Mumbai, January 3: Life insurers offer various products to provide financial security with new features to attract individuals with flexible income. Those individuals can buy life insurance plan for longer policy term with lesser premium paying term option. For those who could not afford single premium option or regular premium can buy limited premium option ULIPs plans to meet their financial goals.
There are various types of limited premium payment ULIPs plans available in the market. Life insurers allow the policyholders to get the maximum benefits even if they stop the premium payments after a stipulated period of time by converting the normal insurance policy into a fully paid up policy. These types of plans are known as limited payment period life insurance plans.
Limited premium paying plans allow an individual to pay the premiums for a limited period of time say 5, 10 or 15 years and will get the cover for the entire policy term. However, the policy period and premium paying term may varies from insurer to insurer. According to one’s requirements and affordability one can choose the policy term as well as premium paying term.
According to one’s preference, one can switch the investments within the available funds, depending on financial priorities and investment decision. Varies from insurer to insurer the switching charges or restriction on number of switches during entire policy term. Most of the ULIPs available in the market also offer single premium option, limited premium and regular premium too. The payment mode are monthly, quarterly, half yearly and yearly.
Some of the plus points of opting limited premium paying options are no risk of losing benefits on maturity if you are paying the premium during the policy tenure. One can enjoy the benefit to stay insured during the policy term by paying limited premium. For instance, for a 15 years policy term ULIP plan under limited premium paying option a policyholder have to pay for only five years and insured for the entire term of the policy.
However, before opting for limited premium paying option one has to look for affordability. As these types of plans are designed for shorter premium paying options and hence one has to pay higher premium amount during the paying term.
On the other hand, the policyholder can choose the fund option based on past fund performance and invest for higher returns. Most of the insurers provide past fund performance history.
ULIPs product with limited premium paying option