Life Goals Loading…

Get Life Goals Back-up Plan

Have us call you

Please enter a Name
Please enter a Mobile No.
Please select a option
Please select a option

Thanks for sharing your details, A Sales representative from
Bajaj Allianz Life will contact you shortly.

Dear Customer, we request you to connect with us in our next business working hours, (Monday to Saturday 24*6) Thank you, Have a great day ahead.

Term Plan With Return Of Premium – Know All About It

Term plan with return of premium

Term Plan With Return Of Premium – Know All About It


calender-blue

March 17, 2020

By : Bajaj Allianz Life

Many Life insurance customers have expressed their concern on losing out their money if no claims are made during the tenure of their term insurance plan. To address this, life insurance companies are offering term insurance plans with a return of premium option. It means that if the Life assured continues to live through the policy tenure then at the end of policy term the life insurance company returns all the premium paid towards the policy.

How does a term plan with return of premium work?

Let’s assume a person buys a Term Insurance plan with Return of Premium option with a life cover of Rs. 1 crore for a 30-year term, and pays Rs. 10,000 annualised premium for 30 years. If the Life assured passes away during this policy term of 30 years, the life cover amount will be paid to his/her beneficiaries. But, if the Life assured lives till the end of 30-year policy term, he/she will get back the premium amount paid (10,000*30=3,00,000) less GST ,underwriting extra premiums, and premium paid towards riders, if any at the end of the policy term

Benefits of a Return of Premium Term Insurance Plan

1. Benefit on maturity: As explained above, the biggest benefit to buying a return of premium term insurance plan is the refund of the premium at maturity. Thus a return of premium term insurance plan ensures that a Life assured does not lose the premiums paid over the years, in case he/she survives the policy term. Such term insurance plans thus act as saving instrument too, in addition to an insurance cover.

2. Continuation of policy, even in case of non-payment of premiums: Return of premium term insurance plans provide paid-up options in case a Life assured misses paying premiums. This benefit is useful for those who don’t have a fixed or regular source of income and thus carry the possibility of missing some premium payments. Through this option, in case a Life assured discontinues paying premiums after three policy years, the term insurance policy continues but with reduced benefits. The premium paid by the Life assured will be returned at maturity if the Life assured survives the policy term, whereas if the Life assured dies, the beneficiaries will get a reduced sum assured.

3. Guaranteed returns on of premiums: Term plans with the return of premiums benefit guarantee a cash inflow in the form or return of premiums, at the time of maturity, if the Life assured survives the policy term. Thus if you want guaranteed returns of premium from your term insurance policy, you can opt for a term plan with return of premium option.

4. Tax benefits: The premium paid on return of premium term insurance plans is tax-exempt under Section 80C of the Income Tax Act, 1961. A total amount of Rs. 1,50,000 is exempted under the sections. Further, the amount received at maturity period is also tax exempted under the Section 10 (10D) of the Income Tax Act.

5. Surrender Value: If a Life assured surrenders a return of premium term insurance plan, the policy coverage is no longer in place but he/she might receive back a portion of the total premiums paid.

Conclusion

Many customers find Return of premium term insurance plans valuable due to the return of premium feature, in addition to the fact that in case something were to happen to the Life assured, their family still gets the life cover. The benefit of receiving the premiums back provide protection from sunk costs and allows Life assured to build a corpus of savings.

However, it is important for those considering these term insurance plans to carefully choose the right amount of sum assured for having adequate coverage with or without the return of premium. At the same time, it is important to diligently pay term insurance premiums to ensure that one’s life goals are not derailed by unexpected events and circumstances.

Bajaj Allianz Life Videos

Video Icon

Flexi Income Goal – Variants, Features, Benefits Explained

Video Icon

Why Choose Bajaj Allianz Life To Help Get Your #LifeGoalsDone?

Video Icon

#DostiWithDad - Happy Father's Day | Bajaj Allianz Life | Life Goals Done

Video Icon

Covid-19 Survivor Story | Bajaj Allianz Life Smart Protect Goal | Bajaj Allianz Life

Video Icon

Lage Raho India - Keep getting your #LifeGoalsDone

Video Icon

Don’t Let COVID-19 Lockdown Get in The Way of Your #LifeGoals

Video Icon

Coronavirus (COVID-19) Advisory Video #DooriHaiZaroori

Video Icon

Coronavirus COVID-19 impact on markets - CIO Commentary | #KeepCalmStayInvested

Video Icon

Bajaj Allianz Life Leadership Team | #PlankForIndia

Our MD & CEO, Tarun Chugh launches #PlankForIndia campaign and planks with Sanjiv Bajaj MD & CEO, Bajaj Finserv and Chairman Bajaj Allianz Life & the rest of the group leadership team.

Video Icon

#PlankForIndia | Bajaj Allianz Life

Bajaj Allianz Life will contribute to the training and development of India's future sports stars. Come together to Plank for Good Health, PlankforIndia.

Video Icon

#PehlaDinPehlaResolution

#PehlaDinPehlaResolution | Happy New Year | Smart Protect Goal | Bajaj Allianz Life

Video Icon

Bajaj Allianz Life Goal Assure

Bajaj Allianz Life Goal Assure - A ULIP Investment Plan To Achieve Life Goals

Video Icon

Valentine's Day

Valentine's Day

Video Icon

Bajaj Allianz Health Care Goal

A Comprehensive Health Insurance Plan with Critical Illness Cover | Bajaj Allianz Life Health Care Goal

Video Icon

#36SecPlankChallenge video

Promote Healthy Living for a Better Tomorrow with our #36SecPlankChallenge

Contact Us

Bajaj Allianz Life Insurance Company Ltd.

Bajaj Allianz House, Airport Road, Yerawada, Pune - 411 006, Maharashtra

Tel No: 020-66026773

Fax No: 020-66026789

Branch Visit Timings:

Weekdays - 9:00 AM to 3:30 PM

Saturday - 9:00 AM to 12:00 noon

Customer Care Helpline:

1800-209-7272

Monday to Saturday: 9:00 AM to 7:00 PM (IST)

For NRI: +91 20 67871700 (Call charges apply)

Monday to Saturday 9.00 AM to 7.00 PM (IST)

Sales Enquiry Helpline:

1800-209-4040

Monday to Saturday: 9:00 AM to 7:00 PM (IST)

For NRI: +91 20 67688888 (Call charges apply)

Monday to Saturday: 9:00 AM to 7:00 PM (IST)