Life Insurance can be defined as a contract between an insurance policy holder and an insurance company, where the insurer promises to pay a sum of money in exchange for a premium, upon the death of an insured person or after a set period. Here, at ICICI Prudential Life Insurance, you pay premiums for a specific term and in return, we provide you with a Life Cover. This Life Cover secures your loved ones' future by paying a lump sum amount in case of an unfortunate event. In some policies, you are paid an amount called Maturity Benefit at the end of the policy term.

Types of Life Insurance

• Term Insurance Plans
  Term insurance protects your family's financial future if something were to happen to you. Designed as a simple and affordable way to give financial cover, a term plan is a vital part of financial planning for the primary wage earner in a family.
  Term insurance is a pure protection plan and is not market-linked. Moreover, the premiums for term insurance are lower as compared to any other life insurance product. The premiums are also more affordable if you buy them early in life. Experts often suggest that term plan should be a priority for you as soon as you start earning.
  Term insurance can be used for various purposes. In the absence of an income, your family can use the cover from the insurance to pay for their day to day expenditure, education costs, or wedding expenses.

• ULIPs - Unit Linked Insurance Plans
  A unit linked insurance plan (ULIP) is a combination of insurance and investment. A ULIP provides life cover that offers financial protection for your loved ones. In addition to this, it also gives you the potential to create wealth through market-linked returns from systematic investments. A ULIP offers you the opportunity to invest your money in different fund options, depending on your risk appetite. ULIPs come with a 5-year lock-in period, and the money can be invested in bonds, equities, hybrid funds, etc. On the other hand, if you are open to more risk, hybrid funds and equities have the potential to offer better returns. Since each individual is different, ULIPs allow great flexibility for investment. Your risk appetite and investment preferences are likely to change with age. ULIPs permit you to take these factors into consideration and alter your investment strategy accordingly.
  ULIPs also provide flexibility in terms of partial withdrawals and fund-switching. They offer interesting benefits like loyalty additions and wealth boosters to help you generate more wealth over time. Additionally, the maturity amount from ULIPs is tax-free* subject to Section 10(10D) of the Income Tax Act of 1961.

• Endowment Insurance Plans
  Endowment plans are ideal for people who want guaranteed returns along with the protection of life insurance. An endowment plan is a life insurance policy that provides life coverage along with an opportunity to save regularly. This enables you to receive a lump sum amount on the maturity of the policy. In case of death during the policy term, your nominee(s) also receives a death benefit.
  Just like ULIPs, endowment plans are quite flexible too. You can choose a suitable method and time frame to pay the premium. Endowment plans also give you a chance to benefit from bonuses that are paid additionally over and above the sum assured of your policy.
  Lastly, the returns generated on maturity from an endowment plan are tax-free* subject to Section 10(10D) of the Income Tax Act of 1961.

• Money back plan
  A money back plan is a life insurance policy where the insured person gets a percentage of sum assured at steady intervals. Since you save regularly, the money back plan rewards you regularly. In simple words, a money back plan is an endowment plan with the benefit of increased liquidity with systematic pay-outs. Money back plans are designed to help you meet your short-term financial goals. The money back feature can add to your monthly or yearly income.
  The regular pay-outs, which are tax-free subject to Section 10(10D)* of the Income Tax Act of 1961 makes the process of investing highly rewarding.

Advantages of Buying a Life Insurance Policy

• Death Benefits
  Life insurance enables individuals to protect themselves and their families, in case of any unfortunate happening in the life of the insurer. The insurer pays an amount equivalent to the sum assured as specified in the contract along with applicable bonuses. This is known as the death benefit.
• Wealth Creation through Investment Components
  A few life insurance policies offer wealth creation benefits as well. In such life insurance plans, you can invest your premiums in different funds based on your risk appetite. These life insurance plans are excellent wealth builders in the long run.
• Financial Security
  The primary importance of a life insurance policy is that it provides your family with long-term financial security. Life insurance policies provide a lump sum money to financially support your family in the case of your early demise. Plans like this can look after the family's regular expenses, future goals and any ongoing debts after your death.
• Loan Option
  A cheaper loan facility is one of the important benefits of life insurance plans. You can use your life insurance policy with the investment part for a loan as well. Life insurance plans like guaranteed savings plans, money back plans and whole life insurance policies acquire a cash value over time. You can borrow at a low rate of interest against this cash value.
• Life Stage Planning
  The importance of life insurance grows as you progress through your life stages. Life stages refer to the multiple major stepping stones like marriage, childbirth, home purchase, retirement, etc. You can use life insurance plans to prepare for each of these life stages. For example, term insurance for protection, child plan for child's marriage and education, ULIP for building wealth, the pension plan for retirement, etc.
• Assured Income benefit
  Assured Income benefit is another important benefit of life insurance plans. Term Plan offer a regular income pay-out option for your family after your early demise. Similarly, life insurance pension plans can offer a long-term guaranteed income to you and your spouse.

WHO NEEDS LIFE INSURANCE:-

• If a parent with minor children dies, the loss of their income or ability to care for their children may cause financial hardship. Life insurance can provide the financial resources the children require until they are able to support themselves.
• Seniors who wish to leave money to adult children who care for them-many adult children give up time at work to care for an ageing parent who requires assistance. This assistance could also offer direct financial assistance. When a parent passes away, life insurance can help pay for the adult child's expenses.
• Young adults without dependents rarely need life insurance, but if a parent will be responsible for a kid's debt after their death, the child may want to carry enough life insurance to pay off that obligation.
• Children and young people who want to lock in cheap rates-the younger you are and the healthier you are, the lower your insurance costs will be. If a 20-something adult expects to have dependents in the future, he or she may get an insurance even if they do not have them now.
• Married retirees can take their full pension and spend some of the money to buy life insurance for their spouse instead of deciding between a pension pay-out that includes a spousal benefit and one that does not. Pension maximisation is the term for this method.
• Those who have a history of pre-existing diseases, such as cancer, diabetes, or tobacco use. It's worth noting, though, that some insurers may refuse to cover such people or demand exorbitant prices.