Money Back Policy Life Insurance is a type of life insurance plan where the policyholder receives a portion of the sum assured at regular intervals (called survival benefits) during the policy term. If the policyholder survives the policy term, they get periodic payments plus the remaining sum assured at maturity. In case of the policyholder’s death during the policy term, the nominee gets the full sum assured.
Benefits of Money Back Policy Life Insurance
| Benefit | Explanation |
|---|---|
| Periodic payouts | Provides liquidity with regular survival benefits. |
| Death benefit | Full sum assured is paid to nominee in case of death. |
| Maturity benefit | Remaining sum assured is paid at the end of term. |
| Savings and protection | Combines insurance and savings in one plan. |
| Loan facility | Policyholders can avail loans against the policy. |
| Tax benefits | Premiums and benefits are tax-exempt under Section 80C and 10(10D). |
Risks of Money Back Policy Life Insurance
| Risk | Explanation |
|---|---|
| Lower returns | Returns may be less compared to other investment options. |
| Premium commitment | Fixed premium payment is required for the full term. |
| Inflation risk | Fixed payouts may lose value over time due to inflation. |
| Partial payouts reduce maturity amount | Survival benefits reduce the lump sum paid at maturity. |
| Surrender penalties | Early withdrawal can lead to loss or penalties. |
Top 10 Money Back Life Insurance Plans in India (2025)
| Plan Name | Insurer | Sum Assured | Policy Term | Survival Benefits | Maturity Benefit | Pros | Cons |
|---|---|---|---|---|---|---|---|
| HDFC Life Sanchay Par Advantage | HDFC Life | Flexible | 10-21 yrs | 20-30% of SA at intervals | Remaining SA + bonuses | Flexible term, good bonuses, regular payouts | Moderate premiums, moderate returns |
| LIC Money Back Policy | LIC | 1L onwards | 12,15,20 yrs | 20% SA every 5 years | Remaining SA + bonuses | Trusted brand, guaranteed payouts | Lower returns compared to ULIPs |
| ICICI Pru Money Back Gold | ICICI Prudential | 1L onwards | 10-25 yrs | Periodic survival payouts | Remaining SA + bonuses | High liquidity, good customer service | Premiums slightly high |
| SBI Life – Smart Money Saver | SBI Life | 1L onwards | 10-20 yrs | Periodic payouts | Remaining SA + bonuses | Flexible options, multiple payout intervals | Moderate returns, limited premium payment modes |
| Max Life Money Back Plan | Max Life | 1L onwards | 10-25 yrs | Survival benefits during term | Remaining SA + bonuses | Affordable premiums, flexible options | No ULIP benefits, traditional plan |
| Bajaj Allianz Smart Money Back | Bajaj Allianz | 1L onwards | 10-25 yrs | Survival benefit payouts | Remaining SA + bonuses | Good claim settlement ratio | Moderate sum assured options |
| Kotak Money Back Plan | Kotak Life | 1L onwards | 10-25 yrs | Survival benefits | Remaining SA + bonuses | Multiple payout options, loan facility | Limited riders |
| Reliance Money Back Plan | Reliance Life | 1L onwards | 10-20 yrs | Survival benefits | Remaining SA + bonuses | Competitive premiums, tax benefits | Limited online services |
| TATA AIA Life Money Back | TATA AIA Life | 1L onwards | 12-25 yrs | Survival benefits | Remaining SA + bonuses | Strong brand, good service network | Slightly higher premium |
| Birla Sun Life Money Back | Birla Sun Life | 1L onwards | 10-20 yrs | Survival benefits | Remaining SA + bonuses | Flexible payout modes | Limited flexibility in premium payment |
FAQ for Money Back Policy Life Insurance
- What happens if I die during the policy term?
Nominee gets full sum assured plus bonuses, irrespective of survival benefits paid. - Are survival benefits taxable?
Usually, survival benefits are tax-free under Section 10(10D) if conditions are met. - Can I surrender the policy before maturity?
Yes, but it may involve surrender charges and lower returns. - Can I avail a loan against this policy?
Yes, most policies allow loans after a certain premium payment period. - Is this policy suitable for long-term savings?
Yes, but better suited if you want periodic payouts along with insurance cover. - What is the minimum sum assured?
Usually ₹1,00,000 but may vary by insurer. - Can I add riders to my money back policy?
Some plans allow adding riders like critical illness, accidental death, etc. - How are bonuses calculated?
Bonuses are declared by insurers annually based on profits and investment performance. - What if I miss a premium payment?
Policies have a grace period; beyond that, the policy can lapse or get discontinued. - Is the premium amount fixed?
Yes, premium generally remains fixed for the policy term.