Having insurance is essential to protect oneself from unforeseen circumstances. There are various types of insurance policies available in the market today, and it can be overwhelming to choose the right one. One such policy is ric insurance.In this article, we will delve into the world of ric insurance, including its definition, benefits, coverage options, and FAQs. Let’s get started.
What is Ric Insurance?
Ric insurance stands for ‘return of investment capital insurance.’ It is a type of insurance policy that guarantees that an individual receives the full amount of their investment if they die before the investment reaches maturity. In simpler terms, if the investor passes away, their beneficiaries will receive the total invested amount, including the interest earned.
Ric insurance is a type of term life insurance policy, where the term is determined by the investment period. Upon maturity, the insurance company returns the total invested amount to the investor. It is an ideal investment for individuals who want to invest their money in a low-risk investment yet ensure that their beneficiaries receive the full amount in case of their untimely demise
Benefits of Ric Insurance
There are several benefits of investing in ric insurance:
Benefit |
Description |
Low-Risk Investment |
Ric insurance is a low-risk investment that guarantees a return on investment, which is ideal for individuals who do not want to take risks. |
Life Insurance |
Ric insurance provides life insurance coverage, ensuring that in case of an individual’s untimely demise, their beneficiaries receive the invested amount. |
Guaranteed Return on Investment |
Investors receive a guaranteed return on investment, which is the total invested amount, including interest earned. |
Who Should Invest in Ric Insurance?
Anyone who wants to invest their money in a low-risk investment and wants to ensure that their beneficiaries receive the total invested amount in case of their untimely demise should invest in ric insurance.
Individuals who have dependents and want to ensure that their dependents receive financial support in case of their demise can also invest in ric insurance.
Coverage Options of Ric Insurance
Ric insurance provides coverage for any investment made by an individual. The coverage options available are:
Single Premium
Under this option, the individual makes a lump-sum payment for the investment amount. The insurance company returns the invested amount and the interest earned upon maturity or in case of the investor’s demise, whichever is earlier.
Regular Premium
Under this option, the individual makes regular payments for a pre-determined period. The insurance company returns the invested amount and the interest earned upon maturity or in case of the investor’s demise, whichever is earlier.
FAQs on Ric Insurance
1. What is the minimum and maximum investment amount for ric insurance?
There is no minimum investment amount for ric insurance. The maximum investment amount is determined by the insurance company.
2. What is the investment period for ric insurance?
The investment period varies depending on the insurance company. It can range from a few years to several decades.
3. What happens if an individual cancels their ric insurance policy?
If an individual cancels their ric insurance policy, they will receive a surrender value, which is the total invested amount minus any administrative and cancellation charges, if applicable.
4. Is ric insurance taxable?
Yes, ric insurance is taxable under Section 10(10D) of the Income Tax Act, 1961. However, the maturity amount received by the beneficiaries is tax-free.
5. Can an individual avail of loans against their ric insurance policy?
No, an individual cannot avail of loans against their ric insurance policy.
Conclusion
Ric insurance is a low-risk investment that provides life insurance coverage and guarantees a return on investment. It is an ideal investment for individuals who want to ensure that their beneficiaries receive the total invested amount in case of their untimely demise. It is essential to understand the coverage options, benefits, and FAQs before investing in ric insurance to make an informed decision.
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