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Maturity Age of a Term Insurance Policy

Find out about the maturity age of a term insurance policy and how it affects your coverage and benefits.

Maturity age of term insurance policy

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Understanding the maturity age of a Term Insurance policy
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Term Insurance (TI) is the most fundamental and traditional form of life insurance that aims to provide financial protection to the nominees in the event of the untimely demise of the policyholder during the policy term. It is a foremost plan to take care of the needs of one’s dependents. This is especially recommended to the sole breadwinners of a family. You must be aware of certain concepts before purchasing this plan and maturity age (maturity date) is one such concept.

What is the meaning of the maturity age of a Term Insurance policy?
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The maturity age of a Term Insurance policy refers to the date when the financial obligation between the insurer and the policyholder is over. Although uncommon, this may call for some maturity benefits to be paid back to the policyholder at the end of the policy term. This is usually the case with Endowment plans or Term Insurance with a Return of Premium

The main reason that basic Term Insurance lacks maturity benefits is that it does not offer a savings component. It instead offers a life cover at a nominal rate of premium. This can be further enhanced by add-ons/riders which help customise the policy to meet one’s individual needs.

The maturity age in Term Insurance can be better understood with an example.

Rohan purchases a Term Plan for 15 years with a sum insured of Rs. 50 lakhs. He chooses his wife to be the nominee. He pays a nominal premium of Rs. 700 per month. Fortunately, Rohan survives the next 15 years of his policy term. At the end of 15 years, the policy matures without any maturity benefits being paid to him or his wife as he had not opted for a Return of Premiums add-on at the time of the purchase of the policy. In case of Rohan’s death, the amount would have been paid to Rohan’s wife. 

In the case of Term Insurance with a Return of Premium add-on, the maturity age of the insurance policy would call for maturity benefits consisting of the total amount of paid premium. Here, the premiums paid are usually higher as they cover both unforeseen events and investment needs.

Does Term Insurance come with maturity benefits?
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The traditional form of Term Insurance does not offer maturity benefits. If the Term Plan is taken along with the Return of Premium add-on, then the policy has added maturity benefits. This is beneficial in case the policyholder outlives the policy term.

Types of maturity benefits
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Some common types of maturity benefits are as follows.

Accumulated bonuses
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This is an additional bonus that is accrued to the insurance plan over a period of time and paid at maturity or demise.

Terminal bonuses
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It is a form of residual bonus that is declared by the insurer at the maturity of an insurance plan.

Sum assured
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It is a guaranteed fixed amount that the insurer pays to the policyholder‘s beneficiaries at the time of death of the policyholder.

Benefits of Term Insurance with maturity benefits
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Here’s a list of benefits associated with TI with maturity benefits. 

Types of life insurance policies that offer maturity benefits
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Here are some maturity benefits that are offered to the policyholder in case he survives the term of the policy.

Features of Term Plan with maturity benefits
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Some of the features of a Term Plan with maturity benefits are as follows. Note that these are generic and exact details depend upon the chosen plan.

Age limit

18 years to 65 years

Plan type

A spouse can be added to Term plan

Policy  term

5 years to 35 years

Choice of premium payment 



Maturity and/or death benefits

Free look period (time in which the policy can be terminated by the policyholder)

15 days to 30 days depending upon the terms and conditions of the insurer.

Premium paying term

Single pay Limited pay Regular pay

Age at maturity

25 years/ 75 years or whole life

How to choose the best Term Plan 
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Choosing the best Term Plan can be a crucial choice for the financial security of one’s family. There are many plans to choose from in the market but understanding which can provide maximum security requires the following points to be considered before making the purchase.

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Here’s a list of common questions and answers related to maturity age in Term Insurance.


Do all Term Plans have maturity benefits?

No, most Term Plans do not have maturity benefits. However, a Return of Premium rider can offer such benefits. 

What If the policyholder passes away in the international territory?

The nominee of the policyholder is still eligible for a payout after completing the necessary documentation provided the applicable terms and conditions are met.

Is lifestyle an important factor for buying a Term Plan?

Yes, some habits like smoking and drinking are considered before the purchase of the Term Plan. This is because such habits make you more susceptible to developing illnesses in life.

What deaths are covered under a Term Plan?

All kinds of deaths are covered under a Term Plan unless specifically excluded in the policy document. Thus, go through the exclusions carefully.

What are add-ons?

Add-ons, also called riders, cover additional financial emergencies at a low cost. These can be opted for at the time of the purchase of the policy. The choice of riders available may depend on the insurance company.

Can I buy multiple Term Plans from different insurance companies?

Yes, one can purchase multiple Term Plans from different insurance companies.

Why should one buy a Term Insurance plan?

A Term Insurance plan is one of the best life insurance policies to buy early in life. It provides a financial cushion to the family of the policyholder upon policyholder’s death and the premiums paid towards it come at an affordable price. Also, the addition of riders can make a base plan way more robust by increasing the overall cover and financial security.

Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on industry experience and several secondary sources on the internet, and is subject to changes.