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Investment Plan
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Take a step ahead to secure your goals
What are Investment Plans?
An investment plan is an insurance plan that helps you in saving wealth for the future. The premium payments are used to build a savings corpus, and to provide life cover
to you and your family. People choose investment plan because it provides an opportunity to grow their wealth to fulfil their future goals.
Investment Plans provide the opportunity to create short-term and long-term wealth for the future. They help you meet your financial goals like child’s education, buying
a house, car, or even your dream vacation by accumulation of wealth over a period. Investment plans help you save in a systematic manner, protect your loved ones, and
save on taxes.
For example, a guaranteed income plan can help you in building the engines of income for tomorrow with life cover and tax benefits. Another great example of an
investment plan can be a Unit Linked Insurance Plan (ULIP) that combines the benefits of investments and life cover under a single plan. Premiums paid are invested in
market-linked investment instruments, as well as to provide life cover to you. Though ULIPs are moderate-to-high-risk plans, they are mainly chosen for their potential to
generate higher returns.
Investment plans also act as a great means to plan your retirement and to invest in your child’s future.
Detailed Guide on How Investment Plans Work
Guaranteed¹ Return Plans
You pay a premium towards securing a Guaranteed¹ Income. The premium can be paid as a single, lumpsum pay, for a limited period, or for the entire policy tenure.
The premium is used by the insurance company to offer life cover and investment in a no-risk, non-market-linked avenue for guaranteed1 growth of wealth.
The life cover continues for the entire policy term. If you face any uneventful situation during this term, the sum assured is the death benefit that the authorised beneficiary from your family will receive.
The plans offer tax benefits3 on premiums paid towards this plan are eligible for deductions under section 80(C) and the income under section 10(10D).
You pay a premium towards securing a Guaranteed¹ Income. The premium can be paid as a single, lumpsum pay, for a limited period, or for the entire policy tenure.
The premium is used by the insurance company to offer life cover and investment in a no-risk, non-market-linked avenue for guaranteed1 growth of wealth.
The life cover continues for the entire policy term. If you face any uneventful situation during this term, the sum assured is the death benefit that the authorised beneficiary from your family will receive.
The plans offer tax benefits3 on premiums paid towards this plan are eligible for deductions under section 80(C) and the income under section 10(10D).
Unit Linked Insurance Plans
You pay a premium towards the ULIPs. The premium payment modes could be Single Pay, Limited Pay, or Regular Pay.
The insurance company pools money from the policyholders and invests the same in market-linked investment avenues, based on the funds chosen by the policyholder.
You get to choose the type of funds you wish to invest in based on your risk appetite. Equity funds are for high-risk investors, debt funds for low-risk and hybrid funds for medium-risk investors.
Life cover is available for the entire policy term and is the sum assured that the authorised beneficiary receives on your demise.
The insurance company also offers certain fund additions, such as Loyalty Additions, Booster Additions and Maturity Additions throughout the policy term2.
The invested money grows, basis market forces and the accumulated amount is paid to you (the policyholder) on maturity.
You pay a premium towards the ULIPs. The premium payment modes could be Single Pay, Limited Pay, or Regular Pay.
The insurance company pools money from the policyholders and invests the same in market-linked investment avenues, based on the funds chosen by the policyholder.
You get to choose the type of funds you wish to invest in based on your risk appetite. Equity funds are for high-risk investors, debt funds for low-risk and hybrid funds for medium-risk investors.
Life cover is available for the entire policy term and is the sum assured that the authorised beneficiary receives on your demise.
The insurance company also offers certain fund additions, such as Loyalty Additions, Booster Additions and Maturity Additions throughout the policy term2.
The invested money grows, basis market forces and the accumulated amount is paid to you (the policyholder) on maturity.
Saving for Future Goals
When it comes to fulfilling both long term and short-term future goals, such as buying a new car or home, children’s education, retirement planning etc., savings are a must. Without an investment plan in place, it is difficult to balance short term needs and future goals. Investment plans like ULIPs and Guaranteed Income Plans help you save systematically and help you plan for these future goals.
Family’s Protection
Investment plans are life insurance plans that offers a life cover to you (the policyholder). In case of an unfortunate death, your dependent family will still be financially secured.
Good Returns
Investment plans like guaranteed returns plan or ULIPs gives you the advantage of guaranteed returns and/or switching between funds depending upon their performance. Market-Linked plans help you to get maximized return on your investment based on your life goals. Guaranteed Income Plans, on the other hand, offer security of guaranteed returns and life cover.
Flexibility
A guaranteed returns plan offers you the flexibility to select a plan option basis your life goals – Lump sum, Short Term Income, Long Term Income & Retirement Income. On the other hand, an investment plan like ULIP lets you choose the premium amount, as per your requirements. They also give you the option of selecting funds from a diverse list of options as per your needs. Many ULIPs also offer the possibility of increasing your premiums during your premium paying term. One can opt for a particular plan based on their financial goals and risk appetite.
Liquidity
No matter what your premium paying term or policy term is, after the lock-in period of 5 years with an investment plan such as ULIP, you can fully or partially withdraw funds2 from your account when you need urgent funds.
Systematic Savings
ULIPs and Guaranteed Income Plans give you the benefit of putting aside a chunk of your income and save it for future use in a systematic manner. You can start with as low as Rs 1000 per month.
Wealth Accumulation
Investment Plans not only let you save for your future, but also help in growing wealth by allocating it to diverse funds – equity, debt, balanced or GILT.
Tax Benefit3 under Section 80C
Premiums paid for Investment Plans help you save taxes up to Rs. 64,116^^ every year u/s 80C. The maturity amount received is also covered under tax benefits3 u/s 10(10D) of the Income Tax Act, 1961.
Saving for Future Goals
When it comes to fulfilling both long term and short-term future goals, such as buying a new car or home, children’s education, retirement planning etc., savings are a must. Without an investment plan in place, it is difficult to balance short term needs and future goals. Investment plans like ULIPs and Guaranteed Income Plans help you save systematically and help you plan for these future goals.
Family’s Protection
Investment plans are life insurance plans that offers a life cover to you (the policyholder). In case of an unfortunate death, your dependent family will still be financially secured.
Good Returns
Investment plans like guaranteed returns plan or ULIPs gives you the advantage of guaranteed returns and/or switching between funds depending upon their performance. Market-Linked plans help you to get maximized return on your investment based on your life goals. Guaranteed Income Plans, on the other hand, offer security of guaranteed returns and life cover.
Flexibility
A guaranteed returns plan offers you the flexibility to select a plan option basis your life goals – Lump sum, Short Term Income, Long Term Income & Retirement Income. On the other hand, an investment plan like ULIP lets you choose the premium amount, as per your requirements. They also give you the option of selecting funds from a diverse list of options as per your needs. Many ULIPs also offer the possibility of increasing your premiums during your premium paying term. One can opt for a particular plan based on their financial goals and risk appetite.
Liquidity
No matter what your premium paying term or policy term is, after the lock-in period of 5 years with an investment plan such as ULIP, you can fully or partially withdraw funds2 from your account when you need urgent funds.
Systematic Savings
ULIPs and Guaranteed Income Plans give you the benefit of putting aside a chunk of your income and save it for future use in a systematic manner. You can start with as low as Rs 1000 per month.
Wealth Accumulation
Investment Plans not only let you save for your future, but also help in growing wealth by allocating it to diverse funds – equity, debt, balanced or GILT.
Tax Benefit3 under Section 80C
Premiums paid for Investment Plans help you save taxes up to Rs. 64,116^^ every year u/s 80C. The maturity amount received is also covered under tax benefits3 u/s 10(10D) of the Income Tax Act, 1961.
Fulfil Life Goals with Investment Plans
Whether you wish to send your child abroad for higher education or go on a European holiday in the next 5 years, all your financial goals require you to invest in advance.
Your income is limited, while your needs are many. Apart from your basic and immediate needs, which you may spend a considerable amount of your income on, you
have long term needs that need planning in advance.
It is recommended that before using up your income for monthly consumption, you save for future expenditure first. This often poses a problem, as your immediate
needs may seem never-ending. That’s why you need to think of wealth building rather than just savings. Investment plans help you utilize your savings and grow them
over time for future needs and goals.
Less Risk
A guaranteed¹ returns plan is a risk-free investment, as the returns received are guaranteed. On survival up to maturity date, you will receive guaranteed income. However, in market-linked plans, income is basis the market performance.
Tax Benefits³
Along with safety and security, choosing a guaranteed1 returns plan also lets you avail tax benefits3. While planning for your taxes, it is advisable to choose instruments that serve two purposes: tax saving up to Rs. 64,116^^ with premiums u/s 80C and returns that do not involve tax3 deductions u/s 10(10D).
Flexible Premiums
A guaranteed1 returns plan provides the flexibility to choose from four plan options: a. Lump Sum b. Short-Term Income c. Long-Term Income d. Retirement Income, basis your life goals.
Flexible Time Period
In your portfolio, a guaranteed¹ returns plan takes the place that you want it to take. It allows you to choose your own maturity period; you can choose for how long you want to pay the premium and maturity period. You can choose between a long-term or a short-term savings plan. This allows for every individual buy a plan which is most convenient to him and falls within his financial goals.
Less Risk
A guaranteed¹ returns plan is a risk-free investment, as the returns received are guaranteed. On survival up to maturity date, you will receive guaranteed income. However, in market-linked plans, income is basis the market performance.
Tax Benefits³
Along with safety and security, choosing a guaranteed1 returns plan also lets you avail tax benefits3. While planning for your taxes, it is advisable to choose instruments that serve two purposes: tax saving up to Rs. 64,116^^ with premiums u/s 80C and returns that do not involve tax3 deductions u/s 10(10D).
Flexible Premiums
A guaranteed1 returns plan provides the flexibility to choose from four plan options: a. Lump Sum b. Short-Term Income c. Long-Term Income d. Retirement Income, basis your life goals.
Flexible Time Period
In your portfolio, a guaranteed¹ returns plan takes the place that you want it to take. It allows you to choose your own maturity period; you can choose for how long you want to pay the premium and maturity period. You can choose between a long-term or a short-term savings plan. This allows for every individual buy a plan which is most convenient to him and falls within his financial goals.
Unit Linked Insurance Plan (ULIP)
A Unit Linked Insurance Plan (ULIP) is a life insurance plan with an additional feature of investing your money in the market for future financial goals. It also provides tax benefits3 as the premium paid helps you save taxes up to Rs. 64,116^^ u/s 80C. The amount received on maturity is also covered under tax benefits3 u/s 10(10D) of the Income Tax Act, 1961.
Why Should You Buy a ULIP Plan?
Market-linked returns
ULIPs offer you an opportunity to invest in market-linked investment avenues for wealth accumulation.
Dual benefit of life cover and investments
You enjoy the benefits of growing your wealth through market investments, while assuring a secured financial future for your family with life insurance cover.
Choice between long-term and short-term investment plans
With a lock-in period of just 5 years, ULIPs offer you the ability to opt for a short-term investment plan for short-term financial goals. Or you can choose to stay invested for the long-term by choosing a longer policy tenure.
Liquidity
ULIPs allow for partial withdrawals2 from the fund after the lock-in period, making ULIPs a highly liquid financial instrument.
Suitable for all risk-appetites
ULIPs offer a choice of funds for investment – equity funds for high-risk investors, debt funds for low-risk investors, and hybrid or balanced funds for mid-risk investors. Thus, no matter your risk-taking capabilities, you can choose a ULIP investment that suits your specific needs.
Market-linked returns
ULIPs offer you an opportunity to invest in market-linked investment avenues for wealth accumulation.
Dual benefit of life cover and investments
You enjoy the benefits of growing your wealth through market investments, while assuring a secured financial future for your family with life insurance cover.
Choice between long-term and short-term investment plans
With a lock-in period of just 5 years, ULIPs offer you the ability to opt for a short-term investment plan for short-term financial goals. Or you can choose to stay invested for the long-term by choosing a longer policy tenure.
Liquidity
ULIPs allow for partial withdrawals2 from the fund after the lock-in period, making ULIPs a highly liquid financial instrument.
Suitable for all risk-appetites
ULIPs offer a choice of funds for investment – equity funds for high-risk investors, debt funds for low-risk investors, and hybrid or balanced funds for mid-risk investors. Thus, no matter your risk-taking capabilities, you can choose a ULIP investment that suits your specific needs.
Endowment Plans
An endowment plan is a type of life insurance policy, which gives you the dual benefit of a life cover and future savings. It enables systematic savings and over a period
that would help you in getting a lump sum amount on surviving the policy term.
An endowment policy most often gives you guaranteed1 returns and hence is good for those who do not wish to take higher investment risks. You will get sum assured on
a fixed date in future as per the policy terms and conditions. However, in case of your (the policyholder’s) sudden death, the insurance company will pay the sum assured
(plus the bonus4, if any) to the nominee of the policy. Besides, it is also useful to secure yourself or your family post-retirement or to meet various financial needs such as
funding for children's education and/or marriage or buying a house.
Why Should You Buy an Endowment Policy?
Guaranteed Returns
Endowment policies offer low returns available with low risk. It offers the dual benefit of death cover and savings feature. These policies offer upfront guaranteed1 returns, and they are not linked to the market’s performance. The guaranteed1 returns such as guaranteed1 additions remain fixed and are payable on death or maturity (as applicable).
Bonus
The insurance company usually declares bonuses4, depending on how the investments have performed. When an insurance company makes profits from its investments, it distributes a part of funds to you (the policyholder) at the end of each financial year. The profits or surplus of a life insurance company is determined after the valuation of its assets and liabilities. Under an endowment policy, Simple Reversionary Bonus and Terminal Bonus are added to the sum assured and payable on death or maturity under the policy. Simple Reversionary Bonus is declared annually and accrued to be payable on death or maturity claim. Terminal Bonus a type of loyalty bonus and is paid only at the time of maturity of the policy.
Long-term Financial Planning
An endowment policy yields better returns when you maintain it for a long term. When you buy an insurance endowment plan, the benefits are payable, only in case of death or maturity claim. Surrendering the policy is not advisable, as it provides you meagre returns. You are required to choose a policy term that helps you to achieve savings and fulfil your financial objectives.
Premiums Benefits
With endowment policies, you can avail life cover or maturity benefit as the sum assured or guaranteed1 returns, as applicable under the policy chosen. This policy ensures financial cover for your family plus builds a corpus till the maturity of the policy.
Guaranteed Returns
Endowment policies offer low returns available with low risk. It offers the dual benefit of death cover and savings feature. These policies offer upfront guaranteed1 returns, and they are not linked to the market’s performance. The guaranteed1 returns such as guaranteed1 additions remain fixed and are payable on death or maturity (as applicable).
Bonus
The insurance company usually declares bonuses4, depending on how the investments have performed. When an insurance company makes profits from its investments, it distributes a part of funds to you (the policyholder) at the end of each financial year. The profits or surplus of a life insurance company is determined after the valuation of its assets and liabilities. Under an endowment policy, Simple Reversionary Bonus and Terminal Bonus are added to the sum assured and payable on death or maturity under the policy. Simple Reversionary Bonus is declared annually and accrued to be payable on death or maturity claim. Terminal Bonus a type of loyalty bonus and is paid only at the time of maturity of the policy.
Long-term Financial Planning
An endowment policy yields better returns when you maintain it for a long term. When you buy an insurance endowment plan, the benefits are payable, only in case of death or maturity claim. Surrendering the policy is not advisable, as it provides you meagre returns. You are required to choose a policy term that helps you to achieve savings and fulfil your financial objectives.
Premiums Benefits
With endowment policies, you can avail life cover or maturity benefit as the sum assured or guaranteed1 returns, as applicable under the policy chosen. This policy ensures financial cover for your family plus builds a corpus till the maturity of the policy.
When Should You Buy Investment Plans?
Though there is no perfect time to invest in an investment plan, it is recommended that you start at an early age. When you begin earning, it is wise to put money in an investment plan. It enables you to save money for your goals over a long period of time and in turn, help you increase your financial corpus.
Below are the following ways in which buying an investment plan early can help you.
1. Power of compounding :
“Compound interest is the 8th wonder of the world. He who understands it, earns it; he who doesn’t, pays it.”
Albert Einstein
What he meant was that if you invest smartly for the long term, you will reap the benefits of compounding. Compounding simply means investing your money in order to grow it further. Your wealth accumulation depends upon how long you stay invested.
Here is how you can calculate compounding:
2. Risk Appetite
The younger you are, the fewer responsibilities or liabilities you have. Historically, it has been shown that equities perform better than other assets even though they do
come with a fair bit of risk. Investors can switch from one fund option to another as per the market movements and outlook. Most ULIPs let you make unlimited switches
\between funds.
3. Patience and Discipline Pays
If you simply save your money in a bank, the tendency to withdraw the money is higher, and this does not lead to any growth. But if you remain patient and invest your
money, systematically for a long time, it will give you good returns.
Getting into the habit of saving systematically early on helps in easing the stress of financial liabilities when you become older. Being able to start saving early for your
future goals gives a very big financial advantage to young professionals these days.
4. Fight Inflation
A financial instrument like ULIP offers you flexibility to invest in a portfolio of stocks, which minimizes risks. You can also choose the funds you want to invest in as per your
risk appetite. Regular investments over a long period enable you to give time to your money in market, helping you build a larger corpus to achieve your life goals and
stabilize your funds against market inflation.
Who Should buy Investment Plans?
Every individual, young or old, married, or unmarried, must save for a rainy day. Having a corpus to fall back upon assures a stress-free life and helps you plan your finances efficiently. There are multiple investment options in India to choose from. While the choice depends completely on your financial goals, investment plans offer a range that suits everyone.
Following people should buy an Investment Plan:
- Those who wish to build a corpus of fund for future use
- Wish to grow money and secure family’s future
- To have an assured and regular stream of income to supplement primary income
- Wish to bring discipline in savings effort
- To enjoy the dual benefits of protection and wealth accumulation/savings in a single plan
Advantages and Disadvantages of Investment Plans
Advantages
- Assured financial security for the family’s future
- Growth of money to fulfil long-term financial goals
- Attractive market-linked returns with ULIPs
- Guaranteed1 payouts with Savings Plans
- Enjoy the power of compounding
- Instil the discipline of regular savings and investment
- Effective protection against inflation
- Tax benefits3 in accordance with current regulations
Disadvantages
- The premiums for life insurance plans with returns are slightly higher than those for pure term plans. However, the premiums are cost-efficient as you get the benefit of wealth generation along with life cover with these plans.
- People just starting with life insurance might find savings and investment plans complex to understand. The different plans, the investment components, multiple fund options, varied payouts and bonuses4, etc. can get confusing for a new buyer. However, Edelweiss Tokio Life Insurance offers detailed policy information through policy brochures. Additionally, you can get in touch with our customer executives to understand any policy in depth.
Reasons to buy Edelweiss Tokio Life Insurance Investment Plans
Edelweiss Tokio Life Insurance Company Limited was established in 2011 and has, ever since, developed a wide range of insurance solutions for education, impaired health,
wealth accumulation, wealth enhancement, income substitution, and retirement funding.
For a joint venture between Edelweiss, a leading Indian financial services company, and Tokio Marine, a Japanese life insurance company, Edelweiss Tokio Life Insurance is
the ideal choice for the following reasons:
Asia's Best Insurance Company
Asia's Best Insurance Company Award for CSR Activity & Digital Sales Channel^¹
Life Insurance Company of the Year
BFSI Excellence - Life Insurance Company of the Year 2021^²
Best Customer Experience
Best Customer Experience & Contact Center Management - Life Insurance 2021^³
Asia's Best Insurance Company
Asia's Best Insurance Company Award for CSR Activity & Digital Sales Channel^¹
Life Insurance Company of the Year
BFSI Excellence - Life Insurance Company of the Year 2021^²
Best Customer Experience
Best Customer Experience & Contact Center Management - Life Insurance 2021^³
List of Riders Available with Our Investment Plans
The following six riders⁹ are available with Edelweiss Tokio Life Investment Plans:
He was very much clear about the issue and the importance of it.. Thanks rohit
Anisha Shashidharan
(sr.associate)
Your customer support is doing excellent job.keep up the good work.
Nilesh Pawar
(manager)
It was very good experience. they understand my problem and solved it and given time to me, thank you.
Kumar Devam
(pvt teacher)
Thanks, all queries resolved in one call to satisfaction. I am rating the services as 10.
Kanika Chaudhary
(DESIGN ARCHITECT)
Very helpful during call thanks to Ms Ayesha A customer care executive
Sudeep priyo Bagh
(teacher)
The Customer Care Executive - Ms Afreen Sheikh was very prompt in resolving my query!!
Devanshu Gandhi
(Buisness owner)* Tax benefit of ₹ 46,800 is calculated at highest tax slab rate of 30% (in addition to income tax, cess of 4% is also applicable) on life insurance premium u/s 80C of ₹ 1,50,000. As per provisions of Income Tax Act, 1961. Tax benefits are subject to changes in tax laws.
1- This is applicable only if all due premiums are paid and the policy is inforce.
2- For more details please read the sales brochure separately
3- As per provisions of Income Tax Act, 1961. Tax benefits are subject to changes in tax laws.
4- If declared, Cash Bonus is a non-guaranteed bonus which may be payable based on the performance of the participating fund of the Company.
9- Riders are Optional and available at extra cost.
^¹ - Festival Of Insurance Awards 2020 on Sahara Samay Hindi News Channel on 27th December, 2020 - YouTube. For CSR Activity and Digital Sales Channel (Insurance Alerts Excellence Awards 2020)
^² - https://cloud-user-recordings-ffmpeg-converted-prod.s3-ap-south-1.amazonaws.com/recordings/ccd117b0-be48-11eb-9782-b590083730e8/3b7e25a3-b9b4-47b0-9f68-70eeb8062d60/ccd117b0-be48-11eb-9782-b590083730e8_0001_474830a2.mp4 (Awarded by Quantic Business Media BFSI Excellence Awards 2021)
^³ - https://thealdenglobal.com/inflection-conference-awards/
^⁴ Claim statistics are for Financial Year 2020-21 and is computed basis individual claims settled over total individual claims for the financial year. For details, refer to Public Disclosures in our Website.
Edelweiss Tokio Life Insurance Company Limited.
IRDAI Reg. No.: 147. CIN: U66010MH2009PLC197336.| ARN:
Registered & Corporate Office: 6th Floor, Tower 3, Wing ‘B’, Kohinoor City, Kirol Road, Kurla (W), Mumbai 400070.
Toll Free No.: 1800 212 1212 | Fax No.: +91 22 6117 7833 | www.edelweisstokio.in
Flower & Edelweiss are trademarks of Edelweiss Financial Services Limited; Tokio is Trademark of Tokio Marine Holdings Inc. and used by Edelweiss Tokio Life Insurance Co. Ltd. under license.
The Linked Insurance Products do not offer any liquidity during the first five years of the contract. The policyholder will not be able to surrender/withdraw the monies invested in Linked Insurance Products completely or partially till the end of the fifth year.
Unit Linked Life Insurance products are different from the traditional insurance products and are subject to the risk factors. The various funds offered under this contract are the names of the funds and do not in any way indicate the quality of these plans, their future prospects and returns. Please know the associated risks and the applicable charges from your Personal Financial Advisor or the Intermediary or policy document of the Insurer. The premium paid in unit linked life insurance policies are subject to investment risk associated with capital markets and the unit price of the units may go up or down based on the performance of investment fund and factors influencing the capital market and the policyholder is responsible for his/her decisions. For more details on risk factors, terms and conditions please read sales brochure carefully before concluding a sale.