The death benefit is payable to the beneficiary of the insured, if he dies during the term of the policy. The death benefit is the total of the sum insured, guaranteed supplements and premiums (if any).
This benefit is payable to the policyholder if the term of the contract expires. This is a guaranteed benefit which is payable as the total of the sum insured, the guaranteed additions and, if applicable, the premiums added to the plan.
The policyholder of a capitalization plan benefits from tax advantages. Premiums paid for the policy are allowed as a deduction from the policyholder’s taxable income. One can also claim a deduction of up to INR 1.5 lakh on premiums already paid. Even plan benefits, maturity or death benefit payments, are exempt from tax under Section 10(10D).
The policyholder can also avail himself of the benefit of the policy loan which is generally up to 80% of the surrender value of the plan. Policy loans available through endowment schemes help meet immediate financial needs at lower interest rates.
Some plans that give premiums to the policyholder, if declared by the insurance company. There may be other types of top-ups that have been added to the plan benefits, such as regular income payments or guaranteed top-ups.