Money Back Policy
What is Money Back Policy?
Unlike ordinary endowment insurance plans where the survival benefits are payable only at the end of the endowment period, money back policies provide for periodic payments of partial survival benefits during the term of the policy, of course so long as the policy holder is alive.
An important feature of this type of policies is that in the event of death at any time within the policy term, the death claim comprises full sum assured without deducting any of the survival benefit amounts, which may have already been paid as money-back components. Similarly, the bonus is also calculated on the full sum assured.
How is it beneficial to me?
Under money back policies premiums can be paid as per the insurance company’s policy. These could be quarterly, half yearly or annually. The premiums for these policies are payable for the selected term of years, or till death if it occurs earlier.
By buying such policies one can receive income at regular intervals other than the risk cover it provides. Also a good amount of bonus on the full sum assured is quite a good bargain.
Who should buy this plan?
Such plans are particular popular with individuals for whom income at regular intervals is a necessity in addition to an insurance cover. The minimum age is 12 years to be eligible for a Money-Back Policy.