Insurance exists to protect the family financially — not as an investment. That is the core difference between term plans and traditional (endowment/money-back) policies.
Term insurance
- Large cover at a low premium — pure protection
- Family receives the full sum assured if the policyholder dies
- Usually nothing back on surviving the term — which is exactly why it is cheap
Endowment/money-back
- Insurance + savings mix; pays on maturity
- For the same premium, the cover stays much smaller
- Returns are generally modest against inflation
How much cover
Rule of thumb — 10–15× annual income, plus outstanding loans. Premiums rise with age, so buying early is cheaper.
While buying
- Never hide health/habit details in the proposal form — claims depend on it
- Check claim-settlement ratio and inform your nominee
General information only — discuss your situation with a registered adviser.
