Which is better Single Premium Or Yearly Premium for Insurance Plan.


Recently, I was researching about the term insurance plan that would fit to my pocket and also i would able to pay it on financial status.

As I have some insurance policy of LIC, I believed to go with them for term plan too. then i have found one plan that good for mine.

Product Number : 190
Product Name : Amulya Jeevan

and as per my requirement, i need 30 lacs insurance for my life ..and need for 20 years .

And after researched about this policy with my requirement and years, firstly i found that single premium option is good and looked nice ..but ..think ..more ....


think ..more ..


i have to pay 77,700 as single premium and i have not bother about premium, i insured with 30 lacs for next 20 years ..and its nice ..

also second option for yearly premium, i have
to pay 6900/- rs for next 20 years so if you calculated howmuch you would pay after 20 yrs then you have to pay 20*6900 = 138000

So you would think ..instead of paying 138000 for 30 lacs.20 year, you would think that 77,700 single premium would work better ...and you would go with this ..is'nt it ? but you should not go ..

i will explain you why is yearly premium is better than single premium for my case and even better for your too ..
Lets think that instead of paying 77,700 as single premium for your policy, do one thing
As per current FD(fixed deposit) is 10.25 % and even for senior citizen is 10.75% *( could be different for others bank .i am disclosed bank name here)

Lets take you would get minimal 9% for FD and if you put your 77,700/- on FD after deduct your first year premium 6900/- , it would 70,800 and put on FB ..so after one year, means on second year when your yearly premium time is come ..your FD would be 77,172 and give your 6900 from this amount and keep remaining 70,272 rs on FD ..and continue follow this process ..

Did you think ..what are benefit of this ?

1)Your 77,700/- rs would not block ..
2)You could stop policy any time ..and you would not lose any money or minimal money
3)You would easily pay yearly premium from FD , not from salary
4)Any time, in future if you need money ..you could stop FD and get all money ..and use it ..


And you could get maturity amount in term insurance plan that wont possible, wont offer in any insurance company ..

Enjoy this my first personal finance blog :)

Thanks


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