ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Learn More About: Securing Your Income with Money Back Plans

Updated on June 26, 2015

It is a given that all your investment strategies are aimed at securing your income. If liquidity and returns are the two key factors which help you zero in on a financial instrument, then money back plans might just fit the bill. One of the most sought-after life insurance plans, money back plans help secure your income with no hassles.

What are money back plans?

Life insurance comes in many forms. Under money back plans, the insured person gets a percentage of the sum assured at regular intervals after completion of a certain period of time.

Who are these plans suitable for?

Owing to its scope for liquidity as well as saving and protection through insurance, money back plans are most suitable for individuals with a low-risk appetite seeking to create an income stream.

Choose Moneyback Plans for good returns.
Choose Moneyback Plans for good returns.

Benefits of money back insurance plans

These plans offer many attractive benefits. Depending on the company and its offering, plans are developed to suit varied needs of insurance-seekers based on their financial and protection requirements. Some of the key features have been listed below.




  • Sum Assured plus all bonuses payable in a lump sum upon death
  • Allows for planning children’s education or marriage
  • Provides a cover for life
  • Maturity benefits paid in installments by way of survival benefit at regular intervals.
  • Guaranteed liquidity
  • Bonus is calculated on the full sum assured.
  • Most useful for businessmen
  • Protects you and your family at every stage

What are the key features of a money back plan?

Under a money back plan, the entry age is usually set at a minimum of 13 years and a maximum of 50 years. These plans can be held by policyholders up to the age of 70 years in most cases. Often taken for the long-term, they feature varying tenures ranging up to 25 years.

Premium payments are usually flexible and payments can be made according to a policyholders comfort on a monthly, quarterly, half-yearly or annual basis.

In addition, reversionary bonuses are offered every year enhancing the payout due to a policyholder.

Endowment vs Moneyback
Endowment vs Moneyback

Are endowment insurance plans different from money back plans?

Under ordinary endowment insurance plans, survival benefits are paid at the end of the endowment period whereas money back schemes allow periodic payments of partial survival benefits, as long as the policyholder is alive.

What’s more, under money back plans, in the event of death of the insured person, the nominee gets the entire sum assured. Also, survival benefits are not deducted. Bonus payable is calculated on basis of the full sum assured.

Outlined below are examples of how endowment plans differ from money back plans.

Moneyback vs Endowment

Plan
Sum Assured
Premium
Maturity
Endowment
AED 6,00,000
AED 28,773
AED 12,84,000
Moneyback
AED 6,00,000
AED 37,678
AED 7,68,000
The difference between an endowment plan and money back plan offered for a period of 20 years is shown in the table above.

As per money back policy, you will get 1.2 lakhs (20% of sum assured) every 5 years besides the maturity amount.

Besides coverage and costs, money back plans and endowment plans can differ in terms of other features as well. An example is outlined below.

The following is a comparison of the features and benefits provided by Reliance Super Money Back Plan and New Money Back - 25 Years (plan no. 821)

Features of a Reliance super money back plan are as follows:

  • Benefits at the end of every five years
  • Increasing regular monthly income payouts
  • Maturity addition at the end of the policy term
  • Life cover 10 times the annualised premium
  • Policy terms of 10 to 50 years and pay for only half of the policy term
  • Loyalty additions at the end of the premium payment term
  • You can enjoy tax benefits on the premiums and benefits

Features of a new money back (plan no. 821) are as follows:

  • Premium payment term is 20 years
  • Survival benefits are paid periodically
  • Double tax benefit (80C and 10 D)
  • Balance of the sum assured plus accrued bonuses are paid at the end of policy term
  • Additional accidental sum assured
  • Death risk cover is 125% of the sum assured
  • Availability of loans against this plan

Grow your income with Moneyback Plans
Grow your income with Moneyback Plans

If you are looking to save your income and want regular benefits to secure your family against the vicissitudes of life, money back plans may just be the right choice for you. However, due consideration will have to be given with regards to your personal financial savings, protection and liquidity goals when opting for these plans. Always note that the primary aim of a life insurance policy is to provide financial protection in the adverse event of death.

Comments

    0 of 8192 characters used
    Post Comment

    No comments yet.

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)