Why choose LIC over Mutual Funds
1) Life insurance is a good investment option. It not only provides good returns but also provides financial protection. Whereas mutual funds are purely for investment purpose only with high risks.
2) Life insurance guarantees fixed returns on your investment irrespective of market fluctuations. The returns from mutual funds are solely dependent on the stock market performance.
3) LIC investments are protected by the government (of India) and so there is no need to worry about investment or the returns. But this guarantee and protection are not there in mutual fund investments.
4) Life insurance is a regular and disciplined long-term commitment and it gives assured returns for the money. In mutual fund investments, people tend to get impatient to get returns and are most likely to withdraw their money if the desired returns are not seen.
5) Life insurance investments are designed to take care of long-term needs of all class of people. However, mutual fund works better for people with high disposable income, who can take risks and look for high returns.
Above all, life insurance provides financial protection for your family in your absence which mutual funds cannot provide.