Ajay and Priya are married and both of them earn 40,000 each. They earn total of 80,000 and their monthly expenses are around 20000-30000 per month. In case they have to opt for an Insurance plan. which one they should go for?a. Term Insuranceb. Endowment or Money back plansc. ULIPSd. No Need to take InsuranceChoose one option among these and give the reason.Your answer
Question
Ajay and Priya are married and both of them earn 40,000 each. They earn total of 80,000 and their monthly expenses are around 20000-30000 per month. In case they have to opt for an Insurance plan. which one they should go for?a. Term Insuranceb. Endowment or Money back plansc. ULIPSd. No Need to take InsuranceChoose one option among these and give the reason.Your answer
Solution
Ajay and Priya should opt for a. Term Insurance.
The reason for this is that term insurance provides a high coverage amount at a low premium rate. Given their income and expenses, they can easily afford the premium of term insurance. This type of insurance will provide financial security to their family in case of any unfortunate event.
Moreover, term insurance is purely an insurance product, unlike Endowment/Money back plans and ULIPS which combine insurance with investment. These plans have higher premiums and the returns on the investment component are often not very high.
As for the option of not taking any insurance, it is not advisable because insurance provides a safety net and ensures that Ajay and Priya's family will have financial support in case of any unforeseen circumstances.
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