Insurance plans have gained a lot of momentum in recent years. With access to the internet, people are becoming aware of the available options and can now make smarter choices. Based on the requirements, priorities, and budget, they can choose suitable plans as per their needs. With various insurance plans available in the market, the latest one that has attracted popularity is TROP (Term Plan with Return of Premium).
Keep reading as we unfold about the TROP and its benefits.
What is Term Plan with Return of Premium?
TROP is the specially designed variant of the term insurance plans that cater according to insurance seekers' needs. However, like any other term insurance plan, it provides financial security to your loved ones and family in case of any eventuality.
The distinct feature of TROP lies in the policy tenure. If we talk about standard term insurance plans, the policyholder cannot access the policy's claim if they survive the policy tenure period. Contrary to this, TROP returns the policyholder's premiums over the years if he or she outlives the policy tenure. This is one of the primary reasons for the massive popularity of this pan, as it is ideal, affordable life insurance that returns something at the time of maturity.
Benefits of Buying TROP (Term Plan with Return of Premium):
1. Return of Premium:
It is the most significant selling point of this term plan. Securing your family's future and finances is the ultimate objective of your life. This plan is the same as any other standard term insurance plan with one major difference as under TROP Plan – Survival benefits are Offered to the policyholders at the end of the policy term. It promises to return all your money you have paid as premiums for the plan less any taxes. A feature that is not available in the standard term plans. And you make sure to buy such a plan that fulfills all the future requirements of your family.
2. Highly Affordable:
The biggest concern is affordability for policy seekers while looking out for suitable term plans. While TROP can cost you more than the standard term plans, but they are still less expensive than the other available plans such as whole life insurance, endowment plans, and Unit Linked Insurance Plans (ULIPs). This qualifies as another factor to be popular among people. The affordability makes it an ideal voice for every age group of people, even those who have just started their jobs.
3. Optional Riders:
Riders come with additional benefits. Ad TROP provides you with the option of extending its benefits by purchasing optional riders or add-ons. TROP assures you of returning your premiums once the policy tenure is over. In addition to this, passengers can provide you coverage for things that are not covered under TROP, making it an ultimate combination for the policyholder.
4. Tax Benefits:
Who doesn't want to save on taxes? Everybody! And TROP makes you eligible for tax deductions. According to Section 80C of the IT Act, if a policyholder pays premiums of up to 1.5 lakh towards a life insurance policy in a fiscal year, they become eligible for tax benefits.
5. Paid-up Value:
Suppose customers default Premium payment and policy lapses without being revived, instead of ceasing the cover. In that case, the insurers reduce the death benefits to suit the premium paid & continue life cover till the policy term expires.
Who Can Avail Term Plan with Return of Premiums?
TROP's minimum entry age is 21 years, and the maximum entry age is 55 years. The rate of the various premium of the policy is decided according to the policy seeker's age. Everybody can avail term plan with Return of Premiums. A term plan with a return of premiums provides a cover that lasts for a significant amount of time, varying from 10, 15, 20, 25, or 30 years. In most of the plans, the maximum maturity age is below 70 years, but some insurance providers offer cover even beyond 70 years.
Is TROP right for you?
The term plan with return of premium is an optimum choice for any individual. Everybody wants profits from investments. Paying premiums for the term insurance plans is a type of investment where you secure your loved ones' future and finances. With TROP available in the market, it provides you with a bonus of returns. All your premiums will be returned once the policy matures, which technically makes it free of cost.