Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak Guaranteed Fortune Builder

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

Kotak e-Term

Protect your family's financial future. Know more

Kotak Assured Savings Plan

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

Kotak Guaranteed Savings Plan

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

Kotak e-Invest

Insurance and Investment in one plan. Know more

Kotak Lifetime Income Plan

Retirement years are the golden years of life. 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 Investment Worthy Enough

It is recommended to compare life insurance investment pros and cons before making your decision. Here is a analysis for you whether life insurance is worthy enough or not.

  • Dec 19, 2018
  • 13,340 Views

Life is uncertain and you never know when and how your circumstances may change in an instant. A sudden illness or an accident may result in severe injuries that prevent you from pursuing your career and earning an income.

To protect yourself and your loved ones from such uncertainty, you may avail of insurance policies. You may choose a life insurance policy that offers a lump sum payout to your beneficiaries in case of an unexpected incident during the policy term. Additionally, you may choose a health insurance plan that provides the benefits in case you are diagnosed with any of the covered illnesses.

Although insurance coverage is important, many people avoid it with the objective of saving the premium amount. To overcome this limitation, insurers offer certain types of investment insurance plans.

Some experts advise that you must not avail of insurance companies with an investment objective. Others may recommend earning some returns on your insurance investment. It is recommended you compare life insurance investment pros and cons before making your decision.

Pros of life insurance

Replace lost income

The primary objective of life insurance is to provide financial security to your family in your absence. In case you are unable to earn a regular income, an insurance plan offers a replacement to ensure your loved ones are able to sustain their lifestyles without facing financial difficulties.

Cover your liabilities

It is most likely that you have multiple debt obligations, such as home loans, car loans, credit card bills, and others. In case of an unfortunate event, you do not want to financially burden your family while they deal with the emotional loss. A life investment insurance plan will help ease the financial burden on your family to meet these various outstanding liabilities.

Tax-deferred growth

The premium you pay on your life insurance policy is eligible for tax deductions under section 80C of the Income Tax Act, 1961. Additionally, the death benefits paid to the beneficiaries in case of an untoward event during the policy term are tax-free. Moreover, if you survive the policy term, the maturity benefits are also tax-exempt under section 10(10D) of the Income Tax Act, 1961.

Meet your financial goals

You may have various goals during different stages of your life. For example, you may want to buy a home, plan for your children’s higher education, and ensure financial independence after retirement. You may use life insurance policies to meet these goals through planned investments in certain types of policies.

Additional benefits

If you require some additional liquidity to meet emergency fund requirements, you may borrow against your life insurance policy. Compared to most other types of loans, borrowing against the insurance plan is more cost-efficient and affordable. However, it is recommended you check with your insurer before you make your decision of borrowing against the policy.

A term insurance plan is the most affordable way to procure higher coverage. However, most term policies do not offer any survival benefits. It is recommended that you invest the money you save through a lower premium on your term plan in other financial instruments, which will help you meet your various life goals.

When you are evaluating life insurance investment pros and cons, you will realize that there are no cons to mention. After all, insurance can only be a good thing. Therefore, it is certainly worth investing in insurance. It is recommended you consider your financial situation and personal requirements before deciding on an investment insurance plan. To maximize the benefits from your life insurance plans, it is important you remain invested for a long period of time. Insurance is not an investment product if you are looking to earn returns in the short-term.

More importantly, do not buy an insurance policy only with an investment perspective. The primary objective of life coverage is to provide financial security to your loved ones in your absence. Therefore, it is recommended you invest adequately in insurance to cover your beneficiaries before you make additional investments in other types of instruments to meet your investment goals.

In this policy, the investment risk in the investment portfolio is borne by the policyholder.

Kotak e-Invest

Download Brochure

Features

  • Return of Mortality Charges*$
  • Enhanced Protection
  • Multiple Plan Options
  • Zero Premium Allocation Charges
  • Tax Savings^

Ref. No. KLI/22-23/E-BB/521

T&C

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Planning Financial Goals and Objectives of Financial Planning

Different Types of ULIP Investments in India

Asset Allocations in ULIP - Know the Top Benefits

वित्तीय संपत्तियां और उनके प्रकार

Here's Myths on Investments in ULIP Plans

FAQs on Taxation of ULIPs

How to Fix the 9 Most Common Financial Problems Your Family is Facing

What is Fund Value in ULIP?

What are the Best Investment Options for Young Adults?

What is Partial Withdrawal in ULIPs?

Early Investing and the Power of Compounding

Top 10 Investment Strategies to Create Wealth

यूलिप में 8 शुल्क जो आपको अवश्य जानना चाहिए

5 Reasons to Have a Child Education Plan

What is a Savings Plan and What are is Benefits?

Four Financial Lessons from The Vedas on Living Life to The Fullest

How To Invest Money In ULIP?

Got a Salary Hike? Here’s How to Plan your investment further

ULIP Frequently Asked Questions (FAQ) - Kotak Life

What are Index Funds, and How Do They Work?

How is the Compound Annual Growth Rate (CAGR) Calculated in ULIP?

How Much Wealth Can You Create from ULIP in 10 years?

What are the things to consider before buying ULIPs?

Why Are ULIPs Called Flexible Investments?

How to Start Saving Money in 10 Simple Ways?

What Happens If I Stop Paying My ULIP Policy Premium After Paying the First Premium? Will I Still Get The Return?

The lesser-known facts about ULIP policy that customers should be aware of?

Rate of Interest on Different Investment Plans in India

4 Rules To Keep In Mind To Secure Your Child’s Future Financially

Can You Have ULIP Plan and Health Insurance Plan Both?

How and when should you exit from bad-performing ULIP?

Know Why You Should Stay Invested in Your ULIP Plan

What is ULIP Plan, and How Does it Work?

What are Financial Assets & their types?

How to Apply for Death Claim Benefits in ULIPs - Kotak Life

How to Choose the Best ULIP Plans to Invest in 2022?

ULIPs: Suitable for all

Balancing Investment Between Risk and Return on Investments

What's Better for Your Child's Education? Child Plans or Mutual Funds?

ULIPs Investment – A Boon or Bane?

ULIP Plans Riders You Should Know About

Best Investment Options to Cover Your Child's Education

How to Set Financial Goals for Your Future

ULIP Vs Life Insurance Plan Know the Difference

What are ULIPs and their Types?

ULIP As An Investment Option For Senior Citizens

Know How to Invest at Every Age for Larger Returns

ULIP Withdrawal Conditions - Before and After 5 years

How to Make Your Financial Portfolio?

Best Investment Plans for Children - Secure Your Child's Future

How to Plan Your Child's Education - A Step-by-Step Guide

ULIP Tax Benefits: यहां निवेश करने पर मिलते हैं 5 बड़े फायदे

Why ULIP is Better Investment for Long-Term Wealth Creation?

ULIP NAV - Everything You Need to Know

8 Important Tips to Maximize Gains with ULIP Investments

What are the Advantages and Disadvantages of ULIP?

What is Premium Redirection in ULIPs Plans | ULIP Insurance Plans | Kotak Life Insurance

How to Plan your Investment to Achieve Periodic Financial Goals?

Understanding ULIP Risks: What are the Odds of Losing all my Money and Projected Returns?

Can You Invest in Both Term Insurance and ULIP?

Factors Affecting Share Prices In The Stock Market

Beginner's Guide to Wealth Creation: Meaning, Strategies, & Importance

Are Money Back Policies Helpful? A Complete Guide

5 Reasons Why ULIP Plans are One of The Best Retirement Planning Instruments

Which are the Best ULIP Plans in India for Children?

What is the Time Value of Money (TVM)?

Long Term Savings Plan - Best Savings Investment Plans in India

What is Savings and the Importance of Saving Money

What is Direct Investment and its Types?

Can ULIP Policy be Transferred?

What is a Bond Fund and How It Works?

What are the Best Investment Options for Students in India?

Can NRIs Invest in ULIP Plans Offered in India?

How to Create Short-Term and Long-Term Wealth with ULIPs - Kotak Life

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains

Why Do You Need A ULIP Plan - All You Need To Know

How ULIPs can help you achieve your financial goals

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Learn About Safe Investments with High Returns in India

Top 11 Investment Plans Available in India

Customising investments to manage your wealth

What Is Social Impact Investing and How Does It Benefit Society?

What is Equity Mutual Funds: Meaning, Types & Benefits

Corporate Bonds: Meaning, Types & Benefits

Is ULIP a Complex Financial Product?

Is the surrender value of ULIP taxable?

What is a Child Money Back Plan, and How Does it Work?

Which is Better – FD, Mutual Fund, SIP, or ULIP?

How To Track ULIP Performance?

What are Fixed Maturity Plans and Why Should I Invest in Them?

How has ULIP Grown Over the Last 3 years?

ULIP Plan as a Gift

What are the Best Investment Options for Beginners or Amateur Investors in India?

What are the Maturity Benefits in a ULIP Plan: Fund Value Sum Assured or Only Fund Value?

Here's are the uses of ULIP your must be aware of

First Job? Here are Some Tips on How to Manage Finances

How Can a Legal Nominee Claim ULIP Benefits are the Policyholder’s Death?

ULIP Capital Gain Tax: Check Tax Norms for Capital Gain on ULIPs

ULIP Benefits You Can Avail from Early Investing

All you need to know about Fund Switching in ULIPs

यूलिप के फायदे और नुकसान क्या हैं?

Endowment Plan vs Fixed Deposit?

Can I Surrender My ULIP Policy after 2 Years?

How Can ULIPs Help You Plan for Your Child's Future?

Single Premium ULIP or a PPF - Which One is Better?

Top ULIP Myths That You Must Stop Believing In

What is Lock-In Period in ULIPs?

What is NAV in ULIP, and How is it calculated?

ULIP Plan or Traditional Insurance Plans - Which is better?

What are loyalty additions, and how do they work in a ULIP?

What Is a Credit Score? Definition, Factors, and Ways to Raise It

Best Investment Options in India in 2022

What is ULIP Renewal?

What Is Financial Planning?

ULIP Investment Benefits You Must Know

Why is Portfolio Diversification Important? How to Diversify Your Portfolio?

How to Calculate Your ULIP Returns?

How to Cancel ULIP Policy?

How Can ULIP Plan be as an Investment for Your Child

Why ULIP Should Be a Part of Your Investment Portfolio?

5 Reasons to Buy ULIPS for a Financially Secured Future

Will AI be Your Future Financial Adviser? What Role Will Humans Play?

How to Save Money from Salary?

Receiving regular payouts at various stages of life

What are the Best Short-Term Investment Plans with High Returns?

Will You Need to Withdraw or Surrender Money From ULIP

Importance of Portfolio Management

Difference Between ULIP and Endowment Plan?

What is Fund Switch in ULIP? And ULIP Fund Switching Techniques

How Can ELSS Funds Help You Save Tax & Create Wealth?

Difference Between Guaranteed Savings Plan and ULIP

What is Mutual Funds? | How Mutual Funds Work, Definition

Do You Know the Difference Between Savings and Investment?

Why Should You Invest in NPS?

यूनिट लिंक्ड इंश्योरेंस प्लान में लॉयल्टी एडिशन कैसे काम करते हैं

ULIP policy: What happens when you stop paying ULIP policy premium during lock-in period

What is the Estimated Return Percentage on ULIP? Do Investors Get Compound Interest?

Unit-Linked Life Insurance (ULIPs) vs. Term Insurance

What are the Best Investment Options For Females?

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Planning for Your Child's Higher Education? Explore These Investment Options

How Safe is it to Invest in ULIP plans?

Investment Options for NRIs in India

6 Important Tips to Maximize Your Gains with ULIP Investments

Why are ULIPs One of the Best Tax Saving Instruments?

Is ULIP A Good Investment Option?

Best One-Time Investment Plans in India

Here's Whether You Should Link ULIP Plan with your Term Insurance

Savings Plan for Grandchildren

Why Should You Build an Emergency Fund?

Are Gains from ULIP Sale Taxable?

Difference Between Linked and Non-Linked Insurance Plans

Benefits of ULIP as a Child Insurance Plan

How to Build a Strong Financial Foundation For the Future?

Learn About Safe Investments with High Returns in India

What is SIP Calculator, and How it Works?

Safe Investment Options with High Returns for FY 2018-19

Are Investment Returns Guaranteed in a ULIP?

Difference Between Passive and Active Investing

Is This The Right Time To Invest In ULIP? Why or Why Not?

How to Use Recurring Investment Strategies to Build Wealth?

What are Some of the Safest Investment Options in India?

How to Increase Net Worth Along with Family Protection

Can ULIP Help in Achieving Short-Term Financial Goals?

यूलिप प्लान में परिपक्वता लाभ क्या हैं: फंड वैल्यू सम एश्योर्ड या ओनली फंड वैल्यू?

यूलिप के फायदे (Benefits of ULIP in Hindi)

ULIP vs FD - Which is Better and Why?

Which is a Better Investment - Mutual Funds Or ULIP?

What is ULIP and Its Benefits?

यूलिप और उनके प्रकार क्या हैं?

Investments Options to Buy a house in India

How Do One-Time Investment Plans Work?

What is Money Management? Definition & Example

Successful Financial Planning for Urban Women

8 Charges in ULIP That You Must Know

What are the Minimum and Maximum Investments in ULIP?

Planning For Children's Future

All you need to know about claiming maturity proceeds from Ulip

Why Should I Invest in ULIP?

Top 5 Investment Options in 2022 for Healthy Returns

How Increasing Your SIP Every Year Helps You Reach Your Financial Goal Sooner?

How to Manage Inheritance Money?

5 Best Long Term Investments To Add To Your Portfolio in 2023

Planning For Son or Daughter's Wedding

Top 5 Principles That Need to be Followed for Wealth Creation

Creating a second source of income with life insurance

Does Rupee Cost Averaging Work In Unit-Linked Insurance Plans?

What is Compound Interest, And How Do I Calculate it?

Here's Why it's a Good Time to Explore ULIPs as an Investment

Develop an investing plan

Best Investment Plans For You To Invest In 2023

How Is ULIP Different from Other Life Insurance Plans? Where Can I Invest - ELSS, ULIP, or PPF?

Tax-Deferred Savings Plan: Overview, Benefits, Works

Building wealth through regular investing

How Much Wealth Can You Create From ULIP in 10 years?

Do ULIPs Give Good Returns On Investments?

How to Manage Your Portfolio Like a Professional?