the price of your pure life cover is calculated by keeping in mind, among other things, how long an average person lives, what the gender is and at what age they are today. So now we know that the price of the pure risk cover should be the same across a term policy and an endowment policy. Now let’s look at the price of two similar cover plans. If the premium of Rs 1,000 a year buys a thirty-five-year-old person a life cover of Rs 5 lakhs for twenty-five years in a term plan, then the cost should be the same in the money-back plan of the life cover, right? This means that of the Rs 50,000 a
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