Investment Plans 1220 views September 2, 2020

IRDA Proposed Index Linked Life Insurance Plans

There are many individuals who prefer ULIP Plans known as Unit Linked Insurance Plan for covering their life. Their sum of money is invested into the market and depending upon the market fluctuations the company pays you the benefits. But now IRDA proposed Index Linked Life Insurance Plan in which your premium amount is invested into the government bonds and equity indices like Sensex or Nifty. This plan has low risk as compared to the Unit Linked Plans. On the other hand, this plan will give you a minimum return and there is no chance of any loss. It is just a proposal from IRDA and there is no such plan in the market right now. You can explore the features of this Plan.


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Features of Index-Linked Insurance Plan

  1. According to the Regulations of IRDA it doesn’t permit the insurers to sell the index-linked products.
  2. A working group is constituted to examine the various aspects of Index-Linked Products in the Life Insurance Segment.
  3. The return of the Index-Linked Life Insurance Plans will be benchmarked that allows the insured to get a guaranteed value.
  4. This plan will be offered as a pension plan product.
  5. It is an unbundled product and you can take it with any other financial product.
  6. You can link the Index-Linked Life Insurance Plans to 10 Years Government Bonds and indices like Sensex or Nifty.
  7. Index-Linked Life Insurance Plans are less risky than ULIP plans.

Duties of the Working Group

  1. They examine the need for index-linked products in India.
  2. The working group will tell the index-linked products available for sale.
  3. They study practices of jurisdictions related to the Index-Linked Product.
  4. They provide recommendations related to product structure and pricing.
  5. The working group will invite external experts for meeting as per the needs.
  6. The working group will submit the reports within 2 months from the date of the order.

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