Compare Permanent Life Insurance Policies

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  • What is Permanent Life Insurance?

    • The permanent life insurance plan covers the insured for his/her entire lifetime. Unlike term plans, permanent life insurance plans have no expiry period. Such plans offer the insured death benefit as well as a saving component against which the insured can borrow a loan or make a cash withdrawal.
  • Why Permanent Life Insurance?

    • It is only wise to get a permanent life insurance as it gives an edge over term plans. Firstly, by extending the risk cover to the insured's whole life. Secondarily, it also keeps on earning cash value from the premiums, which can be utilized by the insured in forms of loans or withdrawals.
  • What are its Key Features?

    • Permanent life insurance is costlier than term insurance as it also offers the savings component. The longer tenure a permanent life insurance plan is continued, the higher will be the cash value of the savings. The insured can enjoy the tax benefits not only on the premium paid but also on the withdrawal made thereof.
  • What are its Types?

    • Permanent life insurance comes in 3 variants – whole life, universal life and variable life plans. In whole life plans, there's no change in the premium and the return is guaranteed. In universal plans, the insured can raise or lower the premium. In variable life plans, the choice of investing cash remains with the insured and the return is not guaranteed.
  • Documents Required (if any)

    • Age Proof
      Identity Proof
      Address Proof
      Income Proof
      Duly Filled Proposal Form
      You may need to undergo Medical Tests in some cases.


Max Life

Permanent Life Insurance

Permanent Life Insurance is an umbrella term for life insurance plans that do not expire. Most permanent life insurance policies have a feature known as "cash value" or "cash surrender value." This feature, not found in most term policies, provides you with some options. The main advantage of a permanent life insurance is the policy accumulates a cash value against which you can borrow. Loans must be paid back with interest or your beneficiaries will receive a reduced death benefit.

Difference between Term Insurance and Permanent Insurance:

• Term Insurance provides coverage for a specific period of time whereas Permanent life Insurance provides coverage throughout the lifetime of insured provided policy is in-force, i.e. active.

• Term Insurance does not provide cash value whereas permanent does.

Disadvantages of Permanent Life Insurance

• Required premium levels do not buy enough protection components for you in life insurance.

• Permanent life insurance are more costly than term insurance

The various types of permanent life insurance policies are as follows:

1. Whole Life Insurance: It is the most common form of permanent life insurance. Whole life insurance risk covers the death of the insured, whenever it may happen. It means that there is no fixed term under whole life insurance. Most policies provide a dividend to the policy holder which helps with retirement. Whole life policies provide insurance until the death of the insured person. Whole life policies are classified into.

Pure Whole Life Insurance: where premiums are payable continuously throughout the life of the insured till death. Risk coverage is for the entire duration of life and the life insured amount is paid on the happening of the death of the insured at any time.

Limited Payment Whole life Insurance: where premiums are paid for a limited and shorter period and the option of the insured or till death if earlier. Risk coverage is however throughout the life of the insured.

Universal Life Insurance: A permanent life insurance policy that lets you customize your coverage and premiums as per your needs Universal life insurance provides more flexibility than whole life insurance by allowing the policy owner to shift money between the insurance and savings components of the policy. Premiums are paid into your policy's account value (after a premium expense charge), where it earns interest. Every month, various deductions, such as a charge for insurance protection, are then made from the account value. You have the ability to take loans or make withdrawals from the account value for your personal needs. Loans accrue interest and unpaid loans plus interest and withdrawals will reduce the death benefit and cash value. The policy continues as long as the cash value is sufficient to cover the various deductions each month.

2. Limited Pay Policy: A policy where you have to pay a fixed number of premiums for a specific numbers of years or till you reach a specific age.

3. Endowment Policy: Endowment policies cover the insured for a specified period. Thus, the insured has the option to insure himself till he wishes to be insured. Upon the death of the insured (during the term of the policy), the nominee receives the sum assured plus the bonus, if any. Bonus is paid for the number of years the policy was in force. Upon maturity, the insured receives the sum assured plus the bonus for the term of the policy, if any. Thereafter, the insured is not covered by the policy. Endowment policies are usually more expensive in comparison to whole life policies. Endowment policies are broadly classified into two types - Endowment - Without profit and Endowment - With profit.

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