Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Invest

Insurance and Investment in one plan. Know more

Kotak e-Term

Protect your family's financial future. Know more

Kotak Guaranteed Fortune Builder

A plan that offers guaranteed income for your future goals. Know more

Kotak T.U.L.I.P

A plan that works like a term plan, and Earns like ULIP Plan. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Assured Pension

A plan that offers immediate or deferred stream of income Know more

Kotak Lifetime Income Plan

Retirement years are the golden years of life. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and life cover. Know more

Close

Get a Call

Enter your contact details below and we will get in touch with you at the earliest.

  • Select your Query

Thank you

Our representative will get in touch with you at the earliest.

Is Life Insurance Worth It?

Life insurance is designed to offer financial security against the policyholder's demise and works as a good investment plan. Read on to know all about life insurance investment.

  • 4,448 Views
Amit Raje
Written By :
Amit Raje

Amit Raje is an experienced marketer who has worked in various Fintechs and leading Financial companies in India. With focused experience in Digital, Amit has pioneered multiple digital commerce in India. Now, close to two decades later, he is the vice president and head of the D2C business department. He masters the skill of strategic management, also being certified in it from IIMA. He has challenged his challenges and contributed his efforts in this journey of digital transformation.

Amit Raje
Reviewed By :
Prasad Pimple

Prasad Pimple has a decade-long experience in the Life insurance sector and as EVP, Kotak Life heads Digital Business. He is responsible for developing user friendly product journeys, creating consumer awareness and helping consumers in identifying need for life insurance solutions. He has 20+ years of experience in creating and building business verticals across Insurance, Telecom and Banking sectors

In India, most people have this misconception that financial planning is all about investments. However, the truth is financial planning is a much broader concept. It involves several aspects of money management like budgeting, dues and liabilities, credit management, tax planning, and insurance and investments.

Insurance and investment are the most important bricks that form the foundation of a sound financial plan. Insurance and investments are entirely different financial products, and they serve different purposes. Hence, you must not consider insurance as an investment.

When you buy a life insurance policy, you essentially purchase financial protection for your family against future uncertainties that can adversely impact your finances. Although no amount of compensation can replace the loss of human life, an insurance plan can help you mitigate the financial impact it can have on your family in the event of your sudden demise.

No matter the type of life insurance you buy, be it a term plan or any other plan, you must pay the premium to the insurance company. In return, the insurer agrees to pay the policy benefits, i.e., the sum assured to your family members in the event of your unfortunate demise. In a nutshell, the insurance policy acts as an income replacement for your family in your absence.

Why Insurance is not an investment?

In simple terms, an investment is a financial product that helps you generate wealth in the long run and build a corpus. You can invest in different products based on your understanding of the product, returns expectations, risk-taking ability, and financial goals.

You can invest in multiple products simultaneously to diversify your portfolio and mitigate the risk potential. Based on the investment you choose, you can get periodic returns, as applicable with fixed income schemes like bank fixed deposits.

While some insurance policies like the ULIP (Unit Linked Policies) and Retirement Plans have savings and investment components, the returns offered are incomparable to pure investment plans like mutual funds. Also, if you hold a term insurance policy, you do not get any returns, either on the survival of the policy term or during the policy tenure.

The main purpose of an insurance policy is to provide your family with financial protection against uncertainties of life and not to help you accumulate mass wealth and become rich. It only ensures that your dependent family don’t face any financial hassles when you are no more.

Why do people confuse insurance for investment?

One of the significant reasons people consider insurance as an investment is inadequate financial knowledge about insurance and investment products. Also, with the growing popularity of the new-age hybrid insurance-cum-investment products such as ULIPs, money back plans, people believe insurance is an excellent investment avenue.

However, you must know such policies fail on both fronts. Neither do they deliver substantial returns, nor do they provide adequate insurance cover.

What should you do?

The premium for the hybrid insurance policies is generally much higher than the pure protection plans like term insurance. So, many experts recommend purchasing term insurance with high coverage to meet the family’s future needs. And for investment purposes, it is better to choose a pure investment plan.

Make sure that you choose your investments carefully based on your long-term and short-term goals, risks involved, etc. Also, you must monitor your investments regularly and take necessary corrective actions when needed.

Kotak e-Term

Download Brochure

Features

  • Life Cover till 85 years for Life & Life Secure Option
  • 3 Payout Options
  • Special Rates for Women
  • Option to exit the policy with premium refund at the age of 60*
  • Special Rates for Non-Tobacco Users
  • Free Medical Check Up every 5th year**

Ref. No. KLI/22-23/E-BB/2435

T&C

- A Consumer Education Initiative series by Kotak Life