What is the Difference Between Guaranteed Returns and Assured Returns?

Preparing for your family’s financial future and your retirement is extremely important. With a suitable financial plan, you will be able to secure your golden years and protect your family from emergencies. Out of the different options available in the market, opting for a savings insurance plan is the most optimal choice.

A guaranteed savings plan will offer you insurance coverage and guaranteed returns through a single policy. You will get the dual benefit of insurance and wealth creation under a single policy with a savings plan. You can also get additional benefits with your guaranteed return insurance plan. 

For instance, most insurers like Tata AIA life insurance offer different features like loan facilities with the Tata AIA life insurance policy. Along with this, you can include your spouse in the coverage with their plan.

While the features may seem quite attractive, it is important that you carefully read about the plan you are purchasing. The terminology used for the plans can be a bit confusing, and you may purchase a plan without fully understanding the benefits. 

For example, many individuals generally think guaranteed and assured returns are the same. However, they do have certain differences.

What are Guaranteed Returns?

In guaranteed returns, the bank’s or insurer’s financial health conditions aren’t a prerequisite. If you own a guaranteed savings plan, your insurer will have to pay out the benefits promised to you regardless of their financial condition. As the plan reaches maturity, you will get a guaranteed payout as a benefit. 

Suppose you have purchased a guaranteed return insurance plan. In that case, the guaranteed return is the minimum amount you will get when the plan reaches maturity, or you outlive the tenure listed in the insurance policy.

What are Assured Returns?

Assured returns are the returns provided by an insurer or when it is already fixed that the benefits of the plan will be offered regardless of the fund’s market performance. Regardless of whether the fund’s market performance is poor or the insurer is facing some volatility, you will be paid the funds you were assured. 

But the assured benefit will depend on the financial state of the insurer. If the bank or insurer declares bankruptcy or doesn’t have the funds to pay off the investor, you will not get the benefits. The market performance of the funds has a crucial role in the way an insurance plan pays you. Providing large funds as loans and protecting several people will be done if the company or the bank earns profits. This is why small to medium banks offer assured returns instead of guaranteed returns to ensure they do not face any troubles in the future.

Difference Between Assured and Guaranteed Returns

Given below are some of the differences between sum assured and guaranteed returns:

Assured ReturnsGuaranteed Returns
Risk factorThe risk factor in guaranteed return plans is quite low, as the returns aren’t dependent on market volatility.The risk factor in assured return plans will depend on the credibility of the insurer or bank you have chosen.
Claim rejection probabilityWith guaranteed return plans, your chances of claim rejection are almost negligible. This is because guaranteed return plans are offered only by reliable and well-structured companies. Your claim can get rejected with a sum assured plan based on the institution’s financial health. If your claim is rejected because of their financial health, you can always go to court.
Return potentialThe amount you can get through guaranteed return plans is a bit low compared to assured return plans. The monetary value of your insurance policy grows over the tenure in assured return plans so, your returns will increase as well. Thus, the amount that you get is higher.


Guaranteed return and assured return plans may seem similar on the surface, but they have unique differences. With a guaranteed return plan, you will get the amount you were promised at the time of policy purchase. In assured return plans, the returns you will get are dependent on the institution’s financial health. While your assured return amount can grow when the monetary value of your insurance policy grows, your claim can get rejected because of the institution’s poor financial health.