Term Insurance
It is a type of life insurance policy that provides coverage for a certain period of time, or a specified “term” of years. If the insured dies during the time period specified in the policy and the policy is active – or in force – then a death benefit will be paid. If the policyholder survives the term, the risk cover comes to an end.
Term insurance is less expensive when compared to other life insurance policies. No surrender, loan or paid-up values are granted under these policies because reserves are not accumulated.

Money Back Plans
Money back plans offer dual benefits of insurance and redemption of money at regular intervals. These policies rank high on the popularity chart.
They fit perfectly in the scheme of things of traditional investors who seek financial instruments that provide insurance and investment, with a low risk element and guaranteed returns.
In short money back plans are meant for individuals who require money at certain intervals in teir lifetime to meet fixed long and short-term financial needs (buying a house or car, vacations abroad).

Pension Plans
A pension is an arrangement to provide people with an income when they are no longer earning a regular income from employment. These plans provide financial stability during your old age.
Pension plans are most suited for senior citizens planning for a financially secure future. They enable you to lead a similar lifestyle as led during your employment days.

Endownment Plans
Endownment policies cover the risk for a specified period of time at the end of which, the sum assured is paid back to the policyholder along with the entire bonus accumulated during the term of the policy.
These policies offer you an endownment – representing a return on your premium payments payable to you in your own lifetime when the policy comes to an end.
Premium on endownment policies are usually payable for the full term of the endownment policy unless, of course, death were to take place earlier.

Saving Linked Plans
The people working in the metropolitan cities, occupied as they are in their day-to-day activities where inflation is inevitable, find difficult to provide adequate security for their families, Individual insurance with high premium in fact does not provide adequate insurance protection. Their need for insurance protection during service coupled with adequate savings for carefree retired life remains unfulfilled. Keeping this in mind, insurance companies have come out with attractive insurance schemes viz. Group Saving Linked Insurance scheme at a very low cost. Central Government has a similar scheme with minor modification, Semi-Government Organization, Public Sector Organizations and also Large private business houses and industrial enterprises have introduced this scheme, the salient features of which are as under:

• Protection at low cost without individual evidence of heath.
• Attractive returns on savings to meet post retirement needs.
• Simple procedures for granting life cover to large groups under one umbrella.
a) The Scheme can be introduced by employers provided certain percentage of employees is willing to join the scheme.
b) For the new entrants to the Company, the membership of the Scheme is compulsory.
It is decided on the basis of Group size and the occupation of the group. Premium has two components i.e. Risk Premium and Savings premiums, Premium risk Premium is utilized to offer life cover and Savings Premium is accumulated in members account.
Accident Benefit:
Double accident benefit can be allowed to the extent of the Sum assured for extra Premium.
The present rate of interest allowed on saving portion of premium is 8% compounding yearly.
Any employee irrespective of his present state of health is eligible to join the scheme subject to certain conditions. The only insurability condition is that the employee should not be absent on medical ground on the date of commencement of the scheme. All employees who have not crossed the retirement age are eligible to join the scheme. All future employees have to join the scheme compulsorily.
Tax Benefits:
Employees’ total contribution, savings as well as risk premium is entitled for income-tax rebate under Sec SoC of the Income Tax Act. The entire claim amount including interest earned payable on retirement or leaving service or on death is free from income-tax. The premium paid by the employer towards insurance cover is treated a s business expenses.


EDLI stands for Employees Deposit Linked Insurance (India Death payment Scheme)
All employees to whom the Employee’s Provident Fund and Miscellaneous Provision Act, 1952 applies, have a Statutory liability to subscribe to Employee’s Deposit Linked Insurance scheme, 1976 to provide for the benefit of Life insurance to all their employees.
Under the scheme as amended with effect from 24th June, 2000 the insurance benefit is equal to the average balance to the credit of the deceased employee in the Provident Fund during the last 12 months, provided that where such balance exceeds Rs 35,000, insurance cover would be equal to Rs 35,000 plus 25% of the amount in excess of Rs 35,000 subject to a maximum of Rs 60,000. Thus if the length of service is not adequate and/ or the salary is low the average balance may be substantially less and such the benefit to the employee’s family is either inadequate or non-existent.
The contribution @0.50% of each employee’s salary is payable by the Employer to the Provident Fund Authorities.

Gratuity Schemes
Gratuity refers to the emoluments received by an employee from his employer in gratitude for the services rendered. It is an amount given to employees by employer when they leave the job after completing five years or minimum 240 days per year or after retirement. The number of years may differ from company to company.
Gratuity is payable under the payment of wages act. Gratuity shall be payable to an employee on the termination of his employment after he has rendered continuous service for not less than five years.
a) On his superannuation, or
b) On his retirement or resignation, or
c) On his death or disablement due to accident or disease.

Leave Encashment
Many employers are providing Leave Encashment benefit in addition to other retirement benefits to their employees which is a lumpsum amount payable to the employees or their dependants on retirement, death, disablement, voluntary retirement etc.
End-of -the-year leave encashment facility available to employees, can be a huge liability to the company. So can be Medical Leave Encashment, if provided for. To meet this need of entrepreneurs and businesses. Both public sector and private insurance company has introduced Group Leave Encashment Scheme. Just pay a yearly premium, fund your leave encashment liability and let insurance company take care of your worries.
Nature of liability:
The amount depends upon the leave to the credit of the employee and his/ her salary at the time of exit. Liability is of increasing nature as it is linked with salary as well as leave position.
Group Leave Encashment Schemes (GLES) of insurers helps the employers in funding of their leave encashment liability. The salient features of the scheme are as follows:-
1. The Company will submit the employees’ data and rules for Leave Encashment. Insurer will make actuarial valuation and find out the funding requirements which shall be quoted to the company. The company will contribute as per the advice of Insurer.
2. A uniform life cover per employee or graded cover will be provided under One Year Renewable Group Term Assurance Plan of Insurance Co. A small term insurance premium will be charged in entitled to the amount of Insurance Cover, which will be tax-free.
3. The insurance company will do the Actuarial Valuation and will provide necessary certificate as per AS-15.
The amount of Term insurance Premium paid for Life Insurance Cover will be treated as business expenses.

Superannuation Schemes
It is a voluntary scheme for the purpose of tax planning. Company contributes up to 15% of basic wages which Is an allowable expense in the hands of employer and tax free receipt in the hands of employees. Employee does not contribute to this scheme.
The funds thus accumulated can be invested in house or can be invested with LIC who acts as a custodian of the fund. If the funds are invested in house, then the fund is created under an irrevocable trust recognized under the Income Tax Act, 1961.
A mandatory service clause varying from 1 to 10 years is put in by employers.

Key Man Insurance
An insurance policy taken out on the life of an executive or a senior employee of an organization whose death would cause significant loss to the organization. The liability is the estimated cost of the loss (in business lost, and replacement of the individual)
In the event of death, proceeds of the policy would be payable to the organization which took out the policy.

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