How Edelweiss Life Insurance Can Help Build Your Savings

According to a market report, Life Insurance penetration in India increased from 2.3% in FY21 to 3% in FY23. This means that many Indians are still not covered under life insurance. One of the reasons for this could be that most people do not associate savings with ‘life insurance’. The common belief is that life insurance policies are a money sink that provide no benefits if you survive till the end of the term. However, this is no longer true!

The modern-day life insurance sector offers several products that not only secure your loved ones but also grow your savings if you survive till policy maturity. Edelweiss Life Insurance offers numerous life insurance products that come with a savings element.

The brand’s offerings include Guaranteed Income Plans, Unit-Linked Insurance Plans, and Participating Plans, each of which provide life cover alongside returns that are paid out during or after the policy term. If you’re looking for a life insurance plan that also grows your savings, here’s a breakdown of all the types of savings plans offered by Edelweiss Life Insurance.

What are Guaranteed Income Plans?

Knowing exactly what you’re going to get can be quite satisfying, right? Investments in the share market may or may not be profitable, but with a guaranteed income plan, you know that you will be getting back a modest sum no matter what! Edelweiss Life guaranteed plans offer a set rate of returns that remains unchanged until the end of your policy term. Thanks to this, you can quite accurately predict the value of your returns by the end of your policy term.

Moreover, Edelweiss Life Insurance offers guaranteed plans that provide a steady income throughout the course of your policy term. For example, Edelweiss Life- Premier Guaranteed STAR offers guaranteed regular income payouts after the end of the premium paying term. This passive income can give you the extra funds you need to fulfil your future financial goals.

Some Guaranteed Income Plans Offered by Edelweiss Life Insurance

Besides Edelweiss Life- Premier Guaranteed STAR, some other popular guaranteed income plans offered by us include:

• Edelweiss Life- Guaranteed Savings STAR: Option to get guaranteed returns as lumpsum on maturity or in 5 equal annual instalments. Plus, choice to enhance life cover to 20X the premium paid.

• Edelweiss Life- Guaranteed Income STAR: Option to get your guaranteed regular income as yearly as the second policy year itself.

• Edelweiss Life- Bharat Savings STAR: Choice to get income by first policy month, and you may even prepone a portion of your future income to get an early lumpsum payout.

What are Unit Linked Insurance Plans (ULIPs)?

Unit Linked Insurance Plans (ULIPs) are life insurance products that offer returns based on performance of market-linked funds. The premiums paid for a ULIP are invested into various funds that are managed by the insurer. These funds grow at market rates, meaning that your returns can be exceptionally good if the market performs well. However, the volatility of the market also makes ULIPs risker than guaranteed income alternatives. ULIPs offered by Edelweiss Life Insurance come with a choice of diverse funds, including debt funds that are more resistant to market volatility.

Popular ULIPs Offered by Edelweiss Life Insurance

Below are just a few of the Unit Linked Insurance Plans offers by Edelweiss Life:

• Edelweiss Life- Wealth Secure+: Start building your savings corpus at just ₹1,000 p.m. and get Loyalty Additions from our side by the end of your sixth policy year.

• Edelweiss Life- Wealth Rise+: A ULIP that also offers a guaranteed lumpsum amount at maturity. Moreover, this plan offers the ‘Little Star Benefit’, which ensures that your child will continue to receive the policy’s returns even after you pass away.

• Edelweiss Life- Wealth Plus: Get additional allocations starting from first policy year itself. Additions will be equal to 1% of your annual premium, and allocation will increase by 2% every 5 years.

What are Participating Plans?

Savings plans where your premiums are directly invested into the insurance company itself are known as ‘Participating Plans’ or ‘Par Plans’. Returns in a par plan depend upon the bonus rate declaration of your insurance provider. If your insurer is performing well financially, then a part of their profits will be shared with you in the form of a bonus. However, if your insurer underperforms in a given year, then their bonus rate will also drop. To put it simply, the returns you get from a participating plan are dependent on the financial performance of your life insurance provider.

Edelweiss Life Insurance has been consistently providing an average bonus rate of 9.04% for the past 12 years. So, rest assured that your savings will grow respectably if you invest in any of our par plan offerings.

Participating Plans Offered by Edelweiss Life Insurance

Below are a few par plans offered by Edelweiss Life Insurance:

• Edelweiss Life- Legacy Plus: This plan offers both guaranteed income as well as cash bonus payouts until you’re 100 years old! Moreover, you can choose to receive your cash bonus payouts from the second policy year itself.

• Edelweiss Life- Flexi Savings Plan: A flexible plan that lets you choose your payout start point. Choose from three plan options to get returns that best meet your financial goals.

• Edelweiss Life- Active Income: Option to get guaranteed income from second policy year itself. Your guaranteed income will be further supplemented by the cash bonus payout as per company declaration. Loan facility is also available for emergency needs.

Conclusion

Each type of savings plan has its own benefits and downsides. With a guaranteed plan, you know exactly what you’re getting back, and all payouts are assured. However, the rate of returns for guaranteed plans are generally lower than the interest rates offered by market-linked funds. On the other hand, since ULIPs are market-linked, you can expect high returns if the market performs well. But the inherent turbulence of the market also makes ULIPs a risker alternative for conservative investors.  

Finally, you can opt for participating plans that have both guaranteed and non-guaranteed elements. These plans are great for those who don’t want to invest in the market but still want greater returns compared to a fully guaranteed plan. However, the performance of par plans completely depends on the health and financial stability of your insurer. Edelweiss Life Insurance has had some of the best bonus declarations for the past decade, making them one of the top par plan providers in the insurance sector today.

 

Aastha Mestry - Portfolio Manager 

An Author and a Full-Time Portfolio Manager, Aastha has 6 years of experience working in the Insurance Industry with businesses globally. With a profound interest in traveling, Aastha also loves to blog in her free time.