Investment Plans 1008 views December 28, 2020

Why Should You Invest in Guaranteed Insurance Plans?

You would want your dependents to maintain their lifestyle even when you are not with them. The best way by which you can ensure the same is by putting your money in Life Insurance, which helps your dependents get a handsome amount in case you die during the policy term. Do you know several life insurance plans provide guaranteed payouts and maturity benefits along with protecting your life? Such plans are known as Guaranteed Income Insurance Plans, which can help secure yourself and your family financially.


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Simply put, Guaranteed Insurance Plans ensure a certain amount of money after some years. However, the payout quantum can vary from one insurance policy to another.  With the guaranteed returns from your policy, you can meet your different financial goals. One of the best things about this exclusive Insurance Product is the different bonuses that it comes with.

A Guaranteed Insurance product can be a perfect investment for customers who don’t want to take risks in their investment. You must be thinking about some other reasons to choose Guaranteed Insurance Plans. Well, in this post, we will discuss the same. So, don’t stop reading!

What are the Benefits of Guaranteed Insurance Plans?

Guaranteed Insurance Plans provide a wide range of benefits because of which you should invest in them, such as Financial Stability, Death Benefits, Maturity Benefits, Tax Benefits, Bonus Benefits, Rider Options, etc. We are discussing these reasons one after another. Let’s start with Death Benefits!

Death Benefits

People opt for a Life Insurance Plan to secure their family’s future if something unfortunate like a death happens. With a Guaranteed Insurance Plan, individuals can ensure that their families will not be forced to adjust their lifestyle in their absence. Upon your demise, the nominee (chosen at the inception of the policy) will receive death benefits. This benefit can be a lump sum amount or equal monthly installments over a fixed period. Some plans also provide a portion of the Sum Assured at the time of death as a lump sum amount and the remaining portion in installments over a period with the Income Benefit Option. This generally changes from one insurance plan to another, so you can choose according to your needs.

Survival or Maturity Benefit

With Guaranteed Insurance Plans, you can receive maturity benefits at the end of your policy term or premium payment term, depending on the plan chosen by you. This maturity benefit will include a simple reversionary bonus and terminal bonus (if any). The key to getting maturity benefits is to pay all your premiums without fail and ensuring your policy is in force at maturity. Else you won’t get the same.

Wondering what a Reversionary Bonus is? Well, it is a percentage of the Sum assured on your plan. Insurance Companies usually calculate this bonus annually and accumulate it at the end of each policy year. On the other hand, a terminal bonus is paid once in the policy term and only when the policy is in force for a long period.

Choose the Premium Payment Term According to your Convenience

With Guaranteed Insurance Plans, you can choose to pay the premium from three options – Single Pay, Regular Pay, and Limited Pay. With the Limited Pay Option, you will get a Limited Premium Payment term while you will be eligible to get coverage throughout your chosen policy term. With this feature, you can enjoy a longer policy coverage by paying the premiums for a limited period.

Tax Benefits

One more reason why you should invest in Guaranteed Insurance Plans is the tax benefits that they offer. Under Section 80C of the Income Tax Act, 1961, you can enjoy tax benefits every year of your policy term on the premium payment, while under Section 10(10D), you are eligible for tax exemptions on maturity proceeds.

Loan Against Policy

Once your Guaranteed Insurance Plan acquires a surrender value (usually, the time is 3 years), you can go for a loan against your policy to meet your personal needs. You will get the required loan amount up to a certain percentage of your surrender value that varies from one guaranteed insurance plan to another. You should check the condition mentioned in your policy before choosing it.

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