The correct answer is: A. Unbundled plans.
Non-traditional products are also known as unbundled plans because they allow the policyholder to choose the specific components of the policy, such as the investment options, death benefit, and premium payments. This is in contrast to traditional products, which are typically bundled together and do not allow the policyholder to make these choices.
Unbundled plans offer a number of advantages over traditional products. First, they allow the policyholder to tailor the policy to their specific needs and goals. Second, they can be more affordable than traditional products, as the policyholder only pays for the components of the policy that they need. Third, they offer more flexibility, as the policyholder can make changes to the policy as their needs change.
However, unbundled plans also have some disadvantages. First, they can be more complex than traditional products, and it is important to understand the risks and potential rewards before purchasing one. Second, they may not be as well-regulated as traditional products, and there is a greater risk of fraud. Third, they may not be as liquid as traditional products, and it may be difficult to sell them if you need to access the cash.
Overall, unbundled plans can be a good option for people who want to have more control over their insurance policy. However, it is important to understand the risks and potential rewards before purchasing one.
Here is a brief explanation of each option:
- A. Unbundled plans: These plans allow the policyholder to choose the specific components of the policy, such as the investment options, death benefit, and premium payments.
- B. Bundled plans: These plans are typically sold as a package, and the policyholder does not have the option to choose the specific components of the policy.
- C. ULIP: A unit-linked insurance plan (ULIP) is a type of life insurance policy that combines life insurance with investment features.
- D. Annuity: An annuity is a contract between an individual and an insurance company that provides income for the individual in retirement.