So, the rate of return on investments in life insurance policies is also declining. Barring some exceptions, none of the insurers is assuring guaranteed rates of bonus. LIC is also discontinuing its guaranteed bonus insurance plans one after another.
Interestingly, the interest rate on public provident fund (PPF) has been declining slower than the fall in bonus rates on insurance policies.
The investor will now find the combination of a term insurance policy (for risk cover) and PPF (as an investment) as a better option for both insurance and risk cover, than investing in high premium
