- 100% Premiums Back
- Best TROP Plans
- Benefits Offered
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Updated on Mar 07, 2025 8 min read
What is a Term Insurance with a Return of Premium (TROP)?
A term insurance with a return of premium (TROP) is a term insurance plan that returns all the premiums excluding GST in case the policyholder survives the policy tenure. The return of the premium feature makes it different from a basic term plan. A pure term plan only offers death benefits while a TROP offers death benefits as well as maturity benefits.
The premiums of a term plan with a return of premium are higher than a pure term plan as your premiums are returned at the end of the policy tenure. Some additional benefits associated with TROP include partial or full disability benefits, accidental death benefits, and guaranteed protections against critical illnesses. TROP can bring a sense of overall protection with dual benefits under a single-term plan.
How Does Term Insurance Plan with Return of Premium Work?
It’s important to understand how a term plan with a return of premium works so that you can make the right financial decision. In case the policyholder dies during the policy tenure his family would receive the death benefits. However, if he/she survives the policy tenure, all the premiums paid are returned in the form of maturity benefits.
Let’s understand how a term plan with a return of premium works with a simple premium illustration:
- Bhanu is a 25-year-old man living a healthy life with no alcohol or pre-existing medical problems and wants to secure his life with a term plan. However, he wants all his premiums back in case he survives the policy tenure.
- He buys a return of the premium term plan with a sum assured of Rs. 40 lakhs.
- The yearly premium for his plan is Rs. 14,000 for a policy tenure of 50 years.
- If Bhanu passes away during the policy term, the nominee will get Rs. 40 lakhs sum assured.
- If Bhanu survives the policy tenure, he will receive all his premiums back (Rs 14000x 50= Rs 7,00,000) on the maturity date.
Best Term Plan with Return of Premium in 2025
We have provided a list of best term insurance plans with a return of premium in 2025. You can consider these plans for buying.
| Name of the Plan | Entry Age | Maturity Age | Unique Features |
| ICICI Pru iProtect Return of Premium | 18 to 65 years | 85 years | Return of premium with Life Stage Cover, Online discount, Flexible premium payment methods |
| Axis Max Life Smart Secure Plus Plan | 18 to 65 years | 85 years | Premium break option, Special exit value, Terminal illness cover |
| Bajaj Allianz Life eTouch Online Term Plan | 18 to 65 years | 75 years | Premium holiday option, Extra payout in case of death due to accident, Choose how your family receives death benefits |
| PNB MetLife Mera Term Plan Plus | 18 to 65 years | 99 years | Spouse cover protection, Choice of plan option, Options to enhance cover with riders |
| Canara HSBC iSelect Smart360 Term Plan | 18 to 65 years | 81 years | Child care benefit, Life stage benefit, Spouse cover |
| ABSLI DigiShield Plan | 18 to 65 years | 55 years | Flexible premium payment term, Rider options to choose from, Inbuilt terminal illness cover |
What are the Features of a Term Insurance with Return of Premium?
Here are some features of a term plan with a return of premium option:
Death Benefits
In case of the policyholder’s uncertain demise during the policy tenure, death benefits are paid to the policyholder’s family to fulfil their financial goals.Multiple Premium Payment Options
Term insurance with return of premiums offers multiple premium payment options including regular pay (premium payment till policy tenure), limited pay (premium payment for limited tenure), or one-time pay (entire premium is paid in one shot).Maturity Benefits
If the policyholder survives the policy tenure, maturity benefits or total premiums paid are returned at the maturity date.Level Premiums
Your premiums under the TROP plan remain the same throughout the policy tenure. It helps you pre-plan your finances as per your life goals.Surrender Value
Term Life Insurance with Return of Premium provides you an option to surrender your policy and avail a surrender value if you are not satisfied with the same. The surrender value paid is higher than the guaranteed surrender value or special surrender value.
pert Insights
People generally think about how insurance companies are earning from term insurance with return of premiums plans. They have to return all the premiums if the policyholder survives the policy tenure. The amount returned by insurance companies to policyholders is not adjusted for inflation. Insurance companies earn money by investing premiums received in various assets. You must choose the right term insurance plan after carefully considering the pros and cons of each plan.
Benefits of Term Insurance with Return of Premium
Term insurance with a return of premium offers multiple benefits to the policyholders. You must consider this while making a buying decision.
Return on Premium Paid
Return of Premium Term Life Insurance pays back all your premiums if you survive the policy tenure.Tax Benefits
The premiums paid for a return of premium term life insurance are eligible for tax exemption up to Rs 1.5 lakhs under Section 80 (C) of the Income Tax Act, 1961. Moreover, the death benefits received are completely tax-free under Section 10 (10D).Additional Rider Benefits
To enhance your coverage, you can choose additional rider benefits with your term plan with a return of premium, such as an accidental disability rider or a critical illness rider.
Who Should Buy Term Plans with Return Of Premium?
The following individuals should consider buying a term insurance plan with a return of premium:
Unmarried individuals
A person with no dependents such as a wife or kids should consider buying a TROP plan as it’s like an investment that provides benefits on policy maturity.Individuals with no long-term responsibilities
If a person knows that he/she will have no responsibilities during old age such as a loan or burden of kids’ education or wedding then they can go for the return of premium term insurance plan.Married with kids
Term Insurance Return of Premium can be useful for those individuals who have a huge set of responsibilities and are aware that they might need money after 40-50 years of duration. The premium received back in the form of a maturity benefit can help them survive that crucial time.
Pure Term Insurance Vs. Term Plan with Return of Premium (TROP)
Pure term insurance and the return of premium are two different variants of term insurance that come with different benefits and limitations. Sometimes it becomes difficult to understand which one is right for you. So, we’ve simplified the comparison between pure termthan insurance and the return of premium to help buyers end their confusion.
| Parameters | Pure Term Insurance Plan | Term Plan with Return of Premium (TROP) |
| Definition | A pure term insurance plan offers death benefits in case of the policyholder’s uncertain death during the policy tenure. No maturity benefits are paid in case the policyholder survives the policy tenure. | It is one of the variants of term insurance where the policyholder receives life coverage for a specific term. Under this plan, the insured receives death and maturity benefits whichever comes earlier. |
| Surrender | If policyholder surrenders their policy before the tenure, their life cover will end and they will receive nothing. | If policyholder surrenders their policy before the tenure, their life cover will end and they will get a small amount of the premium paid in the form of surrender value. |
| Tax Benefits | The premiums paid for term insurance are eligible for tax exemption up to Rs 1.5 lakhs under Section 80 (C) and the death benefits received are tax-free under Section 10 (10D) of the Income Tax Act, 1961. | The premiums paid are eligible for tax exemption up to Rs 1.5 lakhs under Section 80 (C). Death benefits and maturity benefits are tax-free under Section 10(10D). |
| Cons | No maturity benefits will be paid if the policyholder survives the policy tenure. | The premiums are expensive as compared to the basic term plan. But you’ll receive a refund of all the premiums paid if you outlive the policy tenure. |
| Why should you buy it? | To protect your family members financially in case of your demise so your loved ones can freely manage their finances in your absence. | If you’re living a healthy lifestyle with no medical history or harmful addiction, then you should consider buying a term insurance plan with a return of premium. |
Conclusion
Term Insurance with a Return of Premium is a great option for anyone looking for financial safety along with a return on their investment. This plan is a win-win situation for policyholders as they will surely receive either death benefits or maturity benefits. We have also provided a list of best term insurance plans with return of premium that you can consider for buying.
If you are still confused about whether TROP is right for you or not, you can contact us at PolicyX.com. One of our insurance experts will reach you shortly and help you choose a plan that best suits your needs.
We offer No Spam, No Gimmicks, and Only Expert Insurance Advice.
FAQs: Term Insurance Return of Premium
1. Is it good to buy term insurance with a Return of Premium?
Yes, term insurance with a return on premium is a good choice if you want to enjoy the dual benefits of financial coverage and return on your investment.
2. What is term insurance with a refund of the premium?
Term insurance with a refund of the premium offers financial coverage in case of the policyholder’s uncertain death during the tenure. In case the policyholder survives he/she will receive the premiums back.
3. What is a term life insurance that returns a premium?
TROP (Term insurance with return of premiums) is a type of term life insurance that returns premiums in case the policyholder survives the policy tenure.
4. Is there any term insurance with a Return of Premium in LIC?
The policyholders who wish to get a return on premiums should buy the LIC Return of Premium term plan.
5. What is term insurance with a return of premium calculator?
Term insurance with a return of premium calculator is an online tool that helps you calculate the premiums for your term insurance plan.
6. Which is the best term insurance with a return of premium?
There are various best term insurance plans with a return of premium including ICICI Pru iProtect Return of Premium, Axis Max Life Smart Secure Plus Plan, Bajaj Allianz Life eTouch Online Term Plan, PNB MetLife Mera Term Plan Plus, Canara HSBC iSelect Smart360 Term Plan, etc.
Other Term Insurance Companies
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Written By: Himanshu Kumar
Himanshu is a seasoned content writer specializing in keeping readers engaged with the insurance industry, term and life insurance developments, etc. With an experience of 2 years in insurance and HR tech, Himanshu simplifies the insurance information and it is completely visible in his content pieces. He believes in making the content understandable to any common man.
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