Life Insurance

Types of Life Insurance

Life insurance should be the first step in future planning for any individual to lead a comfortable, stress-free life. But, there are different types of life insurance policies available in India, so…

Life insurance should be the first step in future planning for any individual to lead a comfortable, stress-free life. But, there are different types of life insurance policies available in India, so it is very difficult to decide which type of life insurance policy you need. To make these tasks easier for you, we have elaborated on the different types of life insurance policies along with their benefits.

Today, different life insurance policies cater to the different needs of every individual, such as

  • Retirement planning
  • Secure future
  • Saving for any specific goal
  • Child education
  • Investment planning

What is Life Insurance?

A life insurance policy is an agreement between the policyholder and the life insurance company that assures a certain predetermined sum amount to the nominee after the policyholder's death during the policy term or on the policy's maturity. A life insurance plan provides you financial security and comfortable life for your loved ones in the case of your absence. India has different life insurance policies, and each life plan has its key features and benefits. Hence, one must know which policy to choose before buying one.

Overview of Different Types of Life Insurance Plans in India

There are various Below mentioned are different types of life insurance policies in India:

Types of Life Insurance Plans


Term Insurance Plan

Pure risk cover

Endowment Plan

Insurance + Saving

Unit Linked Insurance Policy (ULIP)

Insurance + Investment

Whole Life Insurance

Life cover for whole life

Retirement Plan

Create retirement corpus

Child Plan

Secure child’s future

Money Back

Periodic return + Insurance cover

Let’s have a look at the different types of life insurance policies in detail:

Term Insurance 

Term insurance is also known as a pure protection plan. It offers a death benefit to the beneficiary/nominee if the policyholder dies during the policy tenure. If the policyholder survives the policy term, then the policyholder is not liable to file any claim under the term insurance plan. However, now life insurance companies are offering term plans with return of premium benefit (TROP). Term insurance is the most affordable life insurance policy. Term insurance can be classified into increasing, decreasing, and level term insurance.

USP: High sum assured at a low premium amount

Endowment Plan

An endowment policy is a type of life insurance policy that pays the policy benefits to the insured for the duration of the policy or to the beneficiary in case of death of the insured. You will get a combination of protection and savings with endowment plans. In this policy, in case of death of the Life Assured during the term of the policy, the nominee will get the Sum Assured plus any applicable bonuses, participating benefits, or guaranteed additions. Bonuses or benefits are paid based on how long the life assured survives during the policy term.

USP: Long-term saving option with minimum risk factor

Unit-Linked Investment Plan (ULIP)

ULIP plan is a combination of investment and insurance. It is a life insurance plan in which your premium will be partially used for risk cover and investment in the fund. In ULIP plans, the policy's cash value varies as per the current net asset value of the fund invested.

USP: A flexible long-term investment option

Whole Life Insurance

Whole life insurance is a type of life insurance that covers you for the duration of your life (100 years) which means that as long as you are alive, the policy is active. Moreover, the cash value portion of whole life insurance plans increases over time. You can withdraw your cash value or borrow money against it if it is more convenient. In addition, the death benefit paid to your beneficiaries will be reduced in the case of your demise before the loan is repaid.

USP: Life cover for whole life

Retirement Plan

A retirement plan is also known as a pension plan. It helps in building a post-retirement corpus to lead a comfortable life. You can secure your post-retirement life financially with the help of a retirement or pension plan. This plan enables you to maintain a consistent income even after you stop working and helps you achieve financial independence to enjoy life after retirement.

USP: Retirement Planning and Long-term saving

Child Plan

A child insurance plan is designed to secure the future financial needs of your child. It is a combination of savings cum investment plans. It gives you the benefit of investing in a child plan immediately after the child is born and an option to withdraw the savings when the child becomes an adult. Some child insurance policies waive off future premiums if the assured dies and the policy continues till maturity.

USP: Secure your child’s future and build funds for your child

MoneyBack Plan

The moneyback plan provides a percentage of the sum assured at regular intervals during your policy term. If you outlive the policy term, you will receive the remaining portion of the sum assured and the accrued bonus at maturity. But in case of the policyholder's death before the policy term, the beneficiaries get the entire sum assured amount in instalments. Moneyback Plans are the comparatively expensive life insurance plans offered by any life insurance company as they provide returns to the assured during the policy tenure.

USP: Short-term investment option to meet short-term investment goals


Every individual has to buy a life plan as per their needs. Term insurance plans are the best solution for people looking for an affordable life insurance policy. Whole life insurance is the best for people who can pay more and want life cover for their whole life. You can connect with the POSP advisors of the D2C Insurance Broking Private Limited (“RenewBuy”) to determine the best life insurance policy and company for you. They will help you to understand the pros and cons of each type of life insurance policy.


Disclaimer - The information published in this article is for the reader′s reference only. The content of this information is to provide an overview of your life insurance needs and should not be relied upon for personal, medical, legal, or financial decisions; you should consult an appropriate professional for specific advice. The Company makes no representations about the suitability, reliability, timeliness, and accuracy of the information, services, or any other items mentioned on this subject for any purpose whatsoever.


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