Exit Intent Popup /Assets/Project/ABCL/images/close-button.svg

Get Guaranteed Returns After a Month^

Unlock the Power of Smart Investment!

*Min 3 characters
+91
*Please enter a valid 10 digit Mobile No.
Exit Intent Popup /Assets/Project/ABCL/images/close-button.svg
/Assets/Project/ABCL/images/Icon-Filled.svg

I agree to the Terms of Usage and Privacy Policy. By submitting my contact details here, I override my NDNC registration and authorize ABSLI to contact me by phone/e-mail/SMS/WhatsApp. Trade Logo "Aditya Birla Capital" displayed above is owned by ADITYA BIRLA MANAGEMENT CORPORATION PRIVATE LIMITED (Trademark Owner) and used by ADITYA BIRLA SUN LIFE INSURANCE COMPANY LIMITED (ABSLI) under the license. BEWARE OF SPURIOUS / FRAUD PHONE CALLS! IRDAI is not involved in activities like selling insurance policies, announcing bonus or investment of premiums. Public receiving such phone calls are requested to lodge a police complaint. ABSLI Nishchit Aayush is a non-linked non-participating individual savings life insurance plan (UIN No 109N137V05)

/Assets/Project/ABCL/images/Icon-Filled.svg

Thank you

for your details.

We will reach out to you shortly.

Lump Sum Meaning

3
Rated by 3 readers
What is a Lump Sum Benefit?
A lump sum benefit in an insurance policy refers to a payment method where the entire benefit amount is paid out in one single payment, rather than in periodic instalments. This benefit is typically paid out upon the occurrence of a specific event covered under the policy, such as the death of the insured in a life insurance policy, or the diagnosis of a critical illness in a critical illness policy.

Why is a Lump Sum Benefit Important?

The importance of a lump sum benefit can be understood from the following points:
  • Immediate Financial Assistance :

    A lump sum benefit provides immediate financial assistance to the policyholder or beneficiaries, helping to cover unexpected costs or financial obligations.

  • Flexibility :

    Unlike periodic payments, a lump sum benefit gives the recipients the flexibility to use the money as they see fit. They could use it to pay off debt, cover medical expenses, invest for future needs, or anything else.

  • Simplicity :

    Receiving a lump sum benefit can simplify financial planning, as the entire benefit amount is received at once.
However, it's worth noting that whether a lump sum benefit is the best option depends on the specific circumstances and needs of the policyholder or beneficiaries.

When is a Lump Sum Benefit Paid?

A lump sum benefit is typically paid out when a specific event covered under the insurance policy occurs. For example:
  • In a Life Insurance Policy :

    The lump sum death benefit is paid out upon the death of the insured.

  • In a Critical Illness Policy :

    The lump sum benefit is paid out upon the diagnosis of a covered critical illness.

  • In a Personal Accident Policy :

    A lump sum benefit may be paid out upon the occurrence of a covered accident resulting in disability or death.
The specific terms and conditions of the lump sum benefit payment would be outlined in the insurance policy document.

What are the Considerations for a Lump Sum Benefit?

While a lump sum benefit has its advantages, there are also important considerations:
  • Financial Management: Receiving a large sum of money all at once requires careful financial management. The recipients need to plan how to use the money wisely to meet their immediate needs and future financial goals.

  • Tax Implications: Depending on the type of insurance policy, the lump sum benefit may or may not be subject to taxes. It's advisable to consult with a tax advisor or financial planner to understand the potential tax implications.
In conclusion, a lump sum benefit is an important feature of many insurance policies that can provide significant financial support when it's most needed. However, it's essential to understand how it works and to consider your specific needs and circumstances when choosing an insurance policy.
How much helpful you found for you?
3
Rated by 3 readers
3 / 5 ( 3 reviews )
Not Helpful
Somewhat Helpful
Helpful
Good
Best

Thank you for your feedback

Don’t forgot to share helpful information in your circle

Newly Added Terms

Newly Added Terms on Insurance Dictionary

Most Appreciated Terms

Most appreciated Terms on Insurance Dictionary
Buy ABSLI Assured Savings Plan Online

Guaranteed income with Lumpsum benefit

Buy ABSLI Nishchit Aayush Plan now
BUY ONLINE

Thank you for your details. We will reach out to you shortly.

Thank you for your details. We will reach out to you shortly.

Buy ₹ 1 Cr Term Cover @Rs.492/month
for Salaried Individuals¹
*Min 3 characters
+91 phone
*Please enter a valid 10 digit Mobile No.
*This field is required.
Buy ₹1 Crore Term Cover @ @Rs.492/month for Salaried Individuals¹
ABSLI Salaried Term Plan
Exclusively For Salaried Individuals
4 Plan Options
Life Cover upto 70 years
Optional Accelerated Critical Illness benefit
Inbuilt Terminal Illness Benefit
Life Cover
₹1 crore
Premium:
₹492/month¹
  • Disclaimer

    ABSLI Salaried Term Plan (UIN:109N141V01) is a non-linked non-participating individual pure risk premium life insurance plan; upon Policyholder’s selection of Plan Option 2 (Life Cover with ROP) this product shall be a non-linked non-participating individual savings life insurance plan.
    1LI Age 21, Male, Non Smoker, Option 1: Life Cover, PPT: Regular Pay, SA: ₹ 1 Cr., PT: 10 years, Premium paying term: 10 years, Annual Premium: ₹ 5900/- ( which is ₹ 491.66/month) Premium exclusive of GST. On death, 1 Cr SA is paid and the policy terminates.
    ADV/9/23-24/1972