Life Insurance

When To Consider Buying Guaranteed Life Insurance

Nov 15, 2021

A guaranteed life insurance plan is nothing but a traditional life plan that offers fixed returns. The cost of the plan also remains fixed through the entire policy period. Everyone needs to have a life insurance plan. However, it is important to buy a guaranteed life insurance plan at the right time so that you can provide a financial backup for your family in case you die unexpectedly. 

The perfect time to buy guaranteed life insurance

As stated, everyone needs life insurance. It is better to buy life insurance as early on in life as possible. If you get life insurance early when you are young and fit, you will get a great plan at a very low rate. You can continue with the plan until late in life and cover your family members very easily. Just remember to choose the correct type of life insurance so that you and all of your dependents get the most value out of the coverage.

Advantages of buying a guaranteed life insurance plan

There are many benefits you get when you buy a guaranteed life insurance plan. They include:

  • Life cover - A guaranteed life insurance plan offers a guarantee and fixed life cover that allows you to keep your loved one’s financially protected at all times. This is a good assurance and something that everyone surely needs.
  • Investment opportunity - You get a chance to invest in a disciplined manner. A part of the premium you pay gets invested in low-risk financial instruments that allow you to stay invested in a safe and consistent manner.
  • Fixed returns - The guaranteed life insurance plans offer a fixed return on the investments and so you get fixed dividends and bonuses. This is another good reason why you should invest in such a life insurance cover.
  • Affordable - The plans are available in a ride price range. While the term insurance plans are very cheap, the ULIPs are more expensive. You can choose a plan that fits your budget and then get the best possible cover. 
  • Easy to buy - The modern-day life insurance plans are very easy to procure. You can go online and get the plan in a quick and convenient manner. This is another very handy benefit of the guaranteed life insurance plans and even more reason why you should invest in such a plan right away.

Keeping these advantages in mind, it can safely be said that everyone needs a good life insurance plan, and the cover should be bought early on in life to ensure the most comprehensive and wholesome coverage.

Disadvantages of buying a guaranteed life insurance plan

Sadly, there are a couple of disadvantages that also come with these life insurance plans. They are:

  • Low returns - The investment options are not as wide and vast on the traditional life insurance plans. The returns available are also quite low, as compared to other investments such as SIPs and equities. If getting high returns is your chief motive for buying the plan, this may not be the best option for you.
  • Not very flexible - The terms and conditions are pre-decided and fixed by the life insurance company from which you pay the life insurance plan. There are certain exclusions and restrictions as well. This makes the plans restrictive and not completely flexible. 

The final word

Keeping all the pros and cons in mind, it can be seen that a guaranteed life insurance plan is actually of great use to people from all walks of life. If you haven't bought a good life cover yet, get one at the earliest. The traditional, guaranteed life insurance plans prove to be a good option here. 

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