Can You Avail Regular Income with Life Insurance Plans?
Can You Avail Regular Income with Life Insurance Plans?
6/27/23 5:20 AM
Monthly Income Investment Plans are a type of life insurance plans that give families the dual advantage of regular monthly income payouts and a fixed death benefit. These plans help the family manage the life cover payout better. In a life insurance plan, a fixed lump sum is paid on the demise of the policyholder or the life assured. However, managing this huge chunk of money can become a mammoth task for the grieving family.
The best investment plan for monthly income helps the policyholder by paying regular income during the policy term and help supplement the primary income. Additionally, upon the demise of the life assured, they offer a lump sum payout plus a stream of regular income to the nominee to ensure better management of day-to-day financial needs.
What are the features of a Monthly Income Plan?
A guaranteed monthly income plan gives you:
· Regular income payouts through the entire term of the monthly income plan:
In a monthly income plan, the policyholder starts to receive regular income payouts as early as the beginning of the second year of the plan’s term that continues for the entire plan duration.
· A fixed level guaranteed income or an increasing guaranteed income:
The family can choose to receive the regular income payouts in the same percentage throughout or an increasing percentage. This percentage is a portion of the sum assured amount as it would be on the maturity of the monthly income plan.
· A guaranteed maturity benefit in case you survive the term of the monthly income plan:
Unlike term insurance or other life insurance plans, a monthly income plan does not let your investment go to waste if you survive the term. It ensures you receive the sum assured on the expiry of the plan in case of your survival.
· Life insurance protection through a guaranteed death benefit:
On the demise of the life assured, a monthly income plan gives his/her family members a fixed and guaranteed portion of the sum assured. The family has the choice to receive the rest as regular income payouts.
· An added layer of protection with extra riders (covers) for unforeseen situations:
The best monthly income plan is one that comes with extra riders for an enhanced level of protection to your loved ones in unforeseen scenarios.
Here are some of the riders offered with Edelweiss Tokio guaranteed income plans, such as the Active Income Plan:
o The Accidental Death Benefit Rider:
This rider gives an extra sum over and above the base sum assured in case the policyholder dies due to an accident.
o The Accidental Total and Permanent Disability Rider:
This rider gives an extra sum over and above the base sum assured in case the policyholder develops a permanent physical injury due to an accident.
o The Critical Illness Rider:
This rider gives an extra sum over and above the base sum assured in case the policyholder develops a critical illness.
o The Waiver of Premium Rider:
This rider waives off the payment of future premiums in case the policyholder passes due to an accident, develops a critical illness or a permanent injury due to an accident.
o The Income Benefit rider:
This rider gives extra sum amounts in the form of monthly income payouts in addition to the base sum assured.
What are the benefits of a Fixed Monthly Income Plan?
1. Monthly Income Plans carry zero risks.
By keeping your savings intact and growing it at the same time, monthly income plans work as a second source of income for you and your loved ones both in your presence and absence. They are completely free from market-related risks and fluctuations, thus keeping your income secure against loss.
2. Monthly Income Plans help you strategize funds.
The best feature of monthly income plans is the twin benefits of a lump-sum and regular income it provides. The lump-sum is useful for re-investing your money in different avenues - and the stream of fixed income helps your family spend funds with care and as per their needs, reducing the chance of overspending and running out.
Moreover, as you receive the income right from the second or third year of the term, you can use the income to fulfil various life milestones such as higher education, your/your spouse’s retirement, and your parents’ healthcare expenses, a much-awaited foreign trip and so on.
The Edelweiss Tokio Life Active Income Plan has plenty of benefits to offer, such as:
· The choice to receive regular income from the start of the second policy year or the completion of the first premium paying year
· Whole life insurance protection - given up to 99 years of age
· A family income benefit that waives off the payment of future premiums in the case of your demise or diagnosis with a critical illness. This is in addition to giving the maturity benefit and regular income payouts to family members.
· Six additional riders to choose from, as mentioned above:
o Accidental Death Benefit Rider
o Accidental Total and Permanent Disability Rider
o Critical Illness Rider
o Income Benefit Rider
o Waiver of Premium Rider
o Payor Waiver Benefit Rider
· The facility to take a loan against your monthly income plan in case of an emergency
· Non-guaranteed cash bonuses added to your income
· Tax benefits on the premiums paid in a year and the maturity benefit received under the relevant sections of the Income Tax Act, 1961.
To sum it up:
The Monthly Income Investment Plan is the perfect solution for those who want to secure their families in their presence and absence both. It provides financial support in the steady and unpredictable stages of life and serves as an aid both in good and bad times, thus helping you live a worry-free life at all times. The regular income during the policy term helps you manage your finances better, while the regular income payout to the family after your demise helps them streamline their daily needs optimally. All in all, monthly income plans with life cover are the perfect choice for a secured financial life for you and your family.
Neha Panchal - Financial Content Writer
Neha used to be an Engineer by Profession and Writer by passion, which is until she started pursuing full-time writing. She's presently working as a Financial Content Writer, with a keen interest in all things related to the Insurance Sector.