Calculators LIC plans Term plans
Newer term plan with return-of-premium option.
LIC Bima Kavach (Plan 879) is a pure-term plan with an optional Return-of-Premium (ROP) variant. Without ROP, it is a standard level-SA term plan (entry age 18–65, SA from ₹50 lakh, term 10–35 years, regular pay). With ROP elected, LIC refunds 100% of the total premiums paid if you survive to the policy's maturity date. The ROP option costs roughly 40–60% more in annual premium. The critical question every buyer should ask before choosing ROP: can I do better by investing the extra premium myself at a realistic return?
ROP option returns 100% of premiums at maturity. Adds roughly 40–60% to base premium.
Death of the life assured during the policy term — full SA paid as lump sum to nominee, regardless of whether ROP was elected. With ROP: if the life assured survives to maturity, 100% of total premiums paid (base premium only, not rider premiums) are returned as a maturity benefit. The base protection function is identical to any other level-SA term plan.
Suicide in the first 12 months. Death after lapse. Non-disclosure. With ROP: if the policy lapses at any point before maturity (even briefly), the ROP benefit may be forfeited — check the policy document. ROP applies only to base premiums; rider premiums are not returned. If you surrender the policy before maturity, you get the surrender value, not the accumulated premiums.
Several private insurers also offer ROP term plans — HDFC Click 2 Protect Return of Premium, Max Life Smart Secure Plus with ROP option. Compare the total premium (not just annual) and the ROP amount (always 100% of premiums paid). The comparison is straightforward: for the same SA, term, and age, the cheapest ROP plan wins — because the return mechanism is identical across all of them (100% premium refund at maturity).
Here is the math for a 30-year-old, ₹1 crore SA, 30-year term. Bima Kavach without ROP: approximately ₹12,000/year. Bima Kavach with ROP: approximately ₹18,000–20,000/year. Extra annual outgo for ROP: roughly ₹7,000/year. At maturity, LIC returns 100% × 30 years × ₹19,000 ≈ ₹5.7 lakh. Now run the alternative: invest ₹7,000/year in a debt mutual fund at 7% CAGR for 30 years → terminal value approximately ₹7.0 lakh. At 9% (balanced fund): approximately ₹9.8 lakh. At 11% (equity index): approximately ₹13.7 lakh. In every scenario above a 5% return, investing the extra premium yourself beats the ROP payout. The ROP is essentially a 4–5% guaranteed return on the incremental premium — decent if you are in a low-risk-tolerance situation and genuinely cannot commit to a separate investment. Weak if you have even moderate investment discipline.
Bima Kavach without ROP: buyers who want a reliable regular-pay term plan from LIC and whose quote comparison does not clearly favour Digi Term or New Tech-Term for their specific age/term. Bima Kavach with ROP: the mathematically defensible case is narrow — a buyer who (a) has already maxed out other investment avenues, (b) genuinely cannot maintain SIP discipline for 30 years, and (c) values the psychological certainty of getting premiums back over the expected-value advantage of investing separately. In practice, ROP is often sold on emotion ('at least you get something back') rather than analysis. If your financial planner recommends ROP over a plain term plan without showing you the opportunity cost calculation, ask for the numbers.
Base premiums deductible under §80C (up to ₹1.5L/year). Death benefit tax-free under §10(10D). ROP maturity benefit: tax-free under §10(10D) if the sum assured is at least 10× annual premium — Bima Kavach easily satisfies this. If you have elected ROP, the maturity payout is the premium refund — this is tax-free, not taxable income. Rider premiums (CI, ADDB) deductible under §80D and §80C respectively, in addition to the base premium deduction.
LIC does have an online premium calculator — it's their Quick Quote tool on the eBiz portal. Enter your name, date of birth, gender, and mobile number, then pick this plan on the next screen to see the actual premium for your profile.
Open LIC's Quick Quote tool ↗Or browse the official plan page ↗ for brochures and policy documents.
Asymmetrica isn't an insurance advisor. The analysis above is editorial, sourced from published LIC brochures. Verify eligibility, current rates, and plan-specific conditions with LIC or a licensed advisor before purchasing.
Last updated · site changelog