The correct answer is: B. Bundled plans.
Traditional cash value plans are also known as bundled plans because they combine life insurance with an investment component. This means that the policy holder pays a premium that is used to cover the cost of insurance and to invest in a variety of assets, such as stocks, bonds, and mutual funds. The investment component of the policy can grow over time, and the policy holder can borrow against the value of the policy or withdraw money from it.
Unbundled plans, on the other hand, do not include an investment component. Instead, the policy holder pays a premium that is used to cover the cost of insurance only. Annuity is a contract between an individual and an insurance company that provides income for the individual in retirement. ULIP is a type of life insurance policy that combines life insurance with investment options.
Here is a brief explanation of each option:
- Unbundled plans do not include an investment component. Instead, the policy holder pays a premium that is used to cover the cost of insurance only.
- Bundled plans combine life insurance with an investment component. This means that the policy holder pays a premium that is used to cover the cost of insurance and to invest in a variety of assets, such as stocks, bonds, and mutual funds.
- Annuity is a contract between an individual and an insurance company that provides income for the individual in retirement.
- ULIP is a type of life insurance policy that combines life insurance with investment options.