Term insurance is one of the keys parameters for financial planning. It provides protection to you and your family in case of any undesirable thing happened in your life. Though it is an insurance product, unlike the traditional insurance policy it differs in terms of the risk cover. It offers a big amount of sum assured to your family in the event of the death of the policyholder.
If nothing happens to the policyholder during the policy term, nothing is given back to the policyholder. Your money is gone in vain. Upset? you should not be. here is why. Tell me do you own a car? if yes, do you pay insurance premium every year on your car? The answer is yes, and if there is no accident occurred during the year do you get anything back? Big no! So if you are paying for car insurance every year without fail, why not for your life and your family? Does your life is less important than your car?
The premium for term insurance is lower as compared to the traditional policies. It also depends on the various factors like age, the term of the policy, sum assured, your health etc. There are the plethora of the team insurance plans available in the market. More the option more the confusion. For a layman, it becomes very difficult to choose the best term insurance plan out of the huge universe of the plans. Most of the insurance companies are offering almost similar kind of plans or with a little bit of tweak.
Benefits of Term Plan
- Get the lump sum amount in case of sudden death
- Adequate money for your family so that they can live a life with pride
- Disability or critical illness covered
- Income source in case of disability or critical illness
- Take care of all your financial liabilities
What is the ideal policy term?
one should ideally have a term life cover till retirement because most people do not have
dependents after retirement. Also, longer life cover increases the premium. In case you have some loans or liabilities which will continue even after your retirement. You may choose your life cover accordingly.
Ideal Policy Term = Your expected retirement age – Your current age
You have to be careful while selecting the best term insurance plan otherwise you will end up buying a wrong one for your self and your family. To help you here is the list of best term insurance plans along with their salient features.
Best Term Insurance Plans in India
ICICI Pru Smart Protect plan is more than a term plan that protects you and your family. It also provides health cover against 34 critical illnesses. It offers to provide accidental death cover up to 2 Cr.
- Protection against 34 critical illnesses and accidental death
- Special premium rates for non-tobacco users.
- Affordable premium
- Special rates for women
- Covers female organ cancers such as breast cancer and cervical cancer
- Enjoy the tax benefit under the policy
- Offers 4 payout options
- It pays life cover on terminal illness (including AIDS)
- Option to ad accidental benefit now or later
- Death due to suicide is also covered under this plan
Looking at the above features of the term plan, I have rated this as one of the best term insurance plans.
This plan covers 3 uncertainties Death, Disability, Disease. that’s why its called 3D plan. Key features of the plan are as below.
- Affordable cost
- Customize plan with 9 available options
- Future payments are waived off in case of accidental total permanent disability
- Flexibility to choose your policy and premium payment terms
- Flexibility to increase your cover every year through top-up option
- Special premium rates for female lives
- Attractive premium rates for non-tobacco users
- Tax benefits as per prevailing law
What comes first to your mind when you talk about insurance in India? LIC right? It is big brand for ages. It is the most trusted insurance company in India. LIC e-Term plan is an online term insurance plan. Below are the features of the plan.
- The plan is available through the online portal only, no agents are involved
- It is a pure term plan and does not offer any benefit on the maturity, it provides benefits only in case of the demise of the policyholder
- It covers all type of death including accidental death
- The loan cannot be given against policy
- The plan provides coverage up to 75 years of age
- The plan does not offer any riders
- Premium amount is slightly higher as compared to other competitors
The plan covers basic life cover with increasing monthly income for your family.
- Offers one-time payout to the nominee
- You can add riders
- It gives an option to increase coverage at important milestones
- Maximum coverage up to the age of 85
- The plan is also available for NRIs for selected countries
It is one of the best plans in India. This is the only plan which covers up to 100 years. Below are the features.
- Enjoy the life cover up to the age of 100 years
- Best value with high cover at low premium rates
- Increase your life cover to meet the growing needs of your family
- Provides 25% of the death benefit on diagnosis of any terminal illness and future premium is waived off
- Flexible payout option
- Additional coverage available at the nominal charges
SBI eShield is the pure term plan. Its features are as below.
- Choose between two benefits: Life cover or Increasing cover
- Affordable premium, special discount for non-smokers
- The plan provides no maturity benefits
- Level cover benefit
- Offers grace period of 30 days on yearly and half yearly premium
- Offers 2 years of revival facility
What should you look for while selecting term policy?
- Premium – The first thing you should check is the premium amount charged by the company. Compare various plans of different companies and choose the one which fits your wallet. There are many insurance policy aggregators like Policy bazar Coverfox Bankbazar Here is the list of the companies which offer an online insurance policy. – Online Insurance Policy
- Additional Riders – Some of the companies are offering additional riders like maturity benefits, different payout options etc. Compare these features and choose the best one for you which suits you and your family needs.
- Claim settlement ratio – To me, this one is the most important parameters to check while selecting the insurance plan. Claim settlement ratio means how many policies claims a company has passed against the total policies. Choose the plan which has highest claim settlement ratio.
To help you out, I have design below chart of best term insurance plans in India.
Having a term insurance plan is must. It is the foremost requirement for an individual who have a family and liabilities.
Hope this helps!