Whether the final payout in respect of ULIP is made to the policy holder or the person insured by the policy? - Anonymous
It is the policyholder who receives the maturity benefit. We'll explain.
In insurance, there can be three parties involved:
- The one who buys the policy (policyholder) and pays the premium,
- The insured (who is covered by the policy), and
- A nominee (who is designated to receive the benefits in case of the insured's demise).
In ULIP, all these parties can be different individuals.
Let's take a closer look at two scenarios:
- Case 1 - Policyholder is also the premium payer: Let's say a husband buys a ULIP policy (policyholder) and pays the premiums. His wife is the one who is insured and their son is the nominee.
Now if the policy runs its course, without any unfortunate incident, and matures, then the maturity benefit (sum insured and invested) is paid to the husband, who is the policyholder.
- Case 2 - Policyholder is not the premium payer: Taking the above example, but now the husband is not the one who pays the premiums but is still the policyholder. In this case, the maturity benefit will still be paid to the husband upon maturity of the policy.
However, the policyholder must ensure that all the policy documentation is accurate and the premiums are paid on time, in order to be eligible to get the maturity benefits of ULIPs.
Hired your bodyguard yet?
Say no to ULIPs
Have a different question in mind? Ask us