For instance, suppose your life insurance policy will likely expire on December 31, 2024. The insurer offers an interim Bonus on plans which are mature or which are claimed within two bonus announcement dates. Interim Bonus:Īn interim bonus is accrued in a life insurance policy. Now, the insurer offers a simple reversionary bonus of 5% on the assured sum, which makes you eligible for INR 25,000 as a simple reversionary bonus every year.

Suppose you have a life insurance policy of INR 5 lakh as the sum assured. Let’s understand it with the help of an example. Or it can be claimed by the policyholder’s nominee after the insured person’s death. However, the amount received under a simple reversionary bonus can be claimed by the policyholder only at the time of maturity. The insurer declares this bonus every year at the end of the financial year. Simple Reversionary Bonus:Ī simple reversionary bonus is a kind of bonus that is calculated as a percentage of the sum assured in terms of the basic policy benefit. There are five types of bonuses that a policyholder can avail of under a life insurance policy. Types of Bonuses in Life Insurance Policies Bonuses are not guaranteed benefits and are offered to policyholders of specific plans, such as participating life insurance plans, among others. Later, this wealth is distributed among the eligible policyholders as a bonus. Such investments help the insurer to create wealth. This asset pool helps the insurer in settling claims, and the insurer further invests them in numerous bonds, debts, securities, etc. The complete premiums paid by you create a pool of assets for the insurance company. When you buy a life insurance policy, you pay premiums to your insurer, and in return, you get life coverage. As a fixed amount paid per 1000 INR of your sum assuredĪ bonus in life insurance is a sum accumulated by a policyholder on an annual basis. How Are Life Insurance Bonuses Calculated?.Types of Bonuses in Life Insurance Policies.

Different bonus types