What is a Guaranteed Income Plan?

Even during uncertain times in your life, a guaranteed income plan can provide you with a regular income. The policy provides life insurance and savings as part of a single policy. These plans are known as guaranteed income plans because their benefits are guaranteed or fixed. A death benefit is also included during the policy's tenure.

However, if the insured survives the policy tenure, they will receive a maturity benefit. An investor looking for insurance protection and guaranteed savings should consider these plans.


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WHO IS IT FOR?

This is a Guaranteed Income Plan that provides assured guaranteed returns. This is suitable for:

  • Risk-aversive investors who prefer guaranteed returns
  • People who want to plan their retirement & create regular tax-free income
  • Businessmen, who are already taking risk in their businesses & wishes to balance it out by investing in safe, assured, tax-free income-generating products.

WHY IT MAKES SENSE TO DO IT NOW?

A Non-Linked Participating Money Back Life Insurance Plan to fulfill your financial goals

  • Investing in this product until 31st March 2023 (subject to policy getting issued) will be tax-free income.
  • Policy issued starting April 1st, 2023, having a premium of Rs. 5 lakhs & above will no longer be tax-free.
  • The income from such investments will get added to the taxable income & will get taxed at the marginal rates.

What are the Benefits of a Guaranteed Income Plan?

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Guaranteed Plan Benefit

Once the premiums are completely paid, then the policyholder can get monthly income payouts for a definite tenure that is too tax-free! As per the Income Tax Act of 1961, this income is exempted from the tax.

The guaranteed income plan usually has a payout period that is divided into two parts. During the first part, the policyholder is paid the assured income monthly. Once the first half of the tenure is completed, the monthly income is doubled.

The best part about a guaranteed income plan is that you dont have to wait for years to get the payment of the premiums. Instead, as soon as your tenure is done you can start receiving the assured sum as the monthly payout.

This monthly income scheme comes with death benefits known to be guaranteed protection. As per the regulations, god forbid the insurer dies during the tenure of the plan, then the nominee will get the option to receive the death benefits as a lump-sum amount. The nominee can also get this as income for ten years after the demise of the insurer.

Emergencies can knock up at any time, for this you have the option to get the payout after the maturation of the monthly income as a lump sum amount.

Is there any risk associated with this product?

The product does not have any kind of investment risk but there are a few minor drawbacks. The product requires a minimum commitment to pay 5 premiums. The annuity is paid over a long-term period.

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