Home > Money > Question
Need Expert Advice?Our Gurus Can Help
Sanjib

Sanjib Jha  |66 Answers  |Ask -

Insurance Expert - Answered on Feb 02, 2023

Sanjib Jha is the CEO of Coverfox Insurance. His expertise includes health and auto insurance. He has over 22 years of experience in the financial sector. He has completed his post-graduation from the Institute of Company Secretaries of India.... more
Prasanna Question by Prasanna on Jan 25, 2023Hindi
Listen
Money

Hi Sanjib. Why is a term insurance considered better than insurance that comes with annuities and bonus?

Ans: Hi Prasanna, life insurance protects your family in case of an unfortunate demise of the policy holder. In case of a premature death, while in case of annuity plans, it protects your income if you live longer than the expected term.
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
Money

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |8192 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Aug 19, 2024

Asked by Anonymous - Aug 16, 2024Hindi
Listen
Money
what about term insurance with investment policy ?
Ans: Mixing insurance with investment may seem convenient, but it’s often not the best approach. It’s crucial to understand the distinction between these two financial needs: protection and growth.

Why You Shouldn't Mix Insurance with Investment
1. High Costs: Insurance-cum-investment policies, such as endowment plans or ULIPs, often come with higher premiums. A significant portion of these premiums goes towards administration charges, commissions, and mortality charges, leaving less for actual investment.

2. Low Returns: The investment component in these policies typically provides lower returns compared to other investment avenues. This is because the funds are often invested in conservative instruments with limited growth potential.

3. Complicated Structure: These policies can be complex, making it difficult to understand the real value of your investment. The returns are not always transparent, and the surrender value is often much lower if you decide to exit early.

The Better Approach: Keep Insurance and Investment Separate
**1. Term Insurance for Protection:

Affordable Coverage: A pure term insurance plan offers a high sum assured at a relatively low premium. This ensures your family is financially protected in case of an untimely event.
No Investment Element: Since there’s no investment component, the entire premium goes towards providing life cover, making it a cost-effective option.
**2. Invest Separately Based on Risk Appetite:

Risk-Averse Investors: If you are cautious and prefer guaranteed returns, investing in Public Provident Fund (PPF) is a safe and tax-efficient option. It offers a stable return with the benefit of EEE (Exempt-Exempt-Exempt) tax status.
Comfortable with Risk: For those comfortable with market risks, investing in mutual funds is a better option. Equity mutual funds, in particular, have the potential to generate higher returns over the long term, which can significantly grow your wealth.
Final Insights
Combining insurance with investment usually doesn’t serve either purpose effectively. Instead, opt for a pure term insurance plan for protection and invest separately based on your risk tolerance. This strategy ensures you get the best coverage for your family while maximizing your investment returns, whether through safe instruments like PPF or higher-risk options like mutual funds.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |8192 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Feb 01, 2025

Listen
Money
What's the difference between term and permanent life insurance?
Ans: Difference Between Term and Permanent Life Insurance
Life insurance is important for financial security. It helps protect loved ones in case of an untimely demise. There are two main types: Term Life Insurance and Permanent Life Insurance.

Both serve different purposes. Let’s analyse their features, benefits, and suitability.

Definition and Purpose
Term Life Insurance offers coverage for a fixed period. If the policyholder passes away within this period, the nominee gets the sum assured.
Permanent Life Insurance provides coverage for the entire lifetime. It also has an investment or savings component.
Cost and Affordability
Term insurance is much cheaper. It provides only pure life cover.
Permanent insurance is costly. It includes life cover and an investment component.
For those looking for maximum coverage at a lower cost, term insurance is better.

Premium Structure
Term insurance has fixed and affordable premiums. Premiums remain constant throughout the policy term.
Permanent insurance has high premiums. A part of it goes towards building cash value.
If the goal is cost efficiency, term insurance is the preferred choice.

Maturity Benefits
Term insurance has no maturity benefit. If the insured survives the term, there is no payout.
Permanent insurance builds cash value. This can be withdrawn or borrowed against.
Those looking for pure protection should opt for term insurance.

Investment Component
Term insurance does not have an investment feature. It is purely for protection.
Permanent insurance acts like an investment. It grows in value over time.
However, returns on permanent insurance are often lower than other investments.

Flexibility in Coverage
Term insurance allows coverage for a specific term, such as 10, 20, or 30 years.
Permanent insurance covers the insured for life.
For those wanting lifelong coverage, permanent insurance is an option.

Liquidity and Borrowing Facility
Term insurance has no cash value. It cannot be used for loans.
Permanent insurance builds cash value. This can be borrowed against if needed.
However, borrowing reduces the final payout to nominees.

Returns on Investment
Term insurance provides no returns. It only offers financial security.
Permanent insurance gives returns, but they are lower than mutual funds.
Instead of permanent insurance, investing in mutual funds can provide better growth.

Tax Benefits
Term insurance premiums qualify for tax deductions under Section 80C.
Permanent insurance also qualifies for 80C deductions. Additionally, the maturity amount is tax-free under Section 10(10D).
Both options offer tax benefits. However, term insurance is more cost-effective.

Who Should Choose Term Insurance?
Individuals looking for high coverage at a low premium.
Young professionals with dependents.
Those who prefer separate investment and insurance planning.
For most people, term insurance is the best choice.

Who Should Choose Permanent Insurance?
Individuals looking for lifelong coverage.
Those who need a cash-value component.
People who want a forced savings mechanism.
However, better investment options exist outside of permanent insurance.

Common Myths About Life Insurance
"Term insurance is a waste of money."
Reality: It provides financial security at an affordable cost.
"Permanent insurance gives better returns."
Reality: Mutual funds and other investments usually offer higher returns.
"Investing in insurance is smart."
Reality: Insurance should be for protection, not wealth creation.
Final Insights
Term insurance is affordable and effective for protection.
Permanent insurance is expensive and offers lower returns.
For financial growth, separate investment in mutual funds is better.
It is best to consult a Certified Financial Planner for personalised advice.
Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

..Read more

Latest Questions
Dr Nagarajan Jsk

Dr Nagarajan Jsk   |314 Answers  |Ask -

NEET, Medical, Pharmacy Careers - Answered on Apr 06, 2025

Asked by Anonymous - Apr 03, 2025Hindi
Career
Hello sir, Saranya from chennai. Doing final year B pharm. Heard about gpat from my friends How to do this entrance exam for joining pg course Please tell me if any other entrance exam is there for pg
Ans: Hi Saranya,

As you mentioned, many pharmacy graduates are considering the GPAT after completing their undergraduate studies in pharmacy. However, there are several more options available for pursuing a postgraduate degree in pharmacy today.

Here are the options for pursuing a PG in pharmacy:

1. GPAT: You can appear for the GPAT exam, and if you qualify, you will be eligible for a scholarship.

2. NIPER: You can also take the entrance exam for NIPER (National Institute of Pharmaceutical Education and Research) campuses, which include Ahmedabad, Guwahati, Hajipur, Hyderabad, Kolkata, Raebareli, and Mohali. Qualifying here also makes you eligible for a scholarship.

3. PG-CUET: A new option is the PG-CUET (Common University Entrance Test), which is being conducted by the NTA (National Testing Agency) under the Department of Higher Education.

4. Government Institutions: State governments will announce admission through advertisements. Admission will be based on marks or an entrance exam.

5. Deemed Universities: Some deemed universities offer admission through their own entrance exams.

Historically, GPAT and NIPER were the primary options for national-level aspirants. Starting from the academic year 2025-26, the NTA will also conduct the PG-CUET for national-level admissions.

I have included more details about the PG-CUET below.
PGCUET (CODE - SCQP23)
The Common University Entrance Test (CUET) is a National level Test conducted for admission into PG programmes in Central, State, and Participating Universities/ Institutions. The Common University Entrance Test CUET (PG) will provide a common platform and equal opportunity to candidates across the country, especially those from rural and other remote areas, and help establish better connections with the Universities. A single application form will enable the Candidates to cover a wide outreach and be part of the admission process to various Central and participating Universities. NTA has been assigned the responsibility of conducting the Common University Entrance Test (CUET).

Under Participating universities/instituttions are: Central and State Universities, Deemed and Private universities and Government institutuions.

Candidate must only select the test paper code. As the list of universities is dynamic and keeps on changing during the registration period.

A candidate can apply for two (02) Test Papers by paying the application fee (details mentioned at point 18).

A candidate can further apply for (02) additional Test Papers by paying additional application fees as applicable and maximum of four (04) test paper codes can be selected.

Mode of exam is CBT (Computer Based Test).
All Question Papers will be MCQ type. • Candidates can choose a maximum of four question paper codes. • The comprehension section in the General Paper will be available in either English or Hindi, based on the candidate's preference indicated during registration. • The duration of the Exam would be 90 Minutes. • The Question paper will have 75 Questions. • Four marks will be awarded for each correct answer and one mark will be deducted for each wrong answer.
• Language papers will be in the concerned language only.
• M.Tech/Higher Sciences will be in English only.
•Acharya papers will be in Sanskrit except for Hindu Studies, Indian Knowledge System, and Baudha Darshan.
• Humanities, Sciences, and Common papers would be bilingual (English and Hindi).
• The examination would be conducted in 2-3 shifts.
• The English version of the questions in all the question papers except languages and Acharya will be taken as final.

Syllabus: The Examination Syllabus will be uploaded on the Exam.

For the current year the examination dates (13.03.2025 to 31.03.2025) got over. iI THINK YOU HAVE MISSED IT. DONT WORRY. NEXT YEAR YOU CAN TRY OR YOU CAN ASSIST YOUR JUNIORS.

ADMISSION: Admissions will be handled at the level of each of the participating Universities for their respective programmes. After the declaration of the CUET(PG) 2025 results, the respective Universities will declare the counselling/admission schedule and merit list based on the CUET (PG) - 2025 score and any other criteria of participating universities. Please see the website of the concerned university for details regarding admission. There may be admission counselling by the universities with additional fees.

Applicants as per eligibility can apply for multiple test paper codes in one registration form. Candidates should not apply through duplicate or multiple forms, which may lead to the cancellation of all his/her Application Forms

CODE FOR PHARMACY: SCQP-23
SYLLABUS [POC, PIC, MATHS, OC - II, MICRO, APH (I&II), PHARM ENGINEERING, DCH PHARMACY, PHARM ANALYSIS (I -IV ), COGNOSY, CEUTICS-II, BIOCHEM, JURIS, COSMETICS, PHARM TECH, MED CHEM I-III, PHARMACOLOGY I-IV, BIOTECH, DRUG DESIGN, MARKETING, FOOD SCIENCE, QA, MANAGEMENT] HAS SHARED IN NTA WEBSITE.

THIS YEAR 57 INSTITUTIONS PARTICIPATED FOR THE SAID PURPOSE. NEXT YEAR THIS MAY INCREASE.

THE ADVANTAGES ARE NOT ONLY CAN PURSUE PHARMACY, APART FROM PHARMACY, YOU CAN PURSUE - DATA SCIENCE & AI, PUBLIC HEALTH, BIOINFORMATICS, PACKAGING TECH, ENVIRONMENTAL MANAGEMENT, GEOSPATIAL SCIENCE, PG DIP IN AI DIGITAL IMAGING, HEALTH CARE DATA, GEOINFORMATICS, PB-PHARMD, M.PHARM-PV, MSc- MICRO, MSc-NUTRITION, DIETICS.

I believe this information will be beneficial for your future education.

POOCHO. LIFE CHANGE KARO!

...Read more

Dr Nagarajan Jsk

Dr Nagarajan Jsk   |314 Answers  |Ask -

NEET, Medical, Pharmacy Careers - Answered on Apr 06, 2025

Asked by Anonymous - Mar 09, 2025Hindi
Listen
Career
I am a 12th student now in state board of tamil Nadu and I am a government school student what is the minimum requirement for me to join mbbs in AFMC medical College
Ans: The following requirements are mandatory for admission to AFMC.

Age: 17-24yrs
Academic qualitfication: FIRST ATTEMPT with English, Physics, Chemistry and Biology/ Bio-technology taken simultaneously and securing not less than 60% of the aggregate marks in these three science subjects taken together and not less than 50% marks in English and 50% marks in each of the science subjects. They must have also passed an examination in Mathematics of the tenth standard.
Candidates seeking admission for MBBS course at AFMC Pune will have to mandatorily qualify the NEET UG 2024 Examination conducted by National Testing Agency (NTA). 11. Eligible candidates who are interested to join AFMC, Pune to pursue the MBBS course will have to mandatorily register and apply for AFMC, Pune on DGHS

The shortlisted candidates will be called for screening which comprises of Test of English Language and Reasoning (ToELR), Psychological Assessment Test (PAT), Interview and Medical Examination at AFMC, Pune.

ToELR & PAT - Test of English Language and Reasoning (ToELR) in the form of Computer Based Test (CBT) and also Psychological Assessment Test (PAT) to be conducted at AFMC, Pune only for candidates shortlisted for interview. (t) Written Examination Score - Score obtained in NEET (UG) 2024 (720 marks) added to ToELR Score (80 marks) divided by 4 to get a score out of 200. (u) Final Score - Written examination score (200 marks) + Interview marks (50 marks).

MEDICAL FITNESS: MANDATORY AS PER AFMC

ALL THE BEST

POOCHO. LIFE CHANGE KARO!

...Read more

Radheshyam

Radheshyam Zanwar  |1519 Answers  |Ask -

MHT-CET, IIT-JEE, NEET-UG Expert - Answered on Apr 06, 2025

Dr Dipankar

Dr Dipankar Dutta  |1093 Answers  |Ask -

Tech Careers and Skill Development Expert - Answered on Apr 05, 2025

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

Close  

You haven't logged in yet. To ask a question, Please Log in below
Login

A verification OTP will be sent to this
Mobile Number / Email

Enter OTP
A 6 digit code has been sent to

Resend OTP in120seconds

Dear User, You have not registered yet. Please register by filling the fields below to get expert answers from our Gurus
Sign up

By signing up, you agree to our
Terms & Conditions and Privacy Policy

Already have an account?

Enter OTP
A 6 digit code has been sent to Mobile

Resend OTP in120seconds

x