Max Life’s excellent online term plan
The new plan from Max Life isn’t your average online term plan. The insurer has created a policy with two impressive options that could well be worth the extra premium.
Term plans, as we’ve reiterated numerous times, are all the insurance you need. We’ve looked at the cheapest online plans already, the inadequacy of the home buyers’ term plan and the advantages of buying multiple policies. But just as we thought there could be no more to write about term plans, Max Life has come up with an excellent new plan that many of you will find favourable.
All insurance is about providing security to those dependent on you in the case of your untimely death. With term plans, the entire sum assured – usually a hefty sum – gets paid out immediately. However, the policyholder is also quite often the person who manages the money and plans the investments. If your spouse or parents aren’t good with money, have you given a thought to how they would manage this huge payout?
The Max Life online term plan offers a small solution. Aside from the basic plan, which would pay out the sum assured in case of the death of the policyholder, it offers two options. Both of them give the beneficiaries the advantage of a regular ‘income’. Here’s how they work:
Option 1: The sum assured plus level monthly income option will pay out the sum assured immediately and for 10 subsequent years, will pay out a sum of 0.4% of the sum assured. So if the sum assured is Rs1 lakh, the beneficiaries would receive Rs40,000 per month for 10 years.
Option 2: The sum assured plus increasing monthly income option will pay out the sum assured first. In the next year, a sum of 0.4% of the sum assured would be paid monthly. In subsequent years, these payouts will increase by 10% (simple interest) each year. So Rs44,000 in the second year, Rs48,400 in the third and so on.
What’s good about it?
The advantage with the two above plans is that they create an income for your family for 10 full years, in addition to the sum assured, and all at a good price. While you could argue that you could simply take a larger policy instead, consider that your family may find this system more manageable. For 10 years, there would be less of a need to create an income stream from the sum assured.
What does it cost?
|30||Rs1 crore||20 years||Rs9,000|
|35||Rs1 crore||20 years||Rs12,000|
|40||Rs1 crore||20 years||Rs17,500|
|30||Rs1 crore||20 years||Rs9,900|
|35||Rs1 crore||20 years||Rs13,200|
|40||Rs1 crore||20 years||Rs19,300|