In today’s day and age, maintaining financial stability has become quite difficult for most of the individuals. Understanding the requirement of financial stability in an individual’s life, the insurance companies have come up with guaranteed income plans. The guaranteed income plans are specifically designed to cater to the requirements of the risk-averse investors and offers them the benefit of life insurance along with maturity benefits and regular guaranteed payouts. The guaranteed income plan offers financial security by providing regular income at a pre-defined percentage (selected by insured and insurer) of Sum Assured. The USP of the plan is that one can receive the income yearly, half-yearly, quarterly or monthly. This innovative insurance product is a traditional plan that comes with bonus facility, where the insurance holders are not required to worry about the ups and downs of market; rather they get to enjoy the maximized returns.
|Plan Name||Plan Type||Entry Age||Age||Policy Term|
|HDFC Life Click2Protect Plus||Term Plan||18 - 65 years||28 - 75 years||10 - 40 years|
|ICICI Prudential Cash Advantage||Money Back Plan||0 - 60 years||18 - 80 years||15 - 20 years|
|HDFC Life Sampoorn Samriddhi Plus Plan||Endowment Plan||30 - 60 years||18 - 75 years||15 - 40 years|
|SBI Life Smart Money Back Gold Plan||Money Back Plan||4 - 25 years||26 - 70 years||12 - 25 years|
|SBI Life - Saral Shield||Term Plan||18 - 60 years||65years||5 - 30 years|
|Aviva i-Life Plan||Term Plan||18 - 55 years||70 years||10 - 35 years|
|HDFC Life Sanchay Plan||Endowment Plan||30 days - 45 Years||18 - 70 years||15 - 25 years|
|Canara HSBC OBC Smart Stage MoneyBack Plan||Money Back Plan||8 - 55 years||70 years||15 years|
|Max Life Guaranteed Monthly Income Plan||Money Back Plan||25 - 65 years||71 years||6 - 11 years|
|Aegon Life Term Plan||Term Plan||20 - 65 years||75 years||10 - 75 years minus age at entry|
Guaranteed Income Plans are designed for salaried people who fall in the age bracket of 18-60 years and policy term for them extends from 10 years to 30 years.
At the time of maturity, the life insured receives the simple reversionary bonus along with terminal bonus, if any. In case, the payout period is approximately 15 years, then the insured is paid the regular amount which is pre-defined percentage of sum assured.
In case of unfortunate event of death of the insured during premium paying term, the nominee of the policy receives the basic sum assured amount along with the reversionary bonuses and terminal bonus, if any. And, the payouts are carried for the next 15 years or as mentioned in the policy. In case of demise of the insured after premium paying term or during the payout period, the nominee receives the sum assured amount along with the other benefits.
Tax deduction under Section 80(C) is available every year and tax exemption under Section 10(10D) is available on the maturity proceeds, subjected to the terms and conditions.
The traditional plan comes with an inbuilt rider i.e. Accidental Death Benefit Rider.
There are some traditional insurance plans, which offer fully guaranteed returns, whereas the other plans offer partially guaranteed returns. The products available at Policybazaar are fully guaranteed in nature. In the below mentioned table we have shown a comparison that indicates the rate of return for few traditional products, which is computed at a sample modal point. In this table different plans have different pay terms and policy terms and can be suitable for different needs. Thus, this table is only for the purpose of illustration.
|Insurer||Plan Name||Rate of Return||Guarantee|
|LIC||New Jeevan Anand||3.56%||Partially Guaranteed|
|LIC||Jeevan Labh||5.15%||Partially Guaranteed|
|Bajaj||Goal Suraksha||6.29%||Fully Guaranteed|
|HDFC Life||Sanchay Plus LTI||5.96%||Fully Guaranteed|
|HDFC Life||Sanchay Plus Guaranteed Income||5.61%||Fully Guaranteed|
|Max Life||Monthly Income Advantage Plan||5.82%||Partially Guaranteed|
|HDFC Life||Sanchay||5.71%||Fully Guaranteed|
|ICICI||Assured Savings Insurance Plan||5.53%||Fully Guaranteed|
The above mentioned rate of returns is based on the below mentioned assumptions and the date for Internal Rate of Return (IRR) is taken as 15th August:
|Plan Name||Age||Annual Premium Equivalent (APE)||Premium Paying Term (PPT)||Policy Term|
|New Jeevan Anand||35 years||Rs.1 Lakh||25 years||25 years|
|Jeevan Labh||35 years||Rs.1. 56 Lakh||16 years||25 years|
|Goal Suraksha||35 years||Rs.1 Lakh||5 years||15 years|
|Sanchay Plus LTI||35 years||Rs.1 lakh||10 years||11 years|
|Sanchay Plus GI||35 years||Rs.1 Lakh||10 years||11 years|
|Max Life MIAP||35 years||Rs.1 Lakh||15 years||25 years|
|HDFC Life Sanchay||35 years||Rs.1 Lakh||5 years||15 years|
|ICICI ASIP||35 years||Rs. 1 Lakh||5 years||15 years|
Here is how the rate of return of Sanchay Plus product have reduced over last few months due to declining interest rate regime in India
|Date||Sanchay Plus Guaranteed Income|
|Premium Payment Term:10 years||Premium Payment Term:12 years|
|Aug' 2019||200% of Annualised Premium||225% of Annualised Premium|
|Dec'2019||195% of Annualised Premium||217% of Annualised Premium|