Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term

Protect Your family’s financial future with Kotak e-Term. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Lifetime Income Plan

Retirement years are the golden years of life. Know more

Close

Get a Call

Enter your contact details below and we will get in touch with you at the earliest.

  • Select your Query

Thank you

Our representative will get in touch with you at the earliest.

Difference Between Guaranteed Savings Plan and ULIP

A guaranteed Savings Plan (GSP), is a non-participating non-linked endowment life insurance plan.  ULIP provides the dual benefit of investment and insurance.

  • Apr 26, 2022
  • 4,151 Views

Financial planning and safety are critical for almost all of us because we need to be financially strong to handle the different situations for ourselves and our families in every phase of life, ensuring a secure future for our families and us.

However, it might be difficult for many to select the right financial product for themselves, given the limitless availability of financial plans. So, if you are planning to invest and looking for an insurance plan to fit your financial goals and requirements, you may look for Unit Linked Insurance Plans (ULIPs).

Thus, to make it clearer for you, we will discuss the difference between a guaranteed savings plan and ULIP. This will help you understand why ULIPs have become popular and why they may be a better investment option when comparing ULIP and guaranteed plans.

Difference between Guaranteed Savings Plan(GSP) and Unit Linked Insurance Plan(ULIP)

Here is a table based on the important parameters to suggest the difference between guaranteed savings plan and ULIP.

Difference between Guaranteed Savings Plan and ULIP

Parameters

ULIP

Guaranteed Savings Plan

Purpose

Dual benefit of investment and insurance

Mainly non-participating insurance and guaranteed returns

Objective

Investment and insurance with market-linked opportunities

Guaranteed Savings/returns

Tax benefit

Available under Section 80C & 10(10D)

Available under Section 80C

Return on investment

Variable return based on the type of fund invested in and markets’ performance

Guaranteed return as the investment in volatile and risky funds is low.

Charges

All the charges are transparent and the policyholder is informed beforehand about them

Managing GSP can be a little expensive. Can include some hidden charges based on the policy terms.

When should you consider

To be considered when you require life insurance protection and a good return to stay in sync with market growth.

If you manage ULIP wisely you can get a good long-term return.

To be opted by those who don’t want to take any risk and need guaranteed return at a stable rate of interest.

How your money is utilized

The premium paid is divided into two parts. One goes towards insurance and the other one towards investment in market funds.

The premium directly goes towards insurance cover. The policyholder is promised a guaranteed payout.

SIP

Yes

No

Investment portfolio

You can manage which funds you want to invest in and switch between them.

You cannot track the exact portfolio until the insurance company reveals its holdings

No method of knowing the investment portfolio. The whole fund is managed by the insurance company

Lock in period

3 – 5 years depending on policies

Locked till maturity. Can be discontinued after 3 years without losses and payment based on the premium deposited

Security

No security on investment as linked to market products

Highly secured & Guaranteed return

Ideal term

Suggested for long term

Preferred Long term


The information mentioned above is enough to tell you all about ULIP vs Guaranteed plan. From what we have seen, ULIPs seem to be a better deal for people who are aiming at long-term wealth generation. Both ULIPs and Guaranteed Plans are good investment tools. The requirement will differ in each.

If you are looking for a long-term investment and balanced or optimized returns, ULIP is tailor-made for you. However, if you know that future holds uncertainties and you need to invest for those unforeseen situations, guaranteed plans can be your savior.

In this policy, the investment risk in the investment portfolio is borne by the policyholder.

Kotak e-Invest

Download Brochure

Features

  • Return of Mortality Charges*$
  • Enhanced Protection
  • Multiple Plan Options
  • Zero Premium Allocation Charges
  • Tax Savings^

Ref. No. KLI/22-23/E-BB/521

T&C

- A Consumer Education Initiative series by Kotak Life

Similar Articles

ULIPs Investment – A Boon or Bane?

What is the Time Value of Money (TVM)?

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

How to Increase Net Worth Along with Family Protection

How Much Wealth Can You Create from ULIP in 10 years?

What are the Best Short-Term Investment Plans with High Returns?

8 Charges in ULIP That You Must Know

What are Some of the Safest Investment Options in India?

Which are the Best ULIP Plans in India for Children?

ULIP Benefits You Can Avail from Early Investing

How Does an Endowment Plan Work?

Why Should I Invest in ULIP?

How to Use Recurring Investment Strategies to Build Wealth?

What's Better for Your Child's Education? Child Plans or Mutual Funds?

Creating a second source of income with life insurance

Corporate Bonds: Meaning, Types & Benefits

Which are the Best Investment Plans for Indian Senior Citizens in 2022?

Why Should You Consider Guaranteed Savings Plan for Long-Term Investment?

Everything You Must Know About ULIP Riders

Are Gains from ULIP Sale Taxable?

Factors Affecting Stock Markets

Best Investment Options in India in 2022

What are the Maturity Benefits in a ULIP Plan: Fund Value Sum Assured or Only Fund Value?

ULIP Capital Gain Tax: Check Tax Norms for Capital Gain on ULIPs

What are the Best Investment Options For Females?

Does Rupee Cost Averaging Work In Unit-Linked Insurance Plans?

What Is Financial Planning?

Which is a Better Investment - Mutual Funds Or ULIP?

Important Questions You Must Ask Yourself When Buying a ULIP Plan

Long Term Savings Plan - Best Savings Investment Plans in India

Top 10 Investment Plans Available in India

The Importance of Starting Early: Securing Your Child's Future with a Child Education Plan

What is Money Management? Definition & Example

How to Fulfil Your Financial Goals in the Next 10 Years?

Four Financial Lessons from The Vedas on Living Life to The Fullest

Why is Portfolio Diversification Important? How to Diversify Your Portfolio?

What is Fund Switch in ULIP? And ULIP Fund Switching Techniques

Got a Salary Hike? Here’s How to Plan your investment further

How to Cancel ULIP Policy?

A Step-by-Step Guide: How To Make An Investment Plan?

ULIP as an Investment for Your Child

ULIPs: Suitable for all

ULIP vs FD - Which is Better and Why?

How Can a Legal Nominee Claim ULIP Benefits are the Policyholder’s Death?

How to Choose the Best ULIP Plans to Invest in 2022?

Can ULIP Help in Achieving Short-Term Financial Goals?

What are the Advantages and Disadvantages of ULIP?

Rate of Interest on Different Investment Plans in India

Learn About Safe Investments with High Returns in India

What is the Importance of Saving Money?

Importance of Portfolio Management

What is a Savings Plan and What are is Benefits?

How to Manage Your Portfolio Like a Professional?

What is Compound Interest, And How Do I Calculate it?

Why Are ULIPs Called Flexible Investments?

Difference Between Passive and Active Investing

What is ULIP Renewal?

ULIP Investment Strategy: Top Tips to Improve Your ULIP Gains

Why Should Parents Invest in Endowment Plan?

Which is Better – FD, Mutual Fund, SIP, or ULIP?

What is ULIP Plan, and How Does it Work?

The lesser-known facts about ULIP policy that customers should be aware of?

Is This The Right Time To Invest In ULIP? Why or Why Not?

Early Investing and the Power of Compounding

लॉयल्टी एडिशन क्या हैं, और वह यूलिप में कैसे काम करते हैं?

What are Financial Assets & their types?

How is the Compound Annual Growth Rate (CAGR) Calculated in ULIP?

Why are ULIPs One of the Best Tax Saving Instruments?

Why Do You Need A ULIP Plan - All You Need To Know

Debt ULIPs vs. Debt Mutual Funds: What's the Difference?

Best One-Time Investment Plans in India

What is ULIP and Its Benefits?

4 Benefits of ULIP Fund-Switching Feature

What is Direct Investment and its Types?

How To Diversify Portfolio In 2023?

Do You Know the Difference Between Savings and Investment?

What are Index Funds and How Do They Work

Difference Between ULIP and Endowment Plan?

6 Important Tips to Maximize Your Gains with ULIP Investments

Savings Plan for Grandchildren

Why Should You Build an Emergency Fund?

How to Start Saving Money in 10 Simple Ways?

Can ULIP Policy be Transferred?

Planning Financial Goals and Objectives of Financial Planning

How To Invest Money In ULIP?

वित्तीय संपत्तियां और उनके प्रकार

Different Types of Endowment Plans

Receiving regular payouts at various stages of life

Top 5 Investment Options in 2022 for Healthy Returns

Best Investment Plans for Children - Secure Your Child's Future

Safe Investment Options with High Returns for FY 2018-19

Short Term and Long Term ULIP Plans for Wealth Creation

यूलिप के फायदे (Benefits of ULIP in Hindi)

Successful Financial Planning for Urban Women

How Is ULIP Different from Other Life Insurance Plans? Where Can I Invest - ELSS, ULIP, or PPF?

Planning for Your Child's Higher Education? Explore These Investment Options

How to Plan your Investment to Achieve Periodic Financial Goals?

Why ULIP is Better Investment for Long-Term Wealth Creation?

Best Guaranteed Returns Investment Options to Meet your Financial Goals

Top 5 Principles That Need to be Followed for Wealth Creation

How to Plan Savings from Salary?

How to Make Your Financial Portfolio?

How to Manage Inheritance Money?

How to Calculate Your ULIP Returns?

Customising investments to manage your wealth

What are Tax-Deferred Savings Plans?

What are loyalty additions, and how do they work in a ULIP?

उच्च रिटर्न प्राप्त करने के लिए सर्वश्रेष्ठ इन्वेस्टमेंट विकल्प

Investment Options for NRIs in India

Why Should You Invest in Term Insurance And ULIP?

What is a Child Money Back Plan, and How Does it Work?

How to Plan Your Child's Education - A Step-by-Step Guide

Beginner's Guide to Wealth Creation: Meaning, Strategies, & Importance

Things to Know Before Buying an Endowment Plan

ULIP Plan as a Gift

What is SIP Calculator, And How Does it Work?

What are the Best Investment Options for Young Adults?

What is NAV in ULIP, and How is it calculated?

What are the Best Investment Options for Students in India?

Benefits of ULIP as a Child Insurance Plan

Asset Allocations in ULIP - Know the Top Benefits

Endowment Plan vs Fixed Deposit?

What is Equity Mutual Funds: Meaning, Types & Benefits

Are Investment Returns Guaranteed in a ULIP?

How Can ELSS Funds Help You Save Tax & Create Wealth?

What is a Credit Score and How Can Insurance Help You Improve it?

यूलिप प्लान में परिपक्वता लाभ क्या हैं: फंड वैल्यू सम एश्योर्ड या ओनली फंड वैल्यू?

Top 10 Investment Strategies to Create Wealth

Best Investment Options to Cover Your Child's Education

Unit-Linked Life Insurance (ULIPs) vs. Term Insurance

8 Important Tips to Maximize Gains with ULIP Investments

Is the ULIP Policy Surrender Value Taxable?

Investments Options to Buy a house in India

How Do One-Time Investment Plans Work?

Are Money Back Policies Helpful? A Complete Guide

Building wealth through regular investing

How To Track ULIP Performance?

What are the Best Investment Options for Beginners or Amateur Investors in India?

What are Mutual Funds?

Learn About Safe Investments with High Returns in India

यूलिप के फायदे और नुकसान क्या हैं?

Here's Why it's a Good Time to Explore ULIPs as an Investment

ULIP NAV Meaning & How is the Return Calculated in ULIP