Detailed Analysis
The difference between term and whole life insurance is dramatic, and understanding it can save you lakhs.
Term insurance provides pure death benefit — if you die during the term, your family gets the sum assured. If you survive, you get nothing back (and that's a good thing). The low premiums mean you can afford adequate coverage (₹1-2 crore).
Whole life/ULIP/endowment plans bundle insurance with investment. The premiums are 5-10x higher, the coverage is inadequate, and the investment returns are poor (4-6% after charges). Agents push these because their commissions are 20-40% vs 5-10% for term plans.