Traditional life insurance provides coverage for the entire lifetime and can be used to provide financial protection against unexpected events such as death, disability, or critical illness.
- Life insurance can be expensive if you're unhealthy or old.
- It offers Low Coverage Amount
- If an individual surrenders his policy before the completion of the policy term, then he will only be able to recover the paid-up value.
- Traditional life insurance does not provide any coverage for pre-existing conditions
What are the Benefits of Traditional Life Insurance?
Traditional life insurance offers several benefits that make it an attractive option for individuals seeking both life coverage and savings or investment growth. Here are some key benefits of traditional life insurance:
- Life Coverage
- Savings or Investment Component
- Maturity Benefit
- Tax Benefits
- Financial Security
- Peace of Mind
How Many Variants of Traditional Life Insurance?
Here are some common variants of traditional life insurance plans in India.
- Whole Life Insurance
- Money-Back Policies
- Endowment Plans
- Money-Back Plans
- Annuity Plans
What is Traditional Life Insurance in India?
Traditional life insurance refers to life insurance plans offering basic coverage and protection and any investment or savings component. These plans focus primarily on providing financial security to the policyholder's beneficiaries in the event of their untimely death. Traditional life insurance plans in India are popular among individuals looking for simple and cost-effective life coverage.
What are the Features of Traditional Life Insurance?
Here are some key features of traditional insurance plans:
- Guaranteed Benefits
- Maturity Benefits
- Savings or Investment Component
- Limited Flexibility
- Participating and Non-participating Plans
- Lower Market Risk
What is Non-Traditional Life Insurance?
Non-traditional life insurance refers to life insurance products that offer innovative features or structures beyond traditional offerings. These plans often provide additional benefits, flexibility, or customization options to policyholders. Here are a few examples of non-traditional life insurance plans available in India:
- Unit-Linked Insurance Plans (ULIPs)
- Guaranteed Savings Plans.
- Term Return of Premium (TROP) Plans
- Micro Insurance Plans
