Best Single Premium Insurance Plans

Let's talk about premium plans. These plans allow investors to invest a lump sum amount that will grow over time with interest. Unlike premium plans that need investments, single premium plans offer total flexibility and a hassle-free investment option. They guarantee returns over a certain period, making them appealing to investors looking for rates.

Single premium plans will be available from life insurers, mutual funds, banks, and NBFCs. We've compiled a list of 5 options based on factors like returns, costs, flexibility, and insurer reputation. Keep reading as we delve into each plan to help you find the fit for your investment goals.

What exactly is a Single Premium Policy?

A Single Premium Policy is a life insurance policy where you make a one-time lump sum payment to receive coverage for a term. It's like 'paying and forgetting.'

By making a premium payment, you secure life cover for the policy duration without needing to pay any more premiums. This approach offers the convenience of obtaining life insurance through a one-time investment while ensuring peace of mind.

Once the initial premium is settled, the policyholder can rest assured that they have life coverage for the selected duration without any payments.

Single Premium Policies provide an uncomplicated method to secure life insurance. The structure of payment reduces tasks and inconveniences in the long term. They are advantageous for individuals with a lump sum to invest who seek guaranteed insurance coverage without premiums.

Advantages of Top Single Premium Plans

A single premium plan is a life insurance policy where you pay the premium amount upfront. This plan is a one-time premium policy. Here are some of its advantages:

Tax Benefits

Single premium plans come with tax benefits per Section 80C and 10(10D) of the Income Tax Act. The lump sum premium paid qualifies for deduction under Section 80C up to Rs. 1.5 lakhs annually. The maturity payout and death benefit received are exempt from taxes under Section 10(10D), making them an effective tool for saving on taxes.

Life Coverage

These plans provide high life cover at a relatively low cost due to a single premium payment. The cover continues for the entire policy tenure once the premium is paid. This ensures financial security for dependents in case of untimely death of the policyholder.

Wealth Creation

The corpus accumulated over the policy term can be withdrawn on maturity. Many plans offer guaranteed additions to enhance returns. This allows wealth creation that can be used to achieve financial goals like children's education, retirement, etc.

Liquidity 

Many single premium plans allow partial withdrawals to meet emergencies. Some even offer loan facilities against the policy. This provides liquidity when required.

Best Single Premium Plans

The best single premium plans available in the market are as follows:

LIC Jeevan Vriddhi

LIC's Jeevan Vriddhi emerges as the forefront choice among single premium plans, offering a robust combination of features. Policyholders can opt for surrender after just one year, securing an impressive payback of up to 90% of the single premium. The sum assured is intricately linked to the insured's age and premium amount, providing a personalised touch to the coverage. Beyond the basic features, the plan also offers loyalty points, incentives for higher premiums, and the added advantage of availing a loan at an optimal interest rate.

Bajaj Allianz New Risk Care II

Bajaj Allianz New Risk Care II stands out as a pure-term plan, focusing on delivering substantial insurance coverage at a minimal premium. The uniqueness lies in its exclusion of maturity benefits, allowing policyholders to tailor their coverage by customising the sum assured and policy term. The plan also provides flexibility through the option to choose additional riders and benefits, ensuring a comprehensive approach to meeting individual insurance needs.

ICICI Pru iAssure Single Premium

ICICI Pru iAssure Single Premium is attractive, combining life cover with enticing risk returns. The maturity amount is calculated based on multiple factors, including gender, age, policy term, sum assured multiple, and applicable reference rates. This results in a sum assured, ranging from 125% to 500% of the single premium, providing policyholders with a spectrum of coverage options suited to their unique circumstances.

Max New York SMART Steps Single Premium

Max New York SMART Steps is a standout child ULIP offering flexibility and liquidity. With multiple investment options such as dynamic floor fund, frontline equity fund, and dynamic bond fund, policyholders can choose based on their risk appetite. Beyond potential returns, this single premium plan also facilitates tax benefits under sections 80C and 10(10D), ensuring a holistic financial approach with maturity and death benefits.

Aviva Life Bond Advantage

Aviva Life Bond Advantage enters the scene as a single premium ULIP. This plan qualifies for tax benefits and provides a sum five times the premium amount. Its flexibility is further accentuated by the inclusion of ADB (accidental death benefit), the ability for partial withdrawals after a 5-year lock-in period, and the enticing prospect of loyalty additions at 4% of the fund value after a decade of policy continuation. Overall, a comprehensive plan is designed to cater to diverse financial needs.

Conclusion

While single premium schemes offer assured returns, they offer lower yields than market-linked investments like stocks, mutual funds, etc. If you have a moderate to high-risk appetite and want to beat inflation, consider investing through INDmoney.