Taking out a life insurance policy covers the risk of dying early, by providing for your family in the event of your death. It also manages the risk of retirement providing an income for you in non-earning years. Choosing the right policy type with the coverage that is right for you, therefore, becomes critical. There are a variety of policies available in the market, ranging from Term Endowment and Whole Life Insurance to Money Back Policies, ULIPs, and Pension plans. Let’s see what each of these is about so that you can consider the one that best suits you. 1-Term Insurance A term insurance policy is a pure risk cover policy that protects the person insured for a specific period of time. It provides life cover without any savings/profits component. In a term insurance policy, a person has to pay a premium to the company every year for his specified chosen period.

• If he dies during the period of the policy, his beneficiary will get the full sum assured.
• If he survives, he will not receive any benefit.

For example, if  Mr ram buys a 50 lakhs policy for 35 years, his family is entitled to receive, the sum of Rs 50 lakhs, if ram dies within 35 year period. Term Insurance, as the name implies, is for a specific period, and has the lowest possible premium among all insurance plans. You can select the length of the term for which you would like coverage, up to 35 years. Payments are fixed and do not increase during your term period. In case of an untimely death, your dependents will receive the benefit amount specified in the term life insurance agreement. A term insurance policy is the cheapest form of life insurance as premiums are much lower in comparison to other life insurance plans. You can customize Term life insurance with the addition of riders, such as Child, Waiver of Premium, or Accidental Death. 2-Endowment Insurance Endowment Insurance is ideal if you have a short career path, and hope to enjoy the benefits of the plan (the original sum and the accumulated bonus) in your lifetime. In simple words, we can say An endowment policy tries to combine risk cover with financial savings. The major difference between a term insurance policy and endowment policy is with respect to maturity benefits. Endowment plans are especially useful when you retire; by buying an annuity policy with the sum received, it generates a monthly pension for the rest of your life. In an endowment policy,

• If a person dies during the period of the policy, his beneficiary will get the sum assured.
• If he survives the policy tenure, he will generally get back all the premiums paid, along with benefits like bonuses.

Some insurers also offer additional benefits like marriage and education endowments, double endowments and so on. 3-Whole Life Insurance A whole life policy covers a person for his entire life from the time the policy is taken. Whole Life Policies have no fixed end date for the policy; only the death benefit exists and is paid to the named beneficiary. The policyholder is not entitled to any money during his or her own lifetime, i.e., there is no survival benefit. This plan is ideal in the case of leaving behind an estate. The person will avail himself of a cover throughout his life. He has to pay regular premiums until his death at which point his beneficiary gets the full amount. Primary advantages of Whole Life Insurance are guaranteed death benefits, guaranteed cash values, and fixed and known annual premiums. 4-Money-Back Plan In a Money-Back plan, you regularly receive a percentage of the sum assured during the lifetime of the policy. Money-Back plans are ideal for those who are looking for a product that provides both – insurance cover and savings. A Money back policy offers the payment of partial survival benefits when the insured is still alive. The insurance company pays a portion of the sum assured is at regular intervals. If the insured person dies during the period of the policy, the beneficiary gets the full sum assured Money back policy is a variant of an endowment policy. It creates a long-term savings opportunity with a reasonable rate of return, especially since the payout is considered exempt from tax except under specified situations. 5-ULIP Unit Linked Insurance Plan or ULIPS are an insurance product where the insured person’s money is invested with the intention of earning additional income. ULIPs are supposed to provide a combination of life cover along with an opportunity for wealth creation.Unit-linked Insurance Plans (ULIPs), introduced by the private players, are hugely popular because they combine the benefits of life insurance policies with mutual funds. A certain part of the premium is invested in listed equities/debt funds/bonds, and the balance is used to provide for life insurance and fund management expenses. ULIPs are essentially a variant of the traditional endowment plan and pay out the higher of sum assured or the investment portfolio on death/maturity. 6-Pension Plan Insurance companies offer two kinds of pension plans – endowment and unit-linked. Endowment plans invest in fixed income products, so the rates of return are very low. Unit-linked plans are more flexible. You can stop contributing after 10 years and the fund will keep compounding your corpus till the vesting date. You can opt for higher exposure in the stock market for your plan if your risk appetite allows it. Lower risk options like balanced funds are also offered. 7-GROUP life insurance A group life insurance is an insurance  policy where a group of people has been named under a single policy Employers generally add many employees to the same policy. As the name suggests, group insurance is a product designed to provide life insurance to a group of people under a single master policy. A group insurance policy can be taken by any group of people, big or small, that comes together for any reason, apart from that of specifically benefitting from an insurance scheme. A group policy extends to anyone irrespective of their age, gender, profession, social background and such factors. Group insurance is not limited to only employer-employee groups but is extended to other homogenous groups too. 8-Children’s Policies These plans can be taken in the name of the child or the parent. However, it is only for the benefit of the child. This helps parents mobilize finances when the child reaches a particular age or stage of life. 9-Annuity Plans just like a term insurance policy, this type of insurance aims at covering income loss. After retirement, an individual is cut off from a regular source of income, and any benefits, like gratuity or provident funds, run the risk of getting exhausted quickly. A pension is a model provision for safeguarding retirement, As the benefit is like a regular income. So, it is best to get pension plans in order to ensure financial independence after retirement.