Guaranteed Income Plan
  • Is Guaranteed Income Plan the Right Choice For You?
  • Benefits of Guaranteed Insurance Plans
  • Best Guaranteed Income Plans Available

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Guaranteed Income Plan

It takes constant effort and perseverance to meet up all short and long-term financial goals at the right time. Although needs are endless, yet your financial strength can count for everything.

Hence, it is very important for an individual to maintain financial stability at every stage of life to ensure the financial security of his/her loved ones even when (s)he is not around them. Understanding the importance of financial stability, insurance companies offer guaranteed income plans.

The guarantee word is itself very fascinating, and being added to regular payouts, these plans become leverage for risk-averse investors. These plans provide dual benefits, including life insurance along with maturity benefits and guaranteed earnings in the form of yearly, monthly, or quarterly payouts decided by the policyholder at the time of purchasing the policy.

So if you buy a guaranteed income plan, you are liable to get guaranteed periodic payouts after the maturity of the policy. The amount of the payouts depends on the mentioned percentage of your main corpus (i.e. sum assured).

Who Should Go For Guaranteed Income Plans?

If you are a person who wishes to build up a significant corpus or source of regular income in your old age, then this plan is ideal for you. Any individual who falls in the age group of 18-60 years (this may change as per the respective plan) can buy a guaranteed income plan and enjoy all the benefits that come with the plan. In general, the policy term ranges from 10 to 30 years, and it is not dependent on the market’s performance.

What Benefits Do You Get From Guaranteed Insurance Plans?

Guaranteed Income Benefits
  • Maturity Benefit: Upon maturity, you will receive a simple reversionary benefit and start getting periodic payouts depending on the pre-decided percentage of sum assured of your plan.
  • Death Benefit: In case you don’t survive the premium payment term, the nominee is liable to get the basic sum assured along with bonuses like a reversionary and terminal bonus (if any). Moreover, the periodic payouts will be given to him/her for the fixed number of years, mentioned in your policy. Or, If you die during the payout period, then the sum assured and bonuses are credited to the nominee’s bank account.
  • Income Tax Benefit: The guaranteed income plan offers a tax deduction (every year) for payable premiums under section 80 C and tax exemption on the maturity proceeds under section 10 D of the Income Tax Act, 1961.

List of Some Best Guaranteed Income Plans

  1. Max Life Guaranteed Monthly Plan

    It is a money-back insurance plan, which offers a life cover with guaranteed regular income benefit for a payout period of ten years.

    Age at entry 25-60 years
    Maximum maturity age 66 years
    Premium payment mode Annually
    Policy term 6 years or 12 years
    Minimum annualized premium for a 6-year policy term Rs. 75, 000
    Minimum annualized premium for a 12-year policy term Rs. 20, 000
    Maximum annualized premium for both 6 and 12 years policy term No limit

    Benefits

    • On completing the premium payment term, the policyholder will receive guaranteed monthly income for the next 10 years.
    • After completing half of the 10-year payout period, the policyholder will get double monthly income.
    • In case of death of the policyholder, the nominee will get the lump sum.
    • The policyholder is free to modify his/her monthly guaranteed income plan after maturity and convert his/her monthly payouts into a lump sum payout.
  2. LIC New Jeevan Anand Plan

    It is a participating non-linked endowment assurance plan in LIC offering insurance coverage and risk-free saving under one roof.

    Age at entry 18 - 50 years
    Maximum maturity age 75 years
    Premium payment mode Yearly, Half-yearly, quarterly, monthly
    Policy term 15 - 35 years
    Premium amount Depends on the age of the policyholder, sum assured and term
    Loan facility against the policy After three years
    Minimum sum assured Rs. 1 lakh
    Maximum sum assured No limit

    Benefits

    • After completing the policy tenure, the policyholder will receive a basic sum assured along with bonuses.
    • In the case of demise of the policyholder, the sum assured (either 125% of the sum assured chosen by the holder or 10 times the annual premium) is payable to the nominee along with bonuses. (Note: A minimum death benefit of 105% of total premiums paid is payable to the nominee on death of policyholder)
    • Under this guaranteed income plan, the policyholder can avail rebates as follows -
    Mode of premium payment Rate of rebate
    Yearly 2%
    Half-yearly 1%
    Quarterly or monthly No rebate
    Amount of sum assured Rate of rebate
    INR 2,00,000 to 4,95,000 1.50% of the sum assured
    INR 5,00,000 to 9,95,000 2.50% of the sum assured
    INR 10,00,000 and above 3.00% of the sum assured
  3. Canara Smart Monthly Income Plan

    It is one of the ideal plans to meet your financial goals through guaranteed income and bonuses, offered by Canara HSBC and OBC.

    Premium Payment term 15 years
    Age at entry 18 - 55 years
    Maximum maturity age 43-80 years
    Premium payment mode Yearly and monthly
    Policy term 25 years
    Premium amount Depends on the age of the policyholder, premium mode and income chosen
    Sum assured 100 times the chosen monthly income
    Minimum income Rs. 2,000 per month (thereafter in multiples of 100)

    Benefits

    • This monthly guaranteed income plan offers monthly payouts to the policyholder for 15 years from the end of the 121st policy month.
    • After the maturity of the plan, the policyholder will receive added annual bonuses and final bonus, expressed as a percentage of the sum assured.
    • On choosing a higher sum assured, the policyholder can avail good discounts on the premium amount.
  4. SBI Life Smart Money Back Gold Plan

    SBI offers this participating non-linked money-back plan to support your financial needs at crucial points in your life.

    Minimum age at entry 14 years
    Maximum age at entry 45 years (for regular premium), 55 years (for limited and single premium)
    Maximum maturity age 70 years
    Premium payment option Regular premium/Limited premium/ Single premium

    Benefits

    • At the maturity of the plan, the policyholder will receive a final instalment of survival benefit along with bonuses like simple reversionary and terminal bonus, if any.
    • In case of the unfortunate demise of a policyholder, the nominee will receive either A or B, whichever is higher.

    A: Sum assured on death along with vested simple reversionary bonus and terminal bonus, if any

    • For Regular and limited premium policy: sum assured on death is 11 times of annualized premium
    • For single premium policy, the sum assured on death is 1.25 times of a single premium

    B: Minimum death benefit (ie. 105% of all premiums payable)

  5. HDFC Life Sampoorn Samridhi Plus Plan

    It is an endowment plan that offers twin benefits of life coverage and long-term savings for the financial security of your family.

    Age at entry 30-60 years
    Maximum maturity age 18-75 years
    Premium payment option Yearly, Half-yearly, Quarterly and Monthly
    Policy term 15-40 years
    Minimum sum assured Rs. 65,463
    Maximum sum assured No limit

    Benefits

    This guaranteed income plan offers guaranteed additions, expressed as a percentage of sum assured at the time of maturity of the plan or death of the policyholder.

    Policy term Guaranteed additions
    15-19 years 3 % p.a.
    20-24 years 4 % p.a.
    25 years or above 5 % p.a.

    At the time of maturity of the plan, the policyholder will receive -

    • Sum Assured
    • Accrued Guaranteed Additions
    • Accrued Reversionary bonuses
    • Interim bonus (if any)
    • Terminal bonus (if any)

    The policyholder also gets some rebate on premium as follows -

    Sum assured on maturity (in INR) Rate of rebate (per 1000 Sum Assured on Maturity)
    150,000 to less than 300,000 4.5
    300,000 to less than 500,000 6
    500,000 and above 7.5

    In the case of the death of a policyholder, the nominee will get the death benefit.

Conclusion

In today's situation, it is really essential to think about your savings and life insurance. Guaranteed income plan is one of the suitable insurance products, which offers life insurance with guaranteed returns. Compare guaranteed income plans online and enjoy the benefits of regular periodic payouts, bonus facility, life coverage and more.

Published : 29 June 2020

Written By : Naval Goel

Last Updated : 25 March 2021

Naval Goel is the CEO & founder of PolicyX.com. Naval has an expertise in the insurance sector and has professional experience of more than a decade in the Industry and has worked in companies like AIG, New York doing valuation of insurance subsidiaries. He is also an Associate Member of the Indian Institute of Insurance, Pune. He has been authorized by IRDAI to act as a Principal Officer of PolicyX.com Insurance Web Aggregator.