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Term Plan with Return of Premium: What Benefits Does it Offer?

dateKnowledge Centre Team dateFebruary 15, 2021 views115 Views
Term Plan with Return of Premium: What Benefits Does it Offer?

Term insurance plans have become very important in today's world. Who doesn't want financial security for their families? They help you to fulfil the future dreams of your family without any worry about financial resources. It enables you to keep your family needs secure even when you are not around.

What is a term Insurance plan?

A Term Insurance plan is a plan that provides coverage for a particular period of year or term. And in case of any unfortunate event with the policyholder, it provides death benefits to the beneficiaries. It also offers various benefits, such as survival benefits, maturity benefits, tax benefits, and many more. However, this can depend on the plan chosen.

Canara HSBC Oriental Bank Of Commerce Life Insurance offers various term insurance plans with several benefits. You can choose any of them based on your preferences and requirements.

Types of Term Plans by Canara HSBC Oriental Bank Of Commerce Life Insurance

  • Select Star Term Plan

    This plan by Canara HSBC Oriental Bank Of Commerce Life Insurance offers various advantages such as complete life coverage, covering a spouse in the same policy, multiple premium payments options, and many more. It also provides a return of premium benefit according to which all your premiums will be returned once you outlive the policy tenure.

Cover options under this plan are:

  • Plan Option Life

    In this, the sum assured on death is payable, and the policy terminates upon payment of the benefit. However, both the life assured and spouse can be covered for the term of the contract subject to the policy's terms and conditions.

  • Plan Option Life With Return of premium

    In this, the sum assured on death is payable, in case of death or on terminal illness diagnosis during the policy term. The total premium paid by you at maturity will be returned if the policy term is outlived and then the policy terminates.

  • Plan Option Life Plus

    This option under iSelect Star Term Plan, the sum assured on death is payable, in case of death or on terminal illness diagnosis during the policy term and the policy terminates. And the total premiums paid will be refunded on the date of maturity in case of survival till maturity, and the policy will continue to extend till you attain 99 years of age. Sum assured you would be paid in case of death or diagnosis of a terminal illness. On attaining 99 years sum assured will be paid and the policy will be terminated.

Product Parameters

Age at entry

Minimum 18 years
Maximum 65 years

For PPT up to the age of 60 years (under plan option life ) - 55 years.

For PPT up to the age of 60 years (under other plan options) - 50 years.

And for a single premium option - 45 years.

For non working spouses - 50 years.

Age at maturity

Minimum 28 years
Maximum 80 years

For the whole life coverage under plan option life - 99 years

For ADB or ATPD - 75 years

However, these options are not available if you have opted for spouse coverage.

Policy term

Parameters Minimum Maximum
Policy term (subject to maximum maturity age) Plan option life - 5 years

Other plan option - 10 years
Plan Option Life -62 years This is not available for whole life coverage. It will be fixed at 99 minus age at entry in it.

Other plan options - 30 years.

Premium payment term

Life Single premium (not available for whole life coverage)

Limited Pay - Choose between 5/10/15/20/25 up to age 60 years

Regular pay - Equal to the policy term
Life with the return of premiums Limited Pay - Choose between 10/ 15/ 20/ 25 / up to age 60 years

Regular Pay - Equal to the Policy Term
Life plus Limited Pay - Choose between 10/ 15/ 20/ 25 / up to age 60 years

Regular Pay - Equal to the Policy Term

Sum Assured

Parameters Minimum Maximum
Sum assured Plan Option Life – Rs. 25,00,000*

Optional In-Built Covers – Rs. 25,00,000

Other Plan Options – Rs. 15,00,000
As per Board Approved Underwriting Policy (BAUP)

For ADB – Rs. 3,00,00,000

For ATPD PPP – Rs. 1,00,00,000

For non-Working Spouse – Rs. 25,00,000

How does the plan work?

You can alter your plan according to your insurance requirements.

Life Option:

Step 1: Choose one of the Coverage Options as per your Life Insurance needs - Level or Increasing.

Step 2: Choose any of the Optional In-built Covers according to your Life Insurance needs.

Step 3: To cover spouse, choose any one of the Benefit Payout Options at the time of point of sale.

Step 4: For the Part Lumpsum and Part Monthly Income, you can select the proportion 25% / 75%, 50% / 50% and 75% / 25%.

Within Monthly Income, select level / increasing (@ 5% p.a. or @ 10% p.a.) Monthly Income and select to receive it in equal monthly instalments over 120 months or till the end of the Policy Term or 40 years, whichever is ahead.

However, only the Lump Sum option is available in the Whole Life Coverage under Life Plan Option.

Life With Return of premium

Step 1: Choose any one of the Benefit Payout Options at the time of point of sale.

Step 2: For the Part Lumpsum and Part Monthly Income, you can select the proportion 25% / 75%, 50% / 50% and 75% / 25%.

Within Monthly Income, select level / increasing (@ 5% p.a. or @ 10% p.a.) Monthly Income and select to receive it in equal monthly instalments over 120 months or till the end of the Policy Term or 40 years, whichever is ahead.

Life Plus

For the Part Lump Sum and Monthly Income, you can select the proportion 25% / 75%, 50% / 50% and 75% / 25%.

Within Monthly Income, select level / increasing (@ 5% p.a. or @ 10% p.a.) Monthly Income and select to receive it in equal monthly instalments over 120 months or till the end of the Policy Term or 40 years, whichever comes before.

Once you have personalized the plan based on your need, select other details like Sum Assured, Policy Term, Premium Payment Term, and Premium Payment Mode. Then, answer certain questions about yourself and provide other basic details.

POS - Easy Bima Plan

POS - Easy Bima Plan is a term insurance plan that provides a return of premium on the date of maturity. The advantage of choosing this plan is that it provides affordable and hassle-free protection to help you give financial security to your family's needs. Thus, a complete package to secure your family's future dreams with sufficient financial resources.

Benefits of POS - Easy Bima Plan

This plan provides various benefits as given below:

  • Death Benefit Payable (Other than accidental death)

    In the case of death in the waiting term, which means 90 days from the date of commencement, you will be given a return of the total premiums paid. And in case of the waiting term that is after 90 days from the date of commencement, you will get 100 per cent of death benefits sum assured. However, on payment of death benefits, the policy will stand terminated, and no further benefits will be payable.

  • The death benefit payable (in case of accidental death)

    The waiting period is not applicable in this case. In this, an accidental death benefit sum assured in addition to the death benefit sum assured will be given. After this, the policy will stand terminated, and no further benefits will be payable.

    Also, the accidental death benefit sum assured is equal to the death benefit, and for more details, you may check the terms and policies under this plan.

Return of premium on date of maturity

In case of survival till maturity, the Return of the total premiums paid shall be payable, provided the policy is still in force.

Tax benefits

According to Section 80C of Income Tax Act, 1961, you can get tax benefit on the premium paid.

How does this plan work?

This plan is quite simple, and you can customise the policy according to your financial goals and requirements. There are two steps.

Step 1: Select your sum assured.

In this, you need to ensure that your financial needs are met and accordingly choose a death benefit sum assured. However, it has to be in Rs 50,000.

Step 2: Now, select your premium payment term and policy term.

There are various premium payment terms and policy terms offered (as described below), and you can choose according to your requirements.

Age criteria

Entry age

Minimum 18 years
Maximum 55 years

Maturity age

Minimum 28 years
Maximum 65 years

Premium Payment and Policy Term

There are various options present to help you select the best term plan. You can choose according to your preferences and requirements.

Policy term - 10 years and 5 pay

Policy term - 15 years and 10 pay

Policy term - 20 years and 10 pay

Sum Assured

The minimum sum assured with this plan is Rs 50,000.

The maximum sum assured with this plan is Rs 15,00,000.

Annual Premium options

The minimum premium you can pay are as follows:

Policy Term of 10 year - 2,219

Policy Term of 15 year - 1,076

Policy Term of 20 year - 989

The maximum premium you can pay is as follows: there is no limit.

This depends on the chosen sum assured.

Premium Payment Mode And Modal Factors

It is available in annual as well as monthly mode. However, the annual premium needs to be multiplied with a factor of 0.10 to arrive at the monthly instalment premium payable.

The Bottom Line

Term insurance plans have become a necessity in today's world. They help provide you and your family with financial security to have a safe and secure future. Canara HSBC Oriental Bank Of Commerce Life Insurance offers various term insurance plans that you can choose according to your preferences and requirements.

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Annual Income (In Lacs)

Our Products

TERM Insurance PLAN

TERM Insurance PLAN

Whole life cover option available

Increase your life cover with changing life stages

Return of premium & in-built protection options

Multiple premium payment options

Avail tax benefits on premiums paid as per tax laws

ULIP PLAN

Unit Linked Insurance Plan

8 funds and 4 portfolio strategies to invest

Loyalty additions and wealth booster

Return of Mortality Charge is available on Maturity under all three cover Options

Flexibility of switching between the fund options to take benefits of market movements or change in risk preference

Pos Easy Bima Plan

Top Benefits

Hassle free

Get double life cover in case of accidental death

Choice of flexible premium payment and policy term

Avail tax benefit on premium paid

Frequently Asked Questions (FAQs) for Term Insurance

This being a term plan doesn't offer any payout after maturity or expiration date.

Each insurance company has its own term insurance premium calculator. If you want to check out the premium quote, go for the iSelect Star term plan calculator. It gives a premium amount based on your age, gender, habits, education, and annual income.

You can purchase an iSelect Star term plan anytime between 18 to 70 years of age.

It depends on your needs. For example, if you want to cover a child's education or wedding expenses, you have to include them in your coverage. Your premium will be calculated accordingly.

If your key purpose is to give your Family financial protection, go for the term insurance plan. And if you want some savings, in the end, go for a traditional life insurance plan.

Go for at least 12 times cover than your annual income. Or you can go as far as 20 times coverage as per your needs.

The right time is when you don't have anything to keep your Family safe from financial storms, and they rely on you for financial needs.

If you are unable to make the payment or suffering from a terminal illness, a term plan pays a part of the sum insured to treat your disease.

Term insurance riders are attachment or endorsements made, while taking the term insurance policy, as a supplementary coverage to policyholders. Apart from the core death benefit, term insurance riders offer below-given additional benefits:

  • Accidental Death Rider When a person suffers from a terminal illness, his/her family ends up spending a significant amount in treatment and medical expenses. Accelerated death rider pays a part of the sum insured in advance to cover such costs and save the family from running out of cash.
  • Accidental Disability Rider If the policyholder can't pay the premium because of an accident or permanent disability, a sudden disability this pays the premium on behalf of the policyholder till completion of policy term or for a defined duration.
  • Critical Illness Rider If the insured person gets a heart attack, cancer, or any other critical illness, this rider pays a lump sum on valid diagnosis.
  • Premium Waiver Rider If the policyholder is unable to make payments due to income loss or disability, a premium waiver rider waives off all future premium payments. And the term policy remains active until the expiration date.
  • Income Rider: The rider ensures that your family receives regular income + sum insured in case of unfortunate demise of life insured.

Anyone can go for life insurance as it offers some savings after the maturity date, but it doesn't cover the protection of your family . The best term insurance plan is solely designed for taking care of loved ones if something happens to you. Term plans act as a shield between your family and sudden financial fall. They make sure that your family lives a healthy life even after you. With a little amount paid per year, you can be worry-free from the family's financial conditions.

Questions that you need to ask while buying Term Insurance?

  1. 1. Amount of premium you have to pay based on your age, habits, education, and monthly income
  2. 2. The total number of benefits covered in the term plan. Do they include benefits that you care about the most?
  3. 3. How to save money on tax if you pay for the term plan?
  4. 4. Do they offer regular income options?
  5. 5. Can you change the coverage and premium in the future?
  6. 6. Does the claim consider valid if death occurs outside India?
  7. 7. Which kind of death is not covered by insurance?
  8. 8. Can NRIs take term insurance? If yes, what are the conditions?
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