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Life is unpredictable and uncertain in nature, which is why you need to get the life cover for your family to ensure that your family is not left stranded after the mishap. Whole Life Insurance Plan is a Life Insurance Plan that typically covers the policyholder for his/her entire lifetime, provided the policy is in force. The premium amount throughout the policy tenure remains fixed.
The Whole life insurance plan is a combination of insurance and investment component. It is a basic life insurance policy covering you for any uncertainties throughout your life span.
Get QuotesFollowing are the top reasons to buy a whole life insurance.
No one knows what will happen tomorrow, but in order to ensure the financial independence of your family in your absence, it is quite essential to buy a whole life insurance to secure all important life events in your lifetime.
You have several financial obligations such as children’s education, marriage, loans, etc. In case of a mishap, a life insurance policy helps your family fulfill all these financial obligations with ease.
Any amount of money cannot be a substitute for a person. But, by buying a whole life insurance you can provide protection for your loved ones when you are not there.
In case you develop a critical illness or are disabled due to an accident, such incidents may result in loss of income and may lead to financial crunch. A life insurance policy can provide your family the financial assistance, when your earnings are disrupted.
By buying whole life plan, you can avail benefit to get the cover for the lifetime. If bought at an early stage, you need to pay the premium charges, so it is affordable to keep the policy active throughout the life span.
Typically, there are two types of whole life insurance plans.
Under this life insurance policy, the insurance company shares its profits with the policyholder. The actuaries of the company make the estimates of the investment returns and profits are then shared accordingly. The proportion of profits shared with the policyholder usually varies and it is announced annually by the insurance company. The accumulated bonus or returns are paid on death or maturity, whichever event occurs earlier.
Under this life insurance policy, the benefits are fixed and remains same throughout the entire policy period. Such policies do not participate in the profits of the insurance company. The benefits are paid as lump sum amount which remains constant throughout the policy period.
Following are the key factors that help determine the premium amount for the whole life insurance plan:
Your present age determines the premium amount for the life policy. If you are buying the plan at a younger age say at an age of 25 years, you are charged with lower premiums. If you are buying at a later age say at an age of 45 years, the insurer charges the higher premiums for providing the same life cover as the risk in life aggravated with the advancement of age.
The higher life cover attracts, the higher premium to cover the risk. Although, some insurers offer some attractive discounts on choosing the high life cover,proportionately you need to pay the higher premiums for a higher life cover.
Bad habits such as smoking cigarettes and consumption of alcohol have an adverse effect on the premium amount. As these are injurious to health, insurers will charge higher premiums to cover the risk.
Your present health condition also plays a key role in determining the premium amount for the whole life insurance policy. In case, you are suffering from illnesses such as blood pressure, diabetes, or other diseases, your insurer will charge the higher premiums. Your previous health conditions also make an impact on the premium amount. The history of any critical or potential health issues also needs you to pay the higher premiums.
As per statistical analysis, females tend to have higher life expectancy than males. Taking into consideration the mortality risk, insurers charge higher premiums to provide life cover for the male life based on life expectancy model.
The nature of occupation also determines the premium amount for your whole life policy. A risky occupation like working in the mining industry, coal mines, serving in the armed forces, etc. involves the risk of life. Insurers will charge you with the higher premiums basis high intensity of the risk involved in your occupation.
Following are the rider options to attach with your whole life policy:
This rider provides extra financial benefits to your nominee in case of your death due to an accident. Under this rider, an accidental death sum assured is paid to your nominee, which is additional to the base sum assured of the policy.
Under this rider, an additional death benefit is paid to your nominee additional to the base policy sum assured in case of any form of death. The assigned nominee can then receive the sum assured as specified under this rider.
This rider takes care of the medical costs involved due to severe illnesses such as a Major organ transplant, Coronary artery bypass, Heart attack, Cancer which may disable an individual temporarily or permanently that result in loss of earnings.
Under this rider, the future premiums for the whole life plan is waived off in the case of death or disability of the policy holder. The policy remains active till the end of the policy period.
In a whole life insurance, the policy benefits are provided to the nominee as a one-time lump sum amount, but by choosing this rider, the nominee can exercise the option to receive benefits in installments as a guaranteed income. It helps them take care of day to day expenses in the absence of the insured.
This rider replaces your income for the specified tenure in case of permanent or temporary total or partial disability arising due to an accident or sickness. The payout may differ depending on the type of disability occurred.
Get QuotesYour whole life insurance plan has the following exclusions.
This clause states that if the insured commits suicide within the first year of the commencement of the policy, the insurer is not liable to pay the policy proceeds.
This exclusion states that if the life insured dies as a passenger in a private plane, the insurer will not entertain the claim. The policy benefits are paid out only in when the life insured is died in a commercial plane crash while travelling.
This exclusion says that if the death of the insured occurs due to the involvement in dangerous adventure activities such as river rafting, para-gliding, skiing, rock climbing, etc, policy benefits will not be paid.
This exclusion provides that the insurer will not pay, if the death is occurred as a result of the war.
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