In the context of life and living benefits insurance, “return of premium on death (ROPD)” is a feature that ensures the policyholder’s beneficiaries receive a refund of premiums paid (all or part, depending on the policy) if the insured person dies while the policy is active. This refund is in addition to any death benefit that may be payable under the policy.
Key aspects of return of premium on death (ROPD) include:
Premium refund
Beneficiaries receive some percentage of (or all) premiums paid upon the insured’s death.
Additional benefit
The refund is provided in addition to the policy’s death benefit.
Policy condition
The policy must be active at the time of the insured’s death. Depending on the policy, the refund is often not paid if a critical illness claim has been paid.