smart Term Plan, Young Term Plan, iSelect Guaranteed Future Plus, etc. Get insured today!