Difference Between Sum Assured and Maturity Amount

What is Sum Assured?

What is the Maturity Amount?

Sum Assured Vs. Maturity Amount

Here are some differences between sum assured and maturity amount:

Parameter Sum Assured Maturity Amount
Definition Sum assured amount is a component of an insurance plan that gives life cover. Customers get an assurance that in case of their premature demise, their families can get this fixed amount and maintain their regular expenses without difficulty. The maturity amount gives individuals a fixed sum of money after their policy term ends. Policyholders can use this benefit as their savings for future expenses.
Beneficiary Only nominees can get this amount in their savings account after the policyholder’s premature death. The insurance companies pay the maturity value to policyholders directly.
Availability The benefit of sum assured comes with term, life and health insurance policies. Policyholders can get maturity amounts only with life insurance plans. Term or health insurance policies do not offer this maturity benefit.
Bonuses Sum assured amount does not include any bonus. Maturity value can include bonuses, as mentioned in the policy terms.

After knowing the differences between sum assured and maturity value, you also need to know about the claim processes for both.

Claim Process for Maturity Benefit

Claim Process for Sum Assured

FAQs about Sum Assured and Maturity Amount

Which documents do I need to submit to claim the maturity benefit?


Following are some of the documents that you need to submit to claim the sum assured amount from an insurance company:

1. Medical records and death certificate of the insured individual

2. Bank account details of the nominee

3. Original policy papers

4. Residential and photo-identity proof of nominees

Are sum assured and death benefits the same?

Death benefit is the total amount a nominee can get after the premature demise of the insured individual. However, death benefits and the sum assured are not the same. Death benefits can be more than or equal to the sum assured amount. It depends on whether the policy includes any riders, type of policy, and other factors.

What is a sum insured?

Sum insured is a policy benefit in general health insurance plans. It gives a maximum cap of policy coverage which you can claim if you meet its inclusion criteria. For example, if the sum insured amount is ₹ 2 Lakh, you can claim up to ₹ 2 Lakh, not more than that.

Does a beneficiary need to pay any tax on the death benefit?

According to Section 10(10D) of the Income Tax Act of India, a beneficiary will not pay any tax on the sum assured. The entire amount will be free from any tax obligations if the total premium amount is lower than 10% of the sum assured and the policy is purchased after 1 April 2022. If the date of issuance is before 1 April 2012, the threshold of the total paid premium is 20%.