Term insurance plan with survival benefit is the latest demand in the insurance sector. Actually there is no connection between both term insurance and survival benefits. From our general information, term insurance is a kind of policy where one can buy a huge life cover by paying a very nominal premium payment. After every year he/she have to renew the policy and at the end of the plan there is zero survival benefit. This has become a drawback for the term plans, as people don’t find these policies useful due to not getting back their money back. To change this phenomena and widen the market for term insurance plans, many companies now started launching term insurance plans with survival benefit option. In this article we will try to find such policies available in India now.
Top term insurance plans with maturity benefit
Mostly the new online term insurance plans launched by new insurance players are coming under this bracket. These category can be divided in further parts as in few such plan only premium is returned back (ROP) and in some other case premium with little more bonus can be added. Let’s find out few term insurance plans with money back option.
- Shriram Life Cash Back Term Plan : This is a non-linked and non-participating insurance plan with return of premiums at maturity.
- Aviva i Shield Plan : Aviva i shield online term plan will provide guaranteed 110% of premiums paid back on maturity. In case policy value is more than 20 lakh, one can get additional rebate on premium paid.
- AEGON Religare iReturn Insurance Plan: This is also a ROP or return on premium plan. In case death sum assured value will be paid as per pure term plan rules. But in case of maturity the premium paid will be returned back.
- Tata AIA Life Insurance iRaksha TROP: Under this policy one can pay premium regularly or limited period or single premium. In any case on maturity premium paid till policy end will be returned back to policy holder.
- ICICI Prudential Life Guard – Return Of Premium: This plan is available in 2 flavor in which with ROP, one can premiums paid back after policy end.
- Met Suraksha TROP: PNB Metlife insurance plan Met Suraksha TROP is also a policy with return of premium facility after maturity.
- Max Life Premium Return Protection Plan: Max Life has also launched a term plan to attract customers with ROP option on maturity.
Don’t Miss Term insurance plans of LIC of India
Term insurance plan with survival benefit VS pure term plan
To explain the comparison between a pure term plan with a return of premium term plan I have prepared a chart below. I have considered Aegon Religare insurance company and compare both of their 2 types of term plans : iReturn and iTerm plan.
So from the chart it is clear that for the same life cover of 1 crore you have to pay 3 times more premium in case of ROP plans. If you choose a pure term plan, then you will pay total 8,424 X 20 = Rs 1,68,480, but for the ROP plans you will pay a total 4,51,540 and get the same back without any interest amount. If you would buy a pure term plan and invest rest amount (22,577 – 8,424 = Rs 14,153) in any traditional deposit scheme, lets say PPF account. Then in 20 years (with 5 year extension) you can get Rs 7,94,070 as maturity value. So straightway this calculation completely beat the term plans with ROP feature. Why do you like to buy a term insurance plan with survival benefit? Share your experience or query if any by a simple comment.