All About Single Premium Life Insurance
The unpredictability of life makes it imperative for any responsible person to get a suitable life insurance policy. You can select from a wide range of insurance products available in the market to choose an insurance policy that ensures the financial independence and well-being of those dependent on you as well as secures your future. Single premium life insurance (or SPL) is one such insurance product that offers both of these and comes with a long list of benefits.
As the name clearly indicates, single premium life insurance is a term policy that you can buy by making a single lump sum payment. Thus, this insurance policy does not come with an instalment payment plan that requires payment of insurance premiums at fixed intervals.
Moreover, it offers death benefit and the amount awarded to beneficiary in the event of the death of the policyholder is higher than the amount that has been invested.
Types of Single Premium Life Insurance Available
There are two types of single premium life insurance available in the market.The first of these is Whole Life Insurance. Whole Life Insurance comes with a fixed rate of interest on the invested amount.
Secondly is Variable Life Insurance that offers a variable rate of interest on the invested amount. The rate of interest offered for this term policy is decided independently by the insurance provider and is based on several factors such as the age and life expectancy of the policyholder and the securities that the company invests in.
Thus, in order to get the best rates from an insurance policy provider, you should shop for life insurance quotes and compare the same to find the best deal for your money.
The Benefits of Single Premium Life Insurance
The foremost benefit of single premium life insurance is that it offers a guaranteed death benefit that can be as much as double the amount invested by the policyholder. To add to it, the policyholder gets a tax exemption on this investment and the death benefit awarded to beneficiaries is tax-free as well.
A further benefit of single premium life insurance has to offer is that it allows you to take a secured loan of up to 90% of this policy amount from a bank or a reputed financial institution. Thus, with a single premium life insurance you can create an estate to provide for your survivors and even rely on it to meet any monetary emergencies while you are still alive.