Term insurance is the most preferred life insurance plan because of its characteristics. The plan offers substantially greater benefits at possibly lowest premiums for a specific tenure. Though term insurance doesn’t provide any survival or maturity benefits, the plan has been trending since long ago. But, in the past few years, the need for maturity benefits has been seen majorly when the affordable plans such as term insurance are considered. Therefore, the insurance companies come up with the term plan that offers maturity benefits too. Such plans are labelled as Term Return of Premium plans. Following are a few reasons why you should buy term return of premium policies.
You Get the Premiums Back If the life insured survives the policy tenure, there has to be something that he gets back at the end of the term. TROP helps you precisely in the same way. The total amount of premiums paid till maturity is paid back to the policyholder as maturity benefit. In short, availing the term plan at a slightly higher price may give you both death as well as maturity benefits. Flexibility You have a provision to choose the mode of your premium payment such as annual, semi-annual, quarterly, or monthly. The mode of the premium payment has to be decided at the commencement of the policy. Most of the insurers also provide single premium payment provision, which comes at comparatively lesser price than other modes. Another flexibility is the online availability of the play and premium payment. Riders If you feel that the term return of premium plan is not providing the life cover for a particular event, you can choose from the available list of riders. These are nothing but add-on features that allow you to gain coverage against the events like accidental death, permanent or partial physical disability, hospital cash expenses and so on. Tax benefits Term Return of Premium plans also offer tax benefits, similar to other life insurance plans, under Section 80C and Section 10(10D) of the Income Tax Act. The exemption can be availed on both the benefits as well as on the premiums paid towards the policy. In short, the term return of premium policy is nothing but the extended version of regular term plans that allow you avail both death as well as maturity benefits. Now, you need not worry about the maturity benefits if you survive the policy tenure by a good fortune.
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February 2022
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