If you do not want to get into an agreement of paying endless premiums towards your life insurance policy and still avail all the associated benefits, limited premium payment insurance plan can serve you. This is because premium paying term is generally equal to the policy term which can span several years.
However some of the insurers allow you to choose a lower premium paying term as against making premium payments for the entire plan duration. For instance in some of the policies, insured after paying premium for a stipulated number of years say 5, 10 or 15 years can convert the regular policy to a fully paid-up plan and continue to reap all the insurance benefits.
The limited period for policy payment shall depend on the insurance plan type as well as term of the chosen plan.
Who should opt for limited premium payment insurance plans?
The individuals who do not have fixed income source such as self-employed class or who are reaching their sunset years and do not want to get into such long term premium payment commitments can opt for such an insurance plan. The plan is also suitable for those with flexible income stream as any sudden increase in income stream will allow them to pay due premiums without failure.
Also, those who are unsure of their capacity to meet the obligation for the entire term of the plan can take up such a plan.
The limited premium payment option is available for endowment, term plans as well as ULIP.
It is to be noted as insurance cover with all the benefits assured at the time of policy maturity are made available with the limited premium insurance plan just like the regular policy, premium amount on a per annum basis increases. So, before zeroing in on such a policy, you cannot afford to ignore your affordability for the same.