Term Plans And Fluctuating Insurance Rates-magicq

Loans The Reserve Bank of India is expected to cut the repo rate by 25 basis points in April 2016, after the release of the annual budget, according to a report by the Japanese brokerage firm, Nomura. This rate cut is expected to be fuelled by the growth figures for 2015-16, which has marginally undershot the RBIs projection of 7.4 percent, said The Economic Times in February 2016. This piece of news might interest you if you have parked your money in market related investment products. Such rates cuts not only affect mutual fund investments but also life insurance products. However, term insurance rates remain stable even during interest rate fluctuations. How Does a Term Plan Score Over Other Policies? We are well aware of how interest rate fluctuations directly affect loans and lending rates. However, they also affect the investment and asset markets and other .modities related to the financial markets. There are five types of life insurance products sold in India, such as term plans, ULIPs, endowment, whole life and money back plans. Of these five, only term insurance is a pure vanilla product, while the rest all are part investment products. Being a pure product, it offers one of the highest cover at the cheapest cost. On the other hand premiums for market related products shoot up primarily because of two reasons: firstly, only a part of the premium goes towards savings, while the rest goes towards investment. Secondly, being market-linked, they are high risk products. Moreover, maturity proceeds from investment-cum-insurance products are to an extent dependent on returns on investments. One may argue that a term plan is not a smart investment choice because it only offers death benefits. However, in reality, it is one of the most .prehensive products when it .es to securing your familys financial future. Unlike other products, term insurance rates do not fluctuate with interest rates fluctuations, which make it a stable and safe investment choice. Moreover, the sole purpose of a life insurance policy is to cover your life and provide financial security to your family after your death and not wealth creation or tax saving. And a term plan does the job well. Premium payments towards a term policy are merely a fraction of what you would pay for other plan for the same cover amount. This gives you the opportunity to buy a sufficient cover to fulfil your familys financial needs at a low cost. Term insurance rates are determined by factors such as cover amount, health of the policy holder, tenure of plan and so on. You can contact an agent or look up a .panys website to know more. About the Author: 相关的主题文章: