Life Insurance Plans
  • Secure Your Family's Future
  • Explore the Top 5 Life Insurance Plans
  • Understand the Types of Life Insurance Policies
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What Is Life Insurance?

Life insurance is a mutual contract between the policyholder and the insurance company, where the company promises to pay a pre-specified amount to the nominee in case of death of the policyholder or after a predetermined period, and in return, the insured needs to pay the premium for a certain period.

How does it work?

Such policies offer financial coverage to the insured or his family in the contingency linked with human life, like death, disability, accident, retirement, etc. The insurer needs to pay the premium for a specific time, and in return, your insurance company will offer you a Life Cover.

Moreover, along with financial protection, one can avail of tax benefits under Section 10(10D) & Section 80C of the Income Tax Act, 1961.

Why A Life Insurance Policy Is Important?

Our lives are uncertain and full of risks. In an unfortunate event where something happens to anyone, the entire family suffers. And if that person is the only bread earner then the suffering worsens. Here comes the role of Life Insurance. Though human life can not be measured, a monetary sum can help the dependants continue their lives without sacrificing their needs and requirements.

Moreover, a life insurance plan is also an investment tool where you can avail of the maturity benefits provided you survived the policy term. The amount can help you attain your life's milestones such as your daughter's marriage, your child's higher studies, etc. Along with protection, a life insurance plan offers peace of mind.

Let's understand the importance of life insurance with an example.

Varun and Amar are childhood friends. Amar decided to buy a life insurance policy and suggested Varun invest in the same but he refused. 20 years later, Amar's daughter wishes to pursue higher studies while on the other hand, Varun plans to get his elder daughter married. As Amar has invested in the life insurance policy which has matured by now. He can use that lump-sum amount to fulfil his daughter's dreams. Whereas Varun has to sacrifice all his life-long savings to meet the wedding expenses. Had Varun purchased a life insurance plan earlier, he would have saved his money for uncertain times.

What Are The Benefits of Life Insurance?

Benefits of Life Insurance

How Much Life Cover is Needed?

The sole purpose of having life insurance is to keep your family financially independent in your absence. However, the answer to this question varies from person to person depending on their lifestyles and necessities. You need to evaluate your income, liabilities, dependents, etc. to fix the required life cover amount.

If we go by the financial expert's thumb rule, your life insurance coverage should be at least 10-15 times the annual income.

For better understanding, let's look into the two scenarios of two different families.

FamilyMr Verma, a 30-year-old working professional, lives with his wife, his parents and has a 3-year-old child.Mr Sharma, a 30-year-old working professional lives with his wife and 2 children.
ExpensesMonthly: Rs. 50,000
Annual: 6 Lakhs
Monthly: Rs. 60,000
Annual: Rs 7.2 Lakhs
LiabilitiesAn outstanding home Loan of Rs. 50 LakhsNo loans
Money Needed for Children's education and Marriage20 Lakhs30 Lakhs
Retirement Corpus for spouse40 Lakhs40 Lakhs
Coverage Required90 Lakhs (monthly expenses*15) + 50 + 20+ 40 Lakhs = Rs. 2,00,00,000 Approximately1.08 crore (monthly expenses*15 + 30 + 40 Lakhs) = Rs. 1,78,00,000

Keeping in mind the expenses, liabilities, and responsibilities towards his child, Mr Verma would need a life cover approximately of Rs. 2 crores, whereas, Mr Sharma would need a cover of Rs. 1.78 Crores.

Top 5 Life Insurance Plans in India

Best Life Insurance Policy

Listed below are the 5 Best Life Insurance Plans:

PlansPlan TypeMin/Max Entry AgeMaximum Maturity Age
LIC Tech Term PlanTerm Insurance Plan18 years/65 years80 years
HDFC Life Sanchay PlusSavings Plan5 years/60 years80 years
SBI Shubh Nivesh planSavings Plan18 years/60 years65 years
ICICI iProtect SmartTerm Insurance Plan18 years/65 years75 years
Max Life Online Term Plan PlusInvestment Plan18 years/60 years85 Years

Key Features of Top 5 Life Insurance Plans

LIC Tech Term PlanA pure life cover that comes out with two death benefit payout options such as Level Sum Assured or Increasing Sum Assured.Explore Plan
HDFC Life Sanchay PlusWith several other benefits, the plan offers guaranteed returns to the insured and their family.Explore Plan
SBI Shubh Nivesh planA traditional savings plan that comes out with two investment option - Endowment plan & Whole Life Plan.Explore Plan
ICICI iProtect SmartOffers 360-degree protection to your family, allowing in case of your unfortunate demiseExplore Plan
Max Life Online Term Plan PlusAn online term insurance plan that looks after your family's needs and offers 3 payout options for the family - lump sum one time, lump sum along with a monthly income, or lump sum with increasing monthly income.Explore Plan

What Are the Types of Life Insurance Policies?

  1. Term Insurance

    It is the most basic form of life insurance. Simply put, the beneficiary will avail of the death benefit only if the insured dies during the policy tenure. Once the policy matures, the insurance company is not liable to pay any benefits.

    A term insurance plan is beneficial for those who want to secure the financial future of their family at affordable premiums.

  2. Whole Life Insurance

    Whole Life Insurance Plans remain in force till the policyholder is alive, provided required premiums are paid. On the policyholder's death, the plan pays a sum assured and bonus (if any) to the nominee. A Whole Life Term Insurance can help you to leave a legacy for your children.

  3. Endowment Plan

    Also known as traditional life insurance plans, the Endowment policy is a combination of a life coverage plan and savings plan. Along with life coverage, a policyholder can also save their funds regularly for a specific period. In case the policyholder outlives the policy term, the insurance provider offers a maturity benefit to him/her.

    Such policies can be used to build a risk-free savings corpus, and on the other hand, will provide financial protection to your family in case of an unfortunate event.

    Also read Term Life V/s Traditional Life Insurance

  4. Child Insurance Plan

    It is a combination of insurance cover and investment that secure multiple stages of your child. In other words, it provides financial coverage to your child's future needs and allows you to plan his/her future in a better and stabilized way. With a child insurance plan, you can create a corpus to fulfil all your child's needs and ensure that your child doesn't have to sacrifice their dreams because of any financial crunch.

  5. Pension Plan

    This plan assists you in securing your post-retirement life financially. The benefits are given annually or once after reaching 60 years (depending on the insurer/policyholder). The plan offers a vesting benefit (maturity benefit) if the policyholder outlives the policy term.

  6. Unit-Linked Insurance Plan (ULIP)

    Unit-Linked Insurance Plans offer a combination of investment and insurance. Under the same, a small portion of your money is used for life coverage, whereas, the rest of the money is invested in the market.

  7. Investment Plans

    An investment plan allows the policyholder to invest small amounts (in a periodic manner) to boost his/her savings. The frequency of investment can vary- weekly, monthly, and quarterly. Along with savings, you get the benefit of insurance coverage.

  8. Money-Back Plan

    In a money-back plan, the policyholder is eligible to get a specified percentage of their sum assured at regular intervals. This type of life insurance is ideal for those who want to invest with the benefit of liquidity.

What Are Life Insurance Riders?

Riders are the add-ons that provide additional financial coverage to the policyholder. Some plans come with the in-built additional cover, however, generally, the riders need to be purchased separately by paying an additional premium.

Having additional coverage enhances protection for you and your family in case of death, disease, or disability.

Popular life insurance riders are:

1 Critical Illness Rider

Critical Illness Rider benefits the policyholders in case they get diagnosed with any of the critical illnesses listed in the policy document. The rider pays out the critical illness sum assured and allows the policyholders to concentrate on their treatments without worrying about the finances.

2 Accidental Death Benefit Rider

With the help of Accidental Death Benefit Rider, if the policyholder dies in an accident during the policy term, then a percentage of this additional sum along with the sum assured will be paid to the beneficiary by the insurance company.

3 Accidental and Total Permanent Disability Rider

This rider comes in force if the policyholder meets with an accident and is declared partially or permanently disabled. The rider pays the predetermined percentage amount and can be relied upon as the income source.

4 Accelerated Death Benefit Rider

If the policyholder is diagnosed with any life-threatening terminal illness such as leukaemia, cancer, AIDs, etc., this rider will pay a part of the death benefit and can be used for the treatment of the policyholder.

5 Waiver of Premium

Under this rider, if the policyholder is unable to pay his premiums due to the loss of income because of any unfortunate accident or injury, or disability, then all the future premiums will be waived off, and the policy will continue with no restrictions.

6 Term Rider

Term rider pays a fixed or monthly income to the beneficiary in case of the policyholder's demise. This rider offers extra coverage for death in addition to the base sum assured that is predetermined by the insurance company.

7 Surgical Rider

Surgical Rider assists the insured by providing financial coverage in case the policyholder undergoes an unavoidable surgery in India.

What Are The Factors That Affect Life Insurance Premium?

A life insurance premium is an amount that is paid by the policyholders for a specified period and lets them enjoy the life insurance benefits. One can select their premium payment mode as per their needs.

Below are the few important factors that are considered by life insurance companies and can affect the life insurance premiums:

  • Age: Age is a significant factor while calculating the life insurance premium. As per the insurer's perspective, a young individual is less likely to suffer from age-related disease and pass away prematurely, and also has a higher chance of continuing their insurance policy for years. This makes younger individuals eligible for low premiums.
  • Lifestyle: If a person smokes/drinks/leads a stressful lifestyle, (s)he needs to pay higher premiums. This happens because such habits lead to life-threatening illnesses, lowering your life expectancy.
  • Gender: According to some surveys done in India, it is proven that women tend to live longer than men. Due to this disparity, women generally pay fewer premiums than men.
  • Medical History: If a person has a medical history of critical illnesses or is prone to health issues, then in such cases the insurance companies charge a higher premium.
  • Policy Tenure: The longer your policy tenure, the higher is the risk to insurance companies. Therefore, life insurance plans with shorter-term have lower premiums than long-term life insurance policies.

Why Should You Compare and Buy Life Insurance With PolicyX.com?

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How to buy Life Insurance from PolicyX.com

Check out the below steps and buy your life insurance now:

Buying Process Life Insurance from PolicyX.com

What Are The Documents Required To Buy Life Insurance?

If you have decided to buy life insurance, there are a few documents that you need to provide:

1

Age Proof

Driving License, 10th or 12th mark sheet, Birth Certificate, Passport, Voter ID, etc.

2

Identity Proof

PAN Card, Passport, Driving License, Voter ID, or Aadhar Card.

3

Address Proof

Electricity Bill, Telephone Bill, Ration Card, Driving License & Passport.

4

Income Proof

Latest form 16, salary slips of last 3-6 months, ITR (2-3 years), etc.

**Some plans require a medical check-up to make sure that the insured does not suffer from any chronic illness. The company may ask for other documents as well.

How To File A Life Insurance Claim?

If a claimant follows all the required steps, then filing a claim and getting a sum assured can become a very convenient and hassle-free task. Read ahead to find how a claimant can file a claim in India under the following scenarios:

In case of the insured's death, the nominee of the deceased will be able to claim in the following way:

  1. Intimate the insurer about the death as soon as possible with all the important details such as time, place, and cause of death.

  2. Submit needful documents and proof to the insurance company. This will consist of the insured's death certificate along with the claim form provided by the insurance company.

  3. If the policy was assigned, the assignee will have to provide the documents. If someone else (apart from the nominee or assignee) is filing a claim, (s)he has to submit the legal proof of his/her relation with the insured.

  4. If required, post-mortem, hospital, and attending doctor's reports have to be submitted.

  5. In cases involving police inquiries, an investigation/survey report will have to be submitted.

  6. Once the investigation is over, the insurance company will approve/disapprove the claim. The details of the same will be shared with the claimant.

In Case The Policy Is Matured

If the insured outlives the policy term, then he/she is eligible to avail all the maturity and surviving benefits, provided all the premiums have been duly paid. The procedure for filing a claim is as follows:

  • When the maturity date of the policy is near, the insurance provider will send an intimation to the policyholder with a discharge voucher (at least 2-3 months prior to the date of maturity).
  • The policyholder has to sign the voucher and send it back to the provider with the original policy bond.
  • If the policy is assigned to someone else (individual/entity), the amount will only be paid to the assignee who will give the discharge.

Life Insurance FAQ's

1. When to buy a Life Insurance Policy?

At the very moment when you feel that your family or loved ones are dependent on you for their needs, without even thinking for a minute, you should buy the policy.

2. How to know your present expenses to get the best life insurance plan?

Before buying an insurance policy, think about the liabilities which are there. From the loans of the banks to the credit card bills, keep everything in mind. If your family is living in rented accommodation, think about the rent that the policy should be able to give till your children grow up and earn.

3. What is the difference between Life Insurance & Term Insurance?

In a Life Insurance Policy, the policyholder will receive the maturity benefit of the policy. The policyholder needs to set tenure for the policy and if in an unfortunate event of his/her demise, the money is given to the nominee.

In a Term Insurance Plan, insurance companies provide financial assistance to the nominee of the policyholders in case of an unfortunate demise of the policyholder within the policy term. Under a term insurance plan, there is no claim to the money if the person survives until the policy tenure maturity.

4. Does life insurance cover accidental death?

Yes, life insurance policies do cover accidental death. However, one must check the policy documents if it specifically states that it does not cover death by accident.

5. Do Life Insurance Policies offer Grace Period?

Yes. The life insurance policies offer a grace period of 30 days (to pay the premium) in case the policyholder missed his/her premium payment date.

6. How Much Life Cover Can I buy?

The amount of cover depends on your income, your family's requirements, and your liabilities. However, as per the financial experts, your cover should be at least 10-15 times the annual income.

7. Will the family of the policyholder receive life insurance benefits if they committed suicide?

In such cases, if the policyholder commits suicide within 12 months of purchasing a policy, the nominee won't get any insurance benefits. However, post 12 months, the policy will pay the death benefit to the nominee.

8. How to revive a lapsed life insurance policy?

The IRDA has directed all the insurance providers to allow policyholders to revive their lapsed policy within two years from the time it is deactivated. One needs to pay the renewal fee along with the late fee and additional penalties that may vary from insurer to insurer.

9. What will happen to the life insurance benefit if both the policyholder and nominee dies?

In such scenarios, where both the policyholder and nominee died, then the benefit will be payable to their heirs or legal representative.

10. What to do if my nominee dies before me?

In such a case, you can add a new nominee. In case you don't, by default, the company will consider your heir your new nominee.

Naval Goel

Reviewed By: Naval Goel

Naval Goel is the CEO & founder of PolicyX.com. Naval has an expertise in the insurance sector and has professional experience of more than a decade in the Industry and has worked in companies like AIG, New York doing valuation of insurance subsidiaries. He is also an Associate Member of the Indian Institute of Insurance, Pune. He has been authorized by IRDAI to act as a Principal Officer of PolicyX.com Insurance Web Aggregator.

Find Out What Customers Are Saying

(Showing latest 5 reviews only)

- 4.5/5 (458 Total Rating)

1 days ago

Barkha Khanna

Delhi

One of the best Life Insurance companies. Amazing company with amazing customer support. I would definitely recommend this company to others.

1 days ago

Disha Padukone

Jalandhar

It was a pleasure associating with policyx for my term insurance. The company is professional and offers good solutions that will actually help people

1 days ago

Salman A

Bengaluru

very good work ethics at SBI nsurance...policyx agent helped me buy a policy from here. So it helped !

1 days ago

Firdos Khan

Indore

bought my Kotak policy from policyx.com and these guys were so swift with the whole thing! like they gave me a proper list of plans to go thru and i did my own research after which the buying was damn quick !

1 days ago

Saheba Quereshi

Chandigarh

thanks LIC for settling my claims so shortly! it was really urgent and I m happy to have placed my trust on the company

Last updated on 20-09-2021

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