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Life insurance, sometimes used as a synonym for long term savings. If you had to view life insurance from another perspective, it is definitely a good avenue to save your hard-earned cash. Like the way one invests in stocks, mutual funds, small saving schemes, etc. one can also consider saving via 'insurance' route.

A number of insurance companies offer policies, which target specific needs. Endowment and money back policies are typical saving policies. In these 'saving' policies, the policyholder pays premium which is higher than the term policies since the premium, which is paid comes back to you in the form of survival or maturity amount. Each policy takes care of different needs of an individual.

If one had to look at insurance with a fresh perspective, it is a good provision to cover your risk as well as save your monies. Insurance policies comes in different form to suit your requirements perfectly. There are policies catering to, investment, children, retirement plans, etc. Insurance companies offer a host of policies that suits the needs defined by you. As a layperson, it may not be possible to understand the complete details and working of an insurance policy. In such a situation, an insurance advisor can step in to help you out in making appropriate decisions.

The paragraphs that follow below will sail you through the understanding of the insurance policies.

An insurance plan can be classified under two phases. Accumulation and Vesting phase. Accumulation Phase involves the phase during which the premium accumulation takes place, the second one being vesting wherein the actual payout of the money in the form of death/maturity amount is made to the nominee/policyholder.

As far as retirement policies are concerned, the investor has the option to defer the vesting age. On vesting, the policyholder either gets the accumulated money in a lumpsum or during specific chosen period.

Usually, when a policyholder buys an endowment policy, he/she looks at it from the cash value perspective wherein the policyholders analyse the 'returns' on their policy. The Life Insurance Corporation of India (LIC) offers a host of policies some of which are Bima Bachat, New Jeevan Suraksha, Jeevan Surabhi, Jeevan Anand, etc.

The benefits of having insurance polices are manifold. It helps you in taking a loan if you want. There are availability of riders that will help you customise your policies. Other benefits include early surrender option for medical reasons, bonus, loyalty additions, etc.

'Insurance' is an option that still needs to be explored. It's the ideal instrument that can be used to save an well as get a risk cover.