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Features of a Money-Back Plan

Updated On Apr 23, 2021

Money back plans are a unique type of life insurance plan, these plans promise to provide you regular payout of a certain amount which is decided at the time of policy issuance. These periodical payout are made through the policy term and are equivalent to a certain percentage of the sum assured. Under a money back plan sum assured is provided to the nominee irrespective of periodical payouts made, in case of an unforeseen demise of the life assured. 

Also Read:- Difference Between Money Back and Term Insurance Plans

Features of Money-Back Policy

Following are some of the key features of a money-back policy:

1. Income During the Policy Term

Money-back life insurance plans are known to provide periodical payouts at a percentage of the total sum assured during the policy term in regular intervals. These payouts are known as survival benefits and will be provided only when the premiums are paid regularly and the policy is still in force. The amount received on the regular intervals can act as an income source for the policyholder and his/her family members.

2. Maturity Benefits

On the maturity date of the money-back life insurance plan, the life assured is entitled to receive the total sum assured along with an additional bonus declared on the plan, after deducting the amount received on the fixed intervals during the policy term. 

3. Death Benefits

Under the money-back life insurance plan, in case of an unforeseen demise of the life assured during the policy tenure the nominee is entitled to receive the total sum assured, even if the policyholder has already received periodical amounts on fixed intervals. The death benefit consists of the total sum assured amount along with additional bonus declared upon the plan irrespective of periodical payout made earlier to the life assured during the policy term.

4. Bonus

Money-back plans are usually participating life insurance plans where the insurance company provides a bonus amount as a pre-decided percentage of the total sum assured amount, to the policyholder. The bonus is provided to the life on when he/she makes regular premium payments and the policy is still in force. 

5. Additional Riders

Riders are additional coverage that the one can purchase at the time of policy issuance to enhance the cover under the policy. The lie assured can choose to add any rider available under a money-back plan. Common life insurance riders available under money back-plans are Accidental death benefit, Accidental permanent disability, Total & partial disability benefit, Hospital cash benefit, Waiver of premium benefit, Critical illness benefit, etc.

You May Also Like to Read:- Is Money Back Policy Good Investment Option

Tips to Choose Best Money Back Plan


Money-back plans serve the dual purpose of providing life insurance along a savings opportunity. This type of plan offers survival, maturity and death benefit. Other than just being a life insurance plan this plan helps you ensure you have financial resources to overcome your expenses at different stages of life.

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