Buy a zero-cost term plan if you are keen on a return, say experts

Sanjay Kumar Singh

Some customers buy a term plan with longer tenure (even though they are more expensive) for estate planning.

Two types of term insurance plans have been available in the market so far. One is the plain-vanilla plan where if a person dies during the policy term, his beneficiary receives the death benefit. If he survives, he gets nothing.

The second is the return-of-premium (ROP) term plan.

The essential difference between these plans is that in the latter if the insured survives the policy term, he gets back all the premiums he has paid.

ROP plans are about twice as expensive as pure term plans.

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