We all like to be prepared for the future. Life can throw us challenges and curveballs at the unlikeliest of times. No one can deny the fact that we do everything in our capacity to minimise the impact that uncertainties can have on our lives.

As responsible individuals, we aspire to not only secure a financially robust life for our loved ones but also ensure a steady income for them. A policy of life insurance with guaranteed returns will help you to fulfil this responsibility efficiently. Therefore, it would be worth investing in an insurance plan that offers guaranteed benefits along with the flexibility to choose your investment horizon.

A pure protection plan in the form of term insurance will only provide your loved ones with a financial cushion to fall back on in times of need. However, it may not serve the purpose of giving you assured or guaranteed returns. If that is your goal, you can go for one of the following plans that combine the components of insurance and investment:

Endowment Plans and Money Back plans

These are the savings plans that provide you with the sum assured and a guaranteed or vested bonus at the time of maturity, in addition to tax planning and insurance cover.

Endowment Plan

Endowment plan is a combination of insurance and savings. It offers three benefits to the life assured under a single plan – long term savings, life insurance and tax benefits. This policy not only provides protection to the insured but also helps the policyholder save some money on a regular basis for future financial milestones. The traditional endowment plans promise a minimum value as on specified date as long as the premiums are paid as per schedule. It is one of the most disciplined methods of saving money for all your future financial needs.

Let us look at few key benefits of buying an endowment plan:

• Low risk plans that offer a minimum guarantee
• In the case of the life assuredÂ’s demise the assured amount (Sum Assured) is given to the nominee.
• It is a goal based savings which helps to create corpus to fulfil important life goals
• Option to avail additional coverage via riders at a nominal additional cost
• Allows taxpayers to claim tax benefits according to provisions defined under Section 80C and Section 10(10D) of the Income Tax Act. Tax laws are subject to change.
• Provides the option of obtaining a loan against the policy in case of a financial emergency.

Suggested Read: Endowment Plans

Money Back Plans

As the name suggests, this type of life insurance plan offers a specific amount/ percentage of the sum assured as money back to the life assured at pre-decided intervals. This money back benefit is usually called survival benefit.

In case, the insured dies during the policy term, then a death benefit will be payable to the nominee, without any deduction of past survival benefits already paid and the policy would be terminated.

Here are the benefits of a money back policy:

• It is a good option for individuals who want their savings to be accompanied by an element of liquidity
• Most of these plans are eligible for bonuses as declared (if any) by the insurance company
• Many insurance companies also provide guaranteed additions on certain money back plans
• Money back plans come with in-built life cover
• Ready corpus for financial emergencies
• Riders can be opted for additional protection at a nominal additional premium
• Tax benefits can be availed as per the prevailing tax laws

Suggested Read: Guaranteed Money Back Plans

Annuity/Pension/Retirement Plans

Pension plans are designed specifically to cater to your retirement needs and you can choose from an array of such solutions - under a deferred annuity plan you receive regular income after a few years, whereas in an immediate annuity life insurance you get the benefit in the form of regular income throughout your life. Effectively, these help you create a savings corpus for your retirement years and therefore bring guaranteed returns.

With pension/retirement plans these days, here is what you get:

• Lump sum up to an extent defined at maturity of a pension plan
• Monthly pension/income through annuity purchased using the balance amount

Here are the benefits of retirement plans:

• Financial independence and peace of mind even after your retirement.
• Retirement plan benefits replace income and provide a comfortable lifestyle during the golden years.
• Accumulate enough wealth to deal with medical emergencies.
• Option to Retire Early if you have adequate retirement corpus
• Legacy Planning
• Tax Benefits

Suggested Read: Annuity Plans

The insurance market is ripe for life insurance plans that guarantee your returns, whether regular payouts or maturity benefits throughout the life of the policy and beyond. Choose the one that matches your needs and choose wisely!