Feroze Azeez, Anand Rathi Wealth Management in an interview to CNBC-TV18 tells us why one can also look at convertible insurance policy
Excerpts of his interview.
Q: What is convertible insurance policy?A: Firstly there are two types of insurance policies in the category where you cover your life - one is a term plan, the other one is a whole life plan. A term plan insures you for a specific time period, but a whole life plan insures you for the entire life.
Convertible insurance policy would be one which has the flexibility over a period to convert from a term plan to a whole life plan, the one in which after 4-5 years you have the discretion to convert it from a term plan to a convertible plan. So that is basically a convertible plan which jumps from one end to the other.
These are more expensive than a term plan, but they are relatively cheaper than a whole life plan and they will give you the flexibility to ensure that you can defer your decision of changing between the plans at a later date. That would be a convertible insurance policy.
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