Term-plan-with-return-of-premium
By Okbima 15 Nov 2023 7

Term Plan With Return of Premium| Features & Benefits

 

Term Plan with Return of Premium (TROP) is a special type of term insurance. You pay your premiums regularly, just like any insurance plan. But, at the end of the policy term, the insurance company hands back all the premiums you paid (minus the GST). While you're alive during the policy term, you also get survival benefits. You're covered in case something happens, and if nothing does, you get your money back.

 

What is Term Plan with Return of Premium?

A Term Plan with Return of Premium (TROP) works similarly to a regular term plan, ensuring life coverage for the policyholder and their family members.  In a term plan with return of premium, the policyholder becomes eligible to receive a return of the premium amounts after the policy tenure, provided they survive that term. 

Additionally, TROP provides death benefits to the nominee or beneficiary in the event of the policyholder's demise. This means that a term insurance plan with return of premium delivers dual advantages within a single-term plan. This type of plan is particularly suitable for individuals who are seeking a medium for savings along with life coverage. 

 

Best Term Plan with Return of Premium 2023

Choosing the best term insurance plan with return of premium in 2023 is a time-consuming process. So, below we have mentioned the top plans that you can look up to:

 

Term Insurance with Return of Premium

Entry Age

Maturity Age

Sum Assured

                                 

ICICI iProtect Return of Premium

18 to 60 years

85 years

25 Lakhs to 10 Crores

Get a Quote

HDFC Click 2 Protect Super

18 to 65 years

85 years

50 Lakhs to 20 Crores

Get a Quote

Max Life Return of Premium

18 to 65 years

82 years

25 Lakhs to 10 Crores

Get a Quote

TATA AIA SRS Vitality Protect

18 to 60 years

85 years

50 Lakhs to 2 Crores

Get a Quote

Bajaj Allianz Life eTouch

18 to 55 years

99 years

50 Lakhs to 10 Crores

Get a Quote

PNB MetLife Mera Term Plan Plus

18 to 50 years

80 years

50 Lakhs to 10 Crores

Get a Quote

Canara HSBC Young Term Plan Life Secure TROP

18 to 45 years

99 years

25 Lakhs to 20 Crores 

Get a Quote

Aditya Birla Capital DigiShield Plan

18 to 65 years

85 years

50 Lakhs to No Limit

Get a Quote

SBI Life Smart Swadhan Plus

18 to 65 years

70 years

20 Lakhs to 10 Crores

Get a Quote

 

What are the Benefits of Term Plan with Return of Premium?

The Term Policy with Return of Premium (TROP) has several benefits that individuals should consider when looking at insurance options. Let's look at the advantages, including an additional one unique to TROP:

• Return of Premium Benefit: TROP offers the benefit of a premium refund upon the policy's maturity. If the life assured survives the entire policy tenure, they become eligible to receive the total premium amount invested in the plan

• Death Benefits: TROP extends death benefits, offering the total sum assured amount to the nominee in the unfortunate event of the life assured's demise, and it varies based on factors such as the plan, premium payment mode, or the chosen coverage type.

• Rider Benefits: Insurance companies enhance their coverage by offering a range of riders to complement the base policy, such as critical illnesses like heart attacks, stroke, cancer, and cardiovascular surgeries.

• Accidental and Disability Rider: Accidental and Permanent Disability Rider provides crucial financial protection in the unfortunate event of permanent disability caused by an accident during the policy term, ensuring continued support for policyholders.

• Tax Benefits: Purchasing TROP makes individuals eligible for tax savings. The premium amount paid and the benefit payout are exempt from taxes under sections 80C and 10(10D) of the Income Tax Act, of 1961.

 

What are the Features of Term Plan with Return of Premium?

A Term Plan with Return of Premium (TROP) is a special kind of insurance. It not only gives money if something happens to you but also returns the money you paid as premiums. 

Let's look at the unique features of TROP that make it different from other life insurance:

• Flexible Payment Options: Can opt for a one-time payment to settle the amount in full instantly.

• Guaranteed Returns: TROP promises you'll get back the premiums you paid, except for extra amounts for riders and add-ons.

• Maturity Benefits: If you're still alive after the policy term, TROP gives your premiums back. This ensures you don't lose the money you paid over the years.

• Surrender Value Options: If you need to stop paying or surrender the policy, TROP allows this based on how you pay your premiums.

• Paid-Up Options: TROP helps those without a fixed income. If you can't pay, the plan continues with a lower cover after a few premium payments.

 

How Does Term Plan with Return of Premium Work?

Let's take a closer look at how a special type of insurance works, using Mr. Vishal as an example:

Mr. Vishal, is a 30-year-old guy who wants to make sure he has some financial protection. He's healthy, doesn't have any medical issues or smoke, and decides to get an insurance plan that gives him money back. He picks a coverage of Rs. 1 Crore.

Now, Mr. Vishal needs to pay Rs. 16,977 every year for 30 years. If something happens to him during this time, like an accident or sickness, the person he chooses (called a beneficiary) gets Rs. 1 Crore.

But, if Mr. Vishal stays healthy and lives through the whole 30 years, something cool happens. He gets all the money back that he paid as premiums. In simple terms, if he paid Rs. 16,977 every year for 30 years, the total is Rs. 5,09,310. This entire amount is given back to him when the plan ends.

So, this special insurance not only helps Mr. Vishal's family if something bad happens to him, but it also gives him his money back if he stays okay throughout the whole insurance time. This double benefit makes this type of insurance a good choice for people who want complete coverage for their lives.

 

What is the Difference Between Term Insurance and Term Plan with Return on Premium?

Term Insurance Plans usually come in two main types: “Pure term insurance” and “Term Plan with Return of Premium (TROP)”. These variations serve different purposes, meeting diverse individual goals. It's crucial to note that not all term plans assure returns like traditional investment products. 

Let's see the details of the difference between term insurance and return of premium:

 

Pure Term Insurance Plan

Term Plan with Return of Premium (TROP)

It is a pure protection plan, pure term insurance is the simplest and most affordable form of life insurance.

Term insurance with a return of premium is a variant of the term insurance plan.

The coverage is offered only as a death benefit.

Offers insurance coverage as a death benefit and the benefit of the return of premium if the policyholder survives the entire policy term.

The sum assured amount is usually 10 times the annual premium paid.

Offers a comparatively lower sum assured amount to the policyholder.

The premium rate is very affordable.

Has a considerably higher premium rate.

It is best suited for individuals who want to provide financial protection to their families.

Best suited for individuals who don't mind gaining some returns along with the benefit of insurance coverage.

It offers the benefit of tax exemption under section 80C of the Income Tax Act. 

It offers the benefit of tax exemption under section 80C of the Income Tax Act. 

 

Who can Buy a Term Plan With Return of Premium (TROP)?

When it comes to deciding a term plan with return of premium (TROP), individual financial objectives play an important role. The suitability of this plan is based on various factors, including age, income, lifestyle, and health.

Consider a term plan with return of premium if you fall into the following categories:

• Unmarried Individuals: If you are unmarried and have financial responsibilities, particularly for retired parents, a TROP can be a wise choice. In the unfortunate event of your demise, the death benefit covers their expenses, maintaining financial independence for them.

• Married Individuals with No Children: Even if you are married without children, a term plan with return of premium can be a wise choice. If your partner relies on your income, TROP offers financial support for your family's future and the maturity payout at the end of the policy term.

• Married Individuals with Children: For those with children, protecting their future is a primary responsibility. TROP ensures that your loved ones and children are financially protected in case of unforeseen events, with the added advantage of a maturity payout at the end of the policy term.

 

Confused about term insurance? Ask our experts today!

 

Why Should You Choose A Term Plan with Return Of Premium Option?

Choosing a Term plan with return of premium (TROP) can be a smart move for a few reasons. Let's see why:

• Growing Savings: A term plan with a return of premium is a good choice because it not only protects your finances but also gives you a chance to save money over the policy period.

• Support for You and Your Family: Buying a term plan with a return of premium is a strategic option that will help your family if something happens to you but also give you back the money if you stay healthy through the whole insurance period.

• Extra Benefits: TROP plans often come with added bonuses such as benefits for disabilities, coverage for accidental deaths, not having to pay premiums if something specific happens, and protection against serious illnesses.

 

Secure your family's future today – Get a free quote!

 

How to Buy Online Term Plan with Return of Premium from Okbima?

If you want to buy the best term insurance with a return of premium plan from Okbima, here's a step-by-step process:

Step 1: Firstly you Visit Okbima official website.

Step 2: Then click on the "Term Insurance" icon, and fill in the basic details.

Step 3: Compare and choose the different plans based on your needs and complete the payment process.

Step 4: Once payment is completed, policy details will be send it to your registered email ID.

 

Conclusion

In conclusion, buying a term plan with return of premium is a wise decision. This special insurance doesn't just give strong protection for life but also promises to give back all the premiums if you live through the whole term. The idea of getting back all the money you paid adds a unique way to build wealth to the coverage. By picking this complete option, people make sure their family is financially secure if something happens, and they also get the peace of mind that comes with the chance of getting some money back.

 

FAQs

Are the term plans with the return of premium option worth it?

Term plans with a return of premium can be worth it for those seeking life coverage with a refund on premiums paid if they outlive the policy term.

 

What is the return of premium in term life insurance?

Return of premium in term life insurance means receiving back the total premiums paid if the policyholder survives the term.

 

Which companies offer a term insurance plan with a return of premium option?

Various companies offer term insurance plans with a return of premium option, including Okbima.

 

Which is the best term plan with return of premium?

Looking for the best term plan with a return of premium depends on individual needs, comparing features, and considering reputable insurers.

 

What is the catch with the Term insurance plans with the return of premium option?

The catch with term insurance plans with return of premium is higher premiums compared to regular term plans, providing a refund only if the policyholder survives the term.

 

Can you get your money back from term insurance on maturity?

Term insurance plans typically don't provide money back on maturity; however, the return of premium option ensures a refund if the policyholder survives the term.

 

What does the return on premium mean?

Return of premium in term life insurance refers to getting back the total premium paid if the policyholder outlives the policy term.

 

What is the death benefit under the return of premium Term insurance plan?

The death benefit under the return of premium term insurance includes both the sum assured and the return of total premiums paid, offering comprehensive coverage.

 

Are There Any Riders Available With TROP?

Riders, such as critical illness cover, can be available with term insurance plans with a return of premium option, enhancing overall protection.

 

What Is The Eligibility Criteria For Term Plan With Return Of Premium?

Eligibility criteria for term plans with return of premium vary among insurers, considering factors like age, health, and lifestyle.

 

How Does Smoking Habit Affect The Term Plan With Return Of Premium?

Smoking habits may affect the premium in term plans with a return of premium, potentially leading to higher costs for smokers.

 

Should I Buy A Regular Term Plan Or TROP?

Choosing between a regular term plan and one with the return of premium depends on individual preferences, financial goals, and budget considerations.

 

What Is The Grace Period In Term Plan With Return Of Premium?

The grace period in term plans with return of premium allows a specified time for premium payment after the due date, ensuring continuity of coverage.

 

How to buy term life insurance online?

To buy term life insurance online, visit the insurer's website, fill out the application, provide the necessary information, and complete the online purchase process.

 

What are the death benefit payout options under term insurance with return of premium?

Death benefit payout options under term insurance with return of premium typically include a lump sum payment, installment payments, or a combination of both.

 

Can I add riders under the term insurance plan with a return of premium?

Yes, riders can often be added to term insurance plans with a return of premium, providing additional coverage tailored to specific needs.

 

Is Critical illness cover offered under term insurance with a return of premium option?

Critical illness cover is commonly offered as a rider under term insurance with a return of premium, providing financial protection in case of specified critical illnesses.


 

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