While term insurance is one of the most affordable and straightforward forms of life insurance, there are other types of life insurance policies that offer additional benefits, such as savings and investment components. Understanding the key differences can help you choose the right insurance plan based on your financial needs and long-term goals.
Feature
|
Term Insurance
|
Whole Life Insurance
|
Endowment Plan
|
ULIP (Unit-Linked Insurance Plan)
|
Purpose
|
Pure life cover
|
Lifetime coverage
|
Life cover + savings
|
Life cover + investment
|
Premium Cost
|
Low
|
High
|
Moderate
|
High
|
Maturity Benefit
|
No (only death benefit)
|
Yes (sum assured + bonuses)
|
Yes (sum assured + bonuses)
|
Yes (market-linked returns)
|
Risk Factor
|
Low
|
Low
|
Low
|
Market risk involved
|
Best For
|
Income replacement, family protection
|
Lifelong coverage
|
Savings and financial security
|
Investment with insurance
|
Term insurance is ideal for individuals who need high coverage at a lower cost, ensuring financial protection for their family. On the other hand, whole life, endowment, and ULIP plans provide additional financial benefits, but at a higher premium. Choosing the right insurance policy depends on your financial objectives, affordability, and long-term security plans.