Introduction
Term insurance is a crucial financial safety net for families, providing financial security to the policyholder’s family in the event of policyholder’s demise. Choosing the right term plan can be daunting, given the vast array of options available in the Indian market. This guide will help you navigate this complex Term Insurance landscape by shortlisting the top 5 best term insurance plans available in the market.
Aside from protecting your family in the event of your death, term insurance also comes with a bunch of additional protections that can be availed in the form of add-on riders. Aside from death benefits, some other benefits such as life-stage benefit, premium break, return of premium benefit, critical illness diagnosis benefit and more.
Things to watch before Choosing a Term Plan
- Sum Assured: This is the amount your family will receive upon your death. It should be minimum 10x of your annual income, which would be enough cover your family’s financial needs, considering the inflation.
- Policy Term: This is the duration for which the policy remains active. Make sure you choose a term that aligns with your financial goals and the time horizon, for which you would pay the premium
- Premium: It is the amount you pay periodically (yearly/monthly) for the policy. Consider your budget and pick a plan with an affordable premium
- Riders: It is additional cover that can be added to the main term insurance policy to offer enhanced protection. Add-ons like personal accident cover, critical illness cover, and disability cover are some of the add-ons that you can use.
- Claim Settlement Ratio: This reflects the rating of a company in settling their claims. Choose a company with a good track record of high claim settlement ratio.
| Plan name | Benefits | Premium |
| Max Life Smart Secure Plan | 1 cr life cover, 64 Critical Illness cover | From 730p/m for 1 crore cover |
| HDFC Click2 Protect Super | Flexibility to choose from multiple coverage, acceleration of death benefits, | Life cover of 1 Crore @ Rs.21/day*** |
| ICICI Pru iProtect Smart | Special rates for non-tobacco users, 15% discount on premium rates, | Rs. 16940 premium for 1 crore cover for a 30 year old |
| SBI Life – eShield Next | Life Cover Upto 100 Years, Better Half Benefit Option, Option to Pay premium – Only once or limited term | From Rs. 478 p/m for 1 crore cover |
| Tata AIA Sampoorna Raksha Supreme | 105% premium option, Express 4 hour settlement, | From Rs. 547p.m for 1 crore pver |
-
Max Life Smart Secure Plan
This policy stands out with features such as cover for 40 critical illnesses and a return of premium option on policy expiry. The plan offers multiple death benefit payout options including lump sum and monthly income
- Two Death Benefit Options: You can choose between receiving a base death benefit and a terminal illness benefit when diagnosed with an critical illness
- Terminal Illness Benefit: This benefit provides a lump sum payout if you are diagnosed with a covered critical illness, helping manage treatment costs and financial burdens.
- No Additional Cost: The terminal illness cover is included at no extra cost with the base death benefit.
Customization Options:
- Sum Assured Flexibility: Choose a sum assured that meets your financial needs and goals. The plan offers a wide range of coverage options with you having the say in the upper limit
- Benefit Flexibility: With this plan, you get to choose from multiple benefit types while purchasing the policy – Base Policy, Accelerated Critical Illness (Option), Accident Cover option.
- Customizable payment: The policy holder’s family can receive the payout in the event of policyholder’s death as lump sum, monthly income, or part lump sum and monthly income
- Optional Riders: Enhance your coverage with optional riders like accidental death benefit, waiver of premium on disability or critical illness, and joint life cover to extend protection to your spouse.
Other Benefits:
- Tax Benefits: Premiums paid towards the plan qualify for tax deductions under Section 80C of the Income Tax Act, 1961.
- Special Exit Value: In case you surrender the policy after a certain period (as defined in the policy document), you may receive a special exit value which could be a portion of the premiums paid.
- Non-Linked and Non-Participating: This plan is not linked to the market and guarantees the sum assured payout upon death during the policy term. It also doesn’t participate in the company’s profits.
-
HDFC Click2 Protect Super
Death Benefit Flexibilities:
- Life Option: Provides a death benefit payout to your nominee in case of your demise during the policy term. The benefit can be accelerated if a terminal illness is diadnosed
- Life Plus Option: Offers a death benefit payout and an additional amount in case of accidental death during the policy term. Similar to the Life Option, the benefit can be accelerated upon diagnosis of a critical illne
- Get to choose increasing Death Benefit up to 200%
- Opt to vary your Death Benefit according to your needs
- Avail Waiver of Premium on diagnosis of Critical Illness and Total and Permanent Disability
- Provides Acceleration of Death Benefit on diagnosis of specified terminal illnesses, till age 80 years
Critical Illness Cover (Life Plus Option Only):
- Provides a lump sum payout upon diagnosis of a covered critical illness, helping manage treatment costs.
Plan Customization:
- Multiple Plan Options: Choose between Life Option (death benefit focus) or Life Plus Option (death benefit with critical illness cover and accidental death benefit).
- Increasing Cover: Opt for an increasing sum assured over the policy term to keep pace with inflation and maintain financial protection for your loved ones.
- Limited Pay Option: Pay your premiums for a limited period (chosen at signup) and enjoy coverage throughout the entire policy term.
- Return of Premium Option (Optional Rider): Get a refund of all premiums paid in case you survive the policy term.
- Other Optional Riders: Enhance your coverage with riders like waiver of premium on disability or critical illness, and joint life cover to extend protection to your spouse.
Additional Features:
- Tax Benefits: Premiums paid towards the plan qualify for tax deductions under Section 80C of the Income Tax Act, 1961.
- Claim Settlement Ratio: HDFC Life boasts a good claim settlement ratio, indicating a high probability of receiving your payout in case of a claim.
- Multiple Payout Options: Choose how your nominee receives the death benefit – lump sum, installments, or a combination.
-
Tata AIA Sampoorna Raksha Supreme
It gives you an option to enroll under any of three schemes – Life, Life Plus, and Life Income and credit protect
The minimum period of policy period is 10 and the maximum is 82 years
Death Benefit:
- Guaranteed Payout: Provides a guaranteed death benefit payout to your nominee in case of your unfortunate demise during the policy term. get up to 105% of the premium** amount you paid using Life Plus Option
Flexibility and Customization:
- Whole Life Coverage: Get whole life coverage upto 100 years to guarantee long term financial security for your loved ones
- Multiple Premium Payment Options: Choose a payment frequency that suits your budget, such as monthly, quarterly, half-yearly, or yearly
- Policy Term Options: Select a policy term that aligns with your financial goals and protection needs.
- Optional Riders: Strengthen your coverage with riders like accidental death benefit, waiver of premium on disability or critical illness, and income benefit riders for a monthly payout to your family in case of your death.
- Life Stage Benefit (Optional): Increase your sum assured automatically at significant life milestones like marriage or birth of a child
Other Benefits:
- Tax Savings: Premiums paid qualify for tax deductions under Section 80C of the Income Tax Act, 1961. Save upto Rs. 46800 on taxes
- Maturity Benefit (Optional Rider): Receive a lump sum payout at the end of the policy term if you survive (available with specific riders).
- Policy Revival Option: Revive a lapsed policy within a certain grace period (as defined in the policy document) by paying the due premiums and any applicable revival charges.
Tata AIA Vitality:
Tata AIA Vilatility is a holistic wellness program that helps you improve your health while also rewarding you. Upon enrolling in this wellness program, you get an instant discount of 10% even in your first year premiums. The premium in the subsequent years depends (may increase or decrease) based on your wellness
-
SBI e-life shield next
SBI is a new age term insurance plan. It is a non-linked and non-participating pure life protection plan that will take care of your family’s financial requirement
Guaranteed Payout
- Provides a guaranteed death benefit payout to your nominee in case of your demise during the policy term. The payout amount is determined by the chosen plan option and sum assured. For regular plan, the nominee will get 10x benefits of the annualized premium. 105% of the total premium amount that is received up to the death date. It has a impressive claim settlement ratio of 99.17%
- For single premium, you get 1.25x of the single premium
Flexibility and Coverage Options:
- Three Plan Options: Choose from Level Cover (fixed sum assured upon death throughout the term), Increasing Cover (sum assured increases automatically at pre-defined intervals), or Level Cover with Future Proofing Benefit (option to increase sum assured at important life events).
- Sum Assured Options: Select a sum assured that meets your financial protection needs.
- Terminal illness: This option is available for all policies
- Policy Term Options: Choose a policy term that aligns with your financial goals and dependents’ needs.
Additional Features:
- Online Convenience: Apply and manage your policy online for a hassle-free experience.
- Online Discount: Get online discount upto 10%
- Riders: Enhance your coverage with optional riders like accidental death benefit, permanent disability benefit, and waiver of premium on disability.
- Terminal Illness Benefit (Available in all plans): Get terminal illness benefit (even AIDS) subject to the maximum amount of Rs. 2 crores would be payable
- Tax Savings: Premiums paid towards the plan qualify for tax deductions under Section 80C of the Income Tax Act, 1961.
-
ICICI Pru iProtect Smart Term Plan
It is a top selling plan online. It offers a term insurance which acts as a financial safe net for your family and a critical illness cover (optional). This plan has the provision to cover you till you are 99.
Features of ICIC Pru iProtect Smart Term Plan
- Enhanced Protection – Coverage against death, critical illness, and disability
- Special Reduced Premiums for non-tobacco users and salaried customers
- 15% discount rates on premium rates for life cover for women
- Special premium rates for women for Accelerated Critical Illness Benefit
Flexibility and Customization:
- Choose Your Coverage: Opt for various coverage options like Life (basic death benefit + terminal benefit + premium waiver on permanent disability), Life Plus (death benefit + terminal illness + with accidental death benefit), Life and Health (death benefit with accelerated critical illness cover), and All-in-One (comprehensive coverage including death benefit, accidental death benefit, and critical illness cover).
- Sum Assured Options: Select a sum assured that meets your financial needs and goals. The plan offers a wide range of coverage amounts.
- Increase Cover (without Medicals): Enhance your sum assured at specific life stages like marriage or childbirth without undergoing fresh medical tests (subject to policy terms and conditions).
- Policy Term Options: Choose a policy term that aligns with your financial goals and protection needs.
Payout
- You have the option to choose what your nominee receives from the life cover amount. The four feasible payout options would ensure your family gets to continue the same lifestyle even after your death.
- Income – Nominee will receive a monthly regular income for 10, 20, or 30 years as chosen by you
- Lump sum plus income – In your absence, your nominee will receive a lump sum payout along with a monthly regular income for 10/20/30 years as per your choice.
- Lump Sum – In your absence, your nominee will receive the life cover as a lump sum payout
- Increasing Income – After your death, your nominee will receive a regular increasing monthly payable for the forthcoming 10 years. Every year, the income will increase by 10%
Additional Benefits:
- Tax Savings: Premiums paid towards the plan qualify for tax deductions under Section 80C of the Income Tax Act, 1961.
- Online Convenience: Apply and manage your policy online for a hassle-free experience.
Claim Settlement Process: ICICI Pru boasts a good claim settlement ratio, indicating a high probability of receiving your payout in case of a claim.