Investing in F
products to secure the future is an important money goal. It will help you live at peace by managing any difficult circumstances. And there are many ways to do it. Apart from the regular savings and investment solutions, there are guaranteed return insurance plans offered by the insurance providers in India. The guaranteed return insurance plans in India have been gaining popularity in the recent past for many reasons. Let us discuss some of the most important ones here.
Why are Guaranteed Returns Plans Gaining Popularity?
Here is why guaranteed returns plans are gaining popularity:
- A guaranteed return with life cover – Investing in life insurance is a priority for people with many family financial commitments. And so, saving funds for achieving personal money goals becomes difficult. Investing in a guaranteed return policy offers dual benefits. Your family will get the death benefit in case of your unexpected demise, and you will get a guaranteed return when the plan matures.
As the returns are guaranteed during policy inception, you can decide on the extent of funds required as a guaranteed return based on your financial goals and invest accordingly. Therefore, it is gaining importance among the larger population.
- Flexibility – A guaranteed return insurance plan offers great flexibility to customise the policy features to your advantage. For instance, you can pay the premium for the guaranteed return plan monthly, quarterly, semi-annually, or annually and receive the payout as a lump sum, regular income for a fixed term, or as a combination of both options. The regular income option is popular among people planning for their retirement.
- Tax advantage – Like any other life insurance plan, the premium amount paid for the investment in a guaranteed return life insurance plan qualifies for a tax deduction under Section 80C. And the payouts qualify for a tax exemption under Section 10(10D) of the Income Tax Act, 1961. It is a striking advantage that has popularised its investment among the people today. However, the tax benefits are subject to certain terms and conditions. Therefore, it is important to read and understand the provisions before investing.
- Safety – Investments in financial securities offer greater returns in the long term. However, it contains a market risk that is highly unlikely to be predicted. Guaranteed return insurance plans are extremely secure as the returns are not market-linked. It is a great option for conservative investors.
- Higher returns – The guaranteed return policy offers higher returns than traditional savings plans such as the fixed deposit. And that is one main reason for its popularity among the people today. The returns will be based on your premium policy term and the sum assured. Therefore, if you have decided to invest in the guaranteed return plan, choose to purchase it early to invest long term, thereby reducing the premium rate and increasing the returns.
- Long term investment benefit – One another reason for its gaining popularity is that you can invest in a guaranteed return policy for a long period, such as between 10 to 40 years, based on the choice of plan. The longer you invest, the higher the returns. When you start investing early, you will get into the discipline of saving money regularly at a younger age when your commitments are less.
It will help you accumulate a huge fund during the longer policy tenure. Insurers also offer the option to purchase a savings insurance plan through the online platform. For example, you can purchase the Tata AIA life insurance plan online by comparing different product quotes, calculating the premium and identifying the best solution.
A guaranteed return insurance plan is a comprehensive life insurance plan gaining popularity due to its increased benefits. It offers a life cover and a guaranteed savings benefit. It is a safer platform to receive higher returns, provides a tax advantage and offers flexible features to modify it all for customising the product to maximise the financial security and savings benefits. You can start investing in the insurance policy with guaranteed returns early in life to choose a longer policy term and stay invested to reap higher returns while ensuring your family’s financial security anytime.