Best Guaranteed Return Plans And Their Benefits
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5 min read
Updated on Aug 09, 2023
We are well aware of the hardships of making money and thus try to continuously keep saving every bit of it to fulfil the needs of our loved ones. This is why investors and other job holders keep looking for options where there are either no or very low market risks.
The people who are risk-averse and want their capital to be in safe hands should consider investing in Guaranteed Return plans. These plans keep your money free from the ups and downs of the market, give you guaranteed returns including bonus amounts and keep your mind at peace.
If you wish to invest your hard-earned money in a risk-free and safe product, go through the following benefits of guaranteed returns insurance plans. It would help you in making an informed decision.
What’s Inside
- Guaranteed Returns
- Life Cover
- Build a Corpus
- Avail of Tax benefits
- Rider benefits
- Loan against the policy
- Aids in Retirement planning
- Flexible premium options
- Easy to buy
1. Guaranteed Returns
The investments made through the guaranteed returns insurance plans are free from market risks which is why you would not put your money at risk. You would be liable to get guaranteed returns in the form of the death benefit or maturity benefit. Apart from this you would also be eligible to earn additions and bonuses, that would further enhance the payout amount.
2. Life Cover
Guaranteed returns insurance plans offer you life coverage protection under which, your bereaved family would be liable to receive the death benefit in case you, the policyholder, lose your life. The death benefit payable to your family can help them to sustain their financial needs and continue to fulfil their dreams even when you are not with them.
3. Build a Corpus
The guaranteed returns insurance policies can be used in a planned way of investment to build a corpus and fulfill your long-term goals like buying a house, car, or starting a new business. When you reach the maturity phase of your plan, you are paid a guaranteed maturity benefit by the company that can be used to fund your dreams.
4. Avail of Tax benefits
Take a look at the tax benefits that you can avail of when saving in guaranteed returns insurance plans:
| Sections | Particulars | Total Tax Benefits |
| 80C | The premiums payable under guaranteed returns insurance plans are eligible for tax deductions. | Up to INR 1.5 lakhs |
| 80D | On opting for a health rider under a tax saving plan, the premiums payable are eligible for a tax deduction. |
INR 25,000 INR 50,000 (for senior citizens) |
| 10(10D) | The maturity benefit amount along with the bonuses shall be considered tax-free if the premiums paid were not more than 10% of the sum assured. | _ |
| Death Benefit | The death benefit paid to the beneficiary is always considered a tax-free amount. | _ |
5. Rider benefits
Rides are additional coverage offers that you can add to your base plan to make it more efficient. There are a variety of riders available under the guaranteed returns insurance plans to enhance the scope of your policy.
Some of the most popular options are:
- Accidental death and disablement benefit rider
- Critical illness rider
- Term rider
- Surgical benefit rider
- Terminal illness rider
- Surgical benefit rider
- Hospital cash rider
- Family income rider
- Premium waiver rider
Visual Stories by Mahindra Paybima
6. Loan against the policy
In case of a personal or business emergency, you can take a loan against the policy. This loan is issued upon the surrender value and the company allows you to withdraw an amount up to 90% of the surrender value. This feature of the guaranteed returns insurance plans can save you when you need financial help at any point in time.
7. Aids in Retirement planning
Investing in the guaranteed returns insurance plans will keep your money safe, offer wealth enhancements and pay guaranteed returns at the maturity period which will act as your retirement benefit. These plans give you higher returns on your savings which is why they are recommended as the best retirement and savings plans among all.
8. Flexible premium options
There are a lot of options available for you to choose as to how you would like to pay your premiums. You can either pay the entire amount at once, or for a limited period, or for the whole policy term. Premiums can be paid monthly, quarterly, half-yearly, or annually as per your convenience.
9. Easy to buy
A range of guaranteed returns insurance plans is available online, wherein you can compare them and choose your plan in just a few minutes. Also, there are no pre-medical tests that are required while purchasing these plans, making the purchase process quick and hassle-free.
Conclusion
It is necessary that you align your financial goals before investing in one of these plans so that you move accordingly to fulfil that goal in the end. Estimate the funds required for the plan and choose the sum assured, the policy tenure and the mode of payment from the available options. Do try to add some riders to enhance the value of your base plan. Apart from all these points, a comparison of plans and insurance companies is a must so that you get the best-suited plan for yourself.
Related Articles
- HDFC Life Guaranteed Income Insurance Plan
- Max Life Guaranteed Income Plan
- Bajaj Allianz Best Guaranteed Return Plan
- PayBima Khushi Ka Tohfa
- LIC Guaranteed Return Plans in India
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FAQs: Guaranteed Return Plans
What is a Guaranteed Return Plan (GRP)?
A Guaranteed Return Plan is an investment plan offered by insurance companies that guarantees a specific return on investment to policyholders. These plans are usually low-risk and provide a guaranteed return on the policyholder's premium.
How does a GRP work?
A Guaranteed Return Plan requires the policyholder to pay a premium to the insurance provider for a set length of time, which can range from 5 to 30 years. The policyholder receives a lump sum payment at the end of the term, which comprises the principle amount and the guaranteed interest rate.
What are the benefits of a GRP?
One of the primary advantages of a Guaranteed Return Plan is that it provides a guaranteed return on investment that is unaffected by market volatility or interest rate changes. Furthermore, these policies are low-risk and give financial protection to the policyholder and their family in the event of a calamitous catastrophe.
Are there any tax benefits of investing in a GRP?
Yes, policyholders who invest in a Guaranteed Return Plan are eligible for tax breaks. Premiums paid for these plans are tax deductible under Section 80C of the Income Tax Act, up to a maximum of Rs. 1.5 lakh per year.
What are the types of Guaranteed Return Plans available in the market?
Guaranteed Return Plans come in a variety of forms, including standard endowment plans, money-back policies, and pension plans. Each plan has its own set of features and advantages, and policyholders should select one that meets their financial objectives and needs.
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PayBima Team
PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.
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