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Aditya Birla Sun Life Insurance Company Limited
Aditya Birla Sun Life Insurance Company Limited
Money Back Policy
Your Financial shield for Uncertain Times
Get immediate income payout after 1 day of policy issuance^
Features of Money Back Policy
Money back policies come with distinct features that differentiate them from other insurance plans. Here are the key features of a money back policy:
Survival Benefits:
These are periodic payouts made during the policy term. They are usually a fixed percentage of the sum assured.
Maturity Benefit:
If the policyholder survives the policy term, they receive the remaining sum assured (after deducting survival benefits already paid), along with bonuses or additional benefits, if any.
Death Benefit:
In the event of the policyholder's demise within the policy term, the nominee is given the full sum assured, irrespective of the survival benefits that have already been paid.
Bonus:
Some money back insurance plans may also accumulate bonuses, which are essentially a share of the profits made by the insurance company. These bonuses add to the total payout received by the policyholder.
Benefits of Money Back Insurance Policy
The main benefits of a money back policy are:
Periodic Returns:
Money back plans provide periodic payouts, which can serve as a steady source of income at regular intervals. This is especially beneficial in managing short-term financial goals.
Life Coverage:
Like other life insurance, policies money back plans provide life coverage, offering financial security to the policyholder's family in the event of the policyholder's untimely demise.
Maturity Benefit:
In the event the policyholder outlives the policy term, they receive the balance sum assured along with accrued bonuses, if any.
Tax Benefits*:
Policyholders can avail of tax benefits* on the premiums paid and the benefits received under Section 80C and Section 10(10D)** of the Income Tax Act, respectively.
How Does Money Back Policy Work?
A money back insurance policy is a type of life insurance plan that offers the dual benefit of insurance coverage and savings. It provides the policyholder with life cover during the policy term along with periodic returns as a percentage of the sum assured at regular intervals.
Here's a comprehensive look at how a money back insurance policy works:
Choose the Policy and Pay Premiums
To begin with, you select a money back policy that fits your needs and start paying the premiums. The premiums can be paid annually, semi-annually, quarterly, or monthly, as per the policy terms and your convenience.
Receive Survival Benefits
Once you've paid premiums for a specific number of years, the policy starts offering survival benefits. These are periodic payouts, which are a certain percentage of the sum assured. These payouts are made at regular intervals (such as every 5 years) during the policy term.
Policy Continues
Even after the survival benefit is paid, the policy continues with the risk cover for the entire sum assured. Your premium payments also continue as before.
Maturity Benefits
If you survive the entire policy term, you receive the maturity benefit. This typically includes the balance of the sum assured (total sum assured minus the survival benefits already paid) along with any bonuses declared by the insurer.
Death Benefits
In case of the policyholder's unfortunate demise during the policy term, the nominee receives the full sum assured along with any accrued bonuses, irrespective of the survival benefits already paid out. The policy ends once the death benefit is paid.
Optional Riders
Many insurers also offer optional riders like accidental death benefit, critical illness cover, etc., which you can opt for by paying an additional premium. These riders provide added protection and benefits over and above the standard policy benefits.
In summary, a money back insurance policy is a unique blend of insurance and investment that not only provides financial protection to your family in case of your untimely demise but also guarantees periodic returns during the policy term, ensuring liquidity.
11 Factors to Consider Before Buying a Money Back Insurance Policy
Before buying a money-back policy, it's important to consider the following factors:
When buying a money back insurance policy, it's crucial to carefully consider various factors to ensure that the policy meets your unique needs and financial goals. Here are some important factors to consider:
Financial Goals:
Understand what you want to achieve with the policy. Are you aiming for life cover, regular income, savings, or a combination of these? Knowing your financial goals will help you choose the right plan with the necessary features.
Coverage:
Consider how much coverage you need. This will depend on your financial liabilities, family’s living expenses, income levels, and future financial goals like children's education or marriage.
Policy Term:
Choose a policy term that aligns with your financial goals. For example, if you aim to fund your child's higher education, choose a policy term that matures around the time when the funds will be needed.
Premium Amount:
Make sure that the premium amount is affordable for you. It should not strain your finances or disturb your budget. Remember, defaulting on premium payments can lead to policy lapse.
Survival Benefit Payouts:
Check the frequency and the amount of survival benefit payouts. Choose a plan that offers payouts at intervals when you anticipate needing funds.
Company’s Reputation:
Research the insurance company's claim settlement ratio, customer service, and reputation in the market. A higher claim settlement ratio indicates that the insurer is more likely to settle claims successfully.
Policy Features and Benefits:
Examine the policy features, benefits, and the terms and conditions carefully. Look for any exclusions, limitations, or specific conditions that may apply.
Riders:
Consider adding riders for added protection. Insurance riders like critical illness, accidental death, disability benefit, etc., can significantly enhance your coverage.
Surrender Value:
Understand the surrender value of the policy, which is the amount you get if you decide to exit the policy before maturity. It’s important to know when your policy will acquire a surrender value and how much it will be.
Tax Benefits*:
Evaluate the tax benefits* associated with the policy. Money back insurance policies typically offer tax benefits* under sections 80C and 10(10D)** of the Income Tax Act.
Frequently Asked Questions on Money Back Insurance Policy
Money back policies are considered relatively low-risk investments as they offer guaranteed# returns and the bonus, if any, is not directly linked to volatile markets. However, as with any financial product, the performance of the insurance company can influence the returns.
The premiums paid towards a money back policy are eligible for tax deductions under Section 80C of the Income Tax Act, up to a limit of Rs. 1.5 lakhs per annum. Moreover, the survival benefits, maturity proceeds, and death benefits are generally tax-free under Section 10(10D)**, subject to certain conditions.
Money back policies are suitable for individuals seeking a combination of investment and insurance, with the added advantage of liquidity through regular payouts. They are particularly beneficial for risk-averse investors who want guaranteed# returns.
If you fail to pay the premium within the grace period, your policy may lapse, and you may lose the benefits of the policy. However, many insurers provide a revival period (typically 2-3 years from the first unpaid premium), during which you can pay the due premiums along with interest to reinstate the policy.
Insurance policies, including money back policies, are usually non-transferable. However, you can change the nominee of the policy by submitting the necessary form to your insurer.
Tax benefits are subject to changes in tax laws. Kindly consult your financial advisor for more details
# Provided all due premiums are paid.
**Sec 10(10D) benefit is available subject to fulfilment of conditions specified thereinz
1 Healthy male age 21 years investing in ABSLI Assured Income Plus Plan, premium paying term 12 years, policy term 13 years, benefit payout period 25 years, payment frequency annually, Assured Benefit Option: Income with Lumpsum Benefit, Sum Assured Rs.16.68 lakhs, Premium Rs.1.2 lakhs/year excluding GST), you get Rs. 55.18 lakhs (Rs. 1.52 Lakhs p.a. for 25 years and Rs. 17.28 Lakhs as lumpsum at end of benefit payout period)46.55 lakhs by age 584
ABSLI Vision LifeIncome Plan - This policy is underwritten by Aditya Birla Sun Life Insurance Company Limited (ABSLI). This is a traditional participating endowment plan. (UIN: 109N079V06)
All terms & conditions are guaranteed throughout the policy term, except for the bonuses which would be declared at the end of each financial year. GST and any other applicable taxes will be added (extra) to your premium and levied as per extant tax laws. An extra premium may be charged as per our then existing underwriting guidelines for substandard lives, smokers or people having hazardous occupations etc.
ABSLI Guaranteed# Milestone Plan - This policy is underwritten by Aditya Birla Sun Life Insurance Company Limited (ABSLI). This is a non-participating traditional insurance plan. All terms & conditions are guaranteed throughout the policy term. GST and any other applicable taxes will be added (extra) to your premium and levied as per extant tax laws. An extra premium may be charged as per our then existing underwriting guidelines for sub-standard lives, smokers or people having hazardous occupations etc. The insurance cover for the life insured (including minors) will commence on the policy issue date (UIN: 109N106V11).
ABSLI Nishchit Aayush Plan -This is a non-linked non-participating individual savings life insurance plan. UIN No 109N137V06
ABSLI Assured Savings Plan - This policy is underwritten by Aditya Birla Sun Life Insurance Company Limited (ABSLI). This is a Non-Linked Non-Participating Individual Savings Life Insurance Plan. All terms & conditions are guaranteed throughout the policy term. UIN: 109N134V08.
ADV/4/24-25/14
