When you purchase a life insurance policy, you are expected to make regular premium payments to your insurer as per the premium payment schedule. Policy buyers can usually choose to pay their premiums on an annual, bi-annual, quarterly, or monthly basis. However, certain life insurance providers also offer insurance policies, where the premium can be paid as a one-time lump sum amount.
Benefits of Single Premium Insurance Plans
Single premium insurance plans are an especially good choice for individuals who have a lump sum amount of money in-hand and are looking for a financial avenue to invest in. They are also ideal for individuals without a steady flow of income since they don’t have to go through the hassle of making repeated premium payments. A few other benefits of these policies are listed below:
- Policyholders do not have to go through the hassle of remembering the premium payment due date.
- Customers do not have to go through the risk of a policy lapse or termination with a single premium insurance plan.
- In addition to the regular policy benefits, single premium insurance plans can also sometimes come with built-in features that enhance the policy coverage.
- Individuals who purchase single premium insurance plans can avail tax benefits.
Top 5 single premium insurance plans offered in India:
Almost all leading life insurance providers offer at least a few single premium insurance plans within their product suite. Listed below are 5 single premium insurance policies that are offered by life insurance firms with the highest claim settlement ratio in FY16-17.
1. LIC’s Jeevan Akshay – VI Plan: The Jeevan Akshay – VI Plan from LIC is a non-linked, single premium payment, immediate annuity policy that provides annuity payments throughout the lifetime of the policyholder. This policy comes with various annuity options and annuity payment mode options.
Key Features of LIC’s Jeevan Akshay – VI Plan:
- The minimum purchase price of this policy is Rs.1 lakh. In case the policy is purchased through online channels, the minimum purchase price is Rs.1,50,000.
- Policy buyers need not go through a medical examination to purchase this policy.
- The minimum age at entry for this policy is 30 years.
- The insurer provides up to 7 annuity options for the policy buyer to choose from. Once chosen, the annuity option cannot be changed by the policyholder.
2. Max Life Guaranteed Lifetime Income Plan: The Guaranteed Lifetime Income Plan is a non-participating, non-linked, immediate annuity plan that provides guaranteed income to the policyholder for their entire lifetime.
Key Features of the Max Life Guaranteed Lifetime Income Plan:
- This policy comes with four annuity options.
- In the event of the policyholder’s death, the nominee will receive 100% of the policy’s purchase price, in case the policy buyer had opted for the following annuity options - Single Life/Joint Life Annuity Plans with Return of Premium (ROP).
- This plan can be purchased individuals between 50 years and 80 years.
- The minimum monthly annuity payout for this policy has to be at least Rs.1,000. The minimum single premium payable will be decided on this basis.
3. HDFC Life New Immediate Annuity Plan: The New Immediate Annuity Plan from HDFC Life is a traditional, non-linked, single premium, immediate annuity policy that provides you the means to live a comfortable life even after your retirement.
Key Features of HDFC Life New Immediate Annuity Plan:
- This policy comes with a range of annuity options to cater to the varied needs of customers.
- Policy buyers can choose the annuity payout frequency. Thus, you can choose to receive your annuity on a monthly, quarterly, half-yearly, or yearly basis.
- The insurer provides higher annuity rates for larger purchase prices.
- Once purchased, annuity payments are guaranteed by the insurer for the policyholder’s lifetime.
- Individuals between 30 years and 85 years can purchase this policy.
4. Aegon Life iReturn Insurance Plan: The iReturn Insurance Plan provides you a life cover for the duration of the policy tenure and also returns all premium paid back to you if you survive till maturity of the policy. Policy buyers can choose to pay the due premiums for five years, for the duration of the policy tenure, or as a one-time lump sum amount.
Key Features of Aegon Life iReturn Insurance Plan:
- This policy offers a death benefit to the nominee, in the event of the policyholder’s untimely death.
- At maturity of the policy, the policyholder will receive all premiums paid during the policy tenure.
- This policy comes with an inbuilt terminal illness benefit.
- This policy can be purchased by individuals between 18 years and 65 years.
- The minimum and maximum sum assured for this policy are Rs.30 lakh and Rs.4 crore, respectively.
- Policy buyers can choose a policy tenure of 5 years, 10 years, 15 years, or 20 years.
5. SBI Life – Smart Wealth Assure Plan: This is a non-participating, unit-linked, life insurance policy that can be purchased by paying a single premium. This policy offers financial security to the policyholder’s family, flexibility, and offers liquidity from the 6th policy year onwards. Further, these plans are also affordable.
Key Features of the SBI Life – Smart Wealth Assure Plan:
- Policy buyers can choose between two funds based on their appetite for risk.
- The policy will provide coverage throughout the policy tenure, even though the policy buyer only has to pay only a single premium.
- Individuals between 8 years and 65 years can purchase this policy for a policy tenure between 10 years and 30 years.
- The minimum single premium amount is Rs.50,000.
The Bottom Line
While there are a plenty of single premium life insurance plans, across various product types, available in the market, you will need to do your due research, compare various plans, and opt for a policy that offers premium rates and coverage as per your needs.