If you have survived your life insurance policy tenure and have paid your premiums on time then you are entitled to receive a maturity benefit. However, note that not all life plans offer maturity benefits. Most term plans do not have any maturity benefits. 

Maturity benefits is sum assured + bonuses declared for the policy years + final additional bonus if any. On the other hand if the policyholder couldn’t make it till the end of the policy then the nominee will receive a sum assured amount as the death benefit.

Example on how to calculate maturity benefit

Sum Assured = Rs. 5 Lakhs

Policy term = 20 years.  

Mr.X survives till the end of the policy tenure then he is eligible to receive the maturity benefits if he had paid his premiums on time.

Other Assumptions:

Simple Reversionary Bonus declared every year = Rs. 45 per 1000 Sum Assured. That is a bonus of 45 x (5,00,000/1,000) = Rs. 22,500 every year. Please note that there is no guarantee on bonus rates. It could be higher or lower every year.

Final Addition Bonus = Rs. 20 per 1000 Sum Assured. So a Final Addition Bonus of 20 x (5,00,000/1,000) = Rs. 10,000 when the policy ends.

The sum assured of Rs. 5 Lakhs with the simple reversionary bonuses and any final bonus declared by the company would be paid.

Mr.X  gets -  sum assured + bonuses declared for 20 years + final additional bonus if any. That is the calculation of the Maturity Amount of Rs. 5,00,000 + (Rs. 22,500 x 20) + Rs. 10,000 = Rs. 9,60,000.