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Best Term Insurance Plans
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Best Term Insurance Plans In India

Term insurance refers to being a strong and much required financial tool that provides helpful financial assistance to your family in your absence. It allows your family to live independently and maintain their living standards. It also assists in dealing with all liabilities so they never feel the burden. The plan offers coverage against the risk of death, disability, and disease.

In India, around 24 insurance companies are offering online Term Insurance Plans. Hence, it is difficult to choose the best among all for the secure future of our loved ones.

To ease your worries, we have listed the top 6 term insurance plans of 2020 which are highly effective and can help you during hard times. The data available is updated as per the latest plans (IRDA 2018-19 report) with complete details.

Best 6 Term Insurance Plans in India of 2020

Sr. No.Term Insurance PlansPolicy TermCoverageSum assuredClaim Settlement Ratio 2018-19Add-on Covers
1.LIC Tech Term10-40 years65 years50 Lakhs97.79Available
2.ICICI Prudential iProtect Smart Term Plan5-85 years (less age an entry)75 years8 Lakhs98.58%Available
3.SBI Life eShield5-30 years75 years35 Lakhs95.03Available
4.HDFC Click 2 Protect 3D Plus Term Plan5-40 years65 years10 Lakhs99.04Available
5.Max Life Online Term Plan Plus10-35 years85 years25 Lakhs98.74Available
6.Aegon Religare iTerm Plan5-40 years (or up to 80 Years)100 years25 Lakhs96.45%Available

Below is the detailed explanation of all 6 term insurance plans.

1. LIC Tech Term Insurance Plan

LIC Company

It is a non-linked pure protection plan that offers the required financial protection to the insured's family in case of his/her unfortunate demise. You can easily avail of the required plan through an online application process and no intermediaries will be involved.

Features and Benefits

  • It is a pure term insurance plan that provides a death benefit only and no maturity benefit.
  • It will provide coverage on all forms of death (including accidental death).
  • The entry age is 18 years and the maximum is 65 years.
  • The minimum sum assured is Rs.50 lakhs (non-smoker).
  • Free look period is 30 days provided by the company on purchasing the policy if the policyholder is not satisfied by any of the clauses in the policy document.
  • It is applicable for Non-Resident Indians (NRIs) as well who will be covered under the plan even if they are not in the country but should be present in the country for the medical tests.
  • Premiums paid up to Rs.1.5 lakhs every year is applicable for deduction from the taxable income under Section 80C of the Income Tax Act, 1961.
  • The amount payable as a death benefit to the beneficiary(s) is also exempted from tax under Section 10 (10D) of the Income Tax Act, 1961.

2. ICICI Prudential iProtect Smart Term Plan

ICICI Prudential Company

iProtect Smart by ICICI Prudential is an effective term insurance policy that offers 360-degree coverage at an affordable premium. It also allows you to file a claim against 34 critical illness diseases. It is also rated as one of the best term insurance plans of 2018-19 because of its attractive features.

Features and Benefits

  • It offers 4 payout options consisting of the lump sum, income, and increasing income of your nominee.
  • It also provides terminal illness (including AIDS) advantage i.e. you will get the claim amount in case of diagnosis of any of the 34 critical illnesses. This is a one-time benefit only during the entire policy tenure.
  • The plan offers different options to avail death benefits such as in lump sum or regular income.
  • It comes out with a wider cover that includes a wide list of critical illnesses.
  • Suicidal cases are also liable to get coverage under this plan.
  • The minimum tenure of the policy is 5 years and the maximum is 85 years (5-85 years, less age an entry).
  • The minimum sum assured is 8 lakhs.
  • Life plus-along with life option offers accidental rider benefits.
  • Life & health along with life option offers critical illness rider benefits.
  • Premiums paid and benefits received under the policy are tax-free under Section 80C and Section 10 (10D) of the Income Tax Act, 1961.

Different iProtect Smart Term Plans

Variant NameBenefits
Life
  • Death
  • Terminal illness benefit
  • Premium waiver on permanent disability
Life Plus
  • Death
  • Terminal illness benefit
  • Premium waiver on permanent disability
  • Accidental death benefit
Life and Health
  • Death
  • Terminal illness benefit
  • Premium waiver on permanent disability
  • Critical illness benefit
All In One
  • Death
  • Terminal illness benefit
  • Premium waiver on permanent disability
  • Critical illness benefit
  • Accidental death benefit

Protection Benefits

1) Death and Terminal Illness

The life cover amount will be provided only in case of death and terminal illness of the policyholder to the nominee(s). If diagnosed with a terminal illness, a 100% cash payout of the total life cover will be given.

The policy will terminate on payment of either the death benefit or terminal illness. Terminal illness refers to high-risk death within the next 6 months as diagnosed by medical practitioners.

2) Permanent Disability

If the policyholder is diagnosed with permanent disabilities due to an accident, he/she will not have to pay the future premiums. The policy will continue normally.

3) Accidental Death (optional)

In case of death due to an accident, the nominee(s) will get a lump sum amount in the form of an accident cover under the plan.

4) Critical Illness (optional)

If the policyholder diagnosed with critical illness with any of the 34 listed diseases, he/she will receive a lump sum payout for the treatment.

3. SBI Life eShield

SBI Company

State Bank of India, the trusted brand in the industry of banking and finance offers SBI Life eShield; one of the purest term insurance policies that offer a wide range of benefits at an affordable premium.

Features and Benefits

  • Ensures that your family is financially protected.
  • You can choose between two benefit structures and two rider options.
  • It offers simplicity via an easy online process.
  • It is affordable through reasonable premiums.
  • Always gives you a second opinion (medical).
  • Additional benefits such as inbuilt accelerated terminal illness benefit, etc.
  • If you are a non-smoker, you will be eligible for huge premium discounts.
  • The minimum tenure of the policy is 5 years and a maximum is 30 years.
  • The coverage is up to 75 years.
  • The plan offers death benefit to the nominee on insured death depending upon the benefit structure chosen,
  • Tax benefits are applicable under Section 80C and 10 (10D) of the Income Tax Act, 1961.

4. HDFC Click 2 Protect 3D Plus Term Plan

HDFC Company

HDFC Click 2 Protect 3D Plus Term Plan is an exclusive term insurance policy that covers three uncertainties i.e. death, disability, and disease. It is an effective yet affordable Term Insurance policy.

Features

  • An exclusive feature of lifelong protection that allows you to increase insurance cover on precious occasions such as marriage and childbirth.
  • Option to increase coverage on a yearly basis.
  • Accidental death benefits (as a rider) are available.
  • Females and non-tobacco users can easily avail attractive discounts on premiums.
  • The plan is providing complete coverage along with a premium waiver benefit.
  • The minimum policy tenure is 5 years and the maximum is 40 years.
  • Taking the payout as lump sum + monthly claim settlement.
  • Premiums paid and benefits received under the policy are tax-free under Section 80C and Section 10 (10D) of the Income Tax Act, 1961.

Benefits

I. Death Benefit:

In the event of the death of the policyholder when the policy is in force, the nominee(s) shall get the benefits as follows:

  • Single-Premium Policies: 125% of single premiums, or the sum assured (the one which will be higher).
  • Policies Other Than The Single Premium Type: 10 times the annualized premium, or, 105% of all paid premiums until death (date of death), or, the sum assured, the one which will be higher.

II. Life Stage Protection:

It is an alternative cover that is applicable under the life option of the policy and can be purchased by paying an additional premium. This cover provides financial assistance to the policyholder throughout life.

III. Increase Your Sum Assured:

The coverage for insurance can be increased anytime.

IV. Reduce Additional Cover (Later Stage):

The policy provides an option to minimize the Additional Insurance Cover after the age of 45 years of the policyholder.

V. Maturity Benefit:

No amount will be paid to the beneficiary(s) if the policyholder will survive till the last date of the end of the policy tenure.

VI. Income Tax Benefit:

The premium that is payable up to Rs.1.5 lakhs is only applicable for deduction from Income Tax under Section 80C. Premiums paid below this amount will be tax-free.

5. Max Life Online Term Plan Plus

Max Life Company

Max Life Online Term Insurance is the next plan in the bucket of top term insurance policies of India. It offers the required basic life cover along with the increased monthly income options for your family in your absence. The company also carries good claim settlement ratios of 98.74%.

Features and Benefits

  • It offers the option of a one-time payout to the beneficiary along with a rising amount for 10 years.
  • Insured can enhance the cover by choosing optional riders such as accidental death, premium waiver, and critical illness covers by paying an additional premium.
  • The minimum entry age is 18 years whereas maximum entry is up to 60 years.
  • It offers the option to increase the required cover in some precious moments of life like marriage and childbirth.
  • Various options for premium payment i.e. monthly, quarterly, half-yearly, or annually.
  • The minimum tenure under this policy is 10 years, whereas the maximum is 35 years.
  • Unlike others, this term plan will offer the coverage up to 85 years.
  • Non-Resident Indians (NRIs) of selected countries can also take advantage of this policy.
  • For an online plan, the free look period is 30 days.
  • A grace period of 15 days is available for payment of regular monthly premiums whereas it is 30 days for other modes.
  • The amount payable as a death benefit to the beneficiary(s) is also exempted from tax under Section 10 (10D) of the Income Tax Act, 1961.

6. Aegon Religare iTerm Plan

Aegon Religare Company

Aegon Religare iTerm Plan is the most affordable yet effective pure term insurance plan that provides a lump-sum payment and regular income to the family in the event of the death of the policyholder excluding any maturity benefit. The company carries a good claim settlement ratio of 96.45% which is attracting many consumers.

Features and Benefits

  • Online availability makes it easy to invest in the same.
  • The insured will get coverage until the age of 100 years.
  • An option to increase your life cover as per your increasing life stage requirements.
  • Inbuilt terminal illness benefit.
  • It offers additional rider benefits such as accidental rider benefits and critical illness benefits as well as disability.
  • Offers the option to the avail death benefit in the form of regular income or lump sum.
  • The minimum sum assured under this plan is 25 lakhs.
  • The minimum entry age to avail the policy is 18 years.
  • It offers the option to choose the payout options as well.
  • Option to increase your life coverage as per your increasing life stage requirements.
  • Lower premium rates for females and non-smokers.
  • The Free Look period is up to 30 days.
  • Premiums paid and benefits received under the policy are tax-free under Section 80C and Section 10 (10D) of the Income Tax Act, 1961.

What Term Insurance Holds For You?

Like other investment options, term insurance holds a bunch of features that will help your family in the long run and provide a secured future. Before taking any final decision, it is important to understand all such features.

Comprehensive Cover: The plan offers a comprehensive cover to secure the future of your family, assist them in attaining financial goals and deal with all liabilities. It is a complete package at a nominal cost.

Assured Returns: Unlike other plans, term insurance offers assured returns in the hour of need and will be ready with the required financial support for your family. It will never let your family suffer in your absence.

Lifetime Cover: As an average lifespan of a human is 75 years, term insurance will definitely cover you for the same. Also, there are a few plans which offer cover till the lifetime. Under a few insurance plans, the entire amount is refunded upon maturity.

Minimum Investment: Term insurance starts at just Rs.10/day or less also. All plans are available at such low cost which makes it one of the cheapest investment options. By investing around 3 to 5% of your earnings, the returns will be around 25 to 30%.

Sum Insured: Sum insured is the amount that your nominee will receive at the time of maturity. You can easily get the coverage up to Rs.25 crores and more. You can also go for a customized plan as per your financial requirements.

Customized Riders: Like many other plans, term insurance also comes out with multiple add-on covers that you can avail at nominal additional cost to boost the basic cover. There are many options of add-on covers such as personal accident cover, critical illness, waiver of premium and much more.

Claim Benefit: You are allowed to choose the claim amount in a lump sum or in monthly installments (as per your convenience). Under a few plans, the monthly income might keep on increasing at a rate of 4% every year.

Why Add Term Insurance In Your Investment Portfolio?

With the growing inflation rate, it has become a necessity to add an adequate term insurance plan. To secure the future of your loved ones, a person should go for the best term insurance plan. There is no doubt in saying that everyone wants to secure their loved ones and provide a secure future to them. With term insurance, your family would be strong enough to deal with all financial crises in case of the demise of the insured. By making an investment in term insurance at an early age, you will feel relaxed and happy. With the same, your family would be able to deal with all financial liability and daily expenses in your absence as well. That’s why experts in the industry also suggest investing in term insurance plans at a young age. Other benefits of term insurance are listed below:-

Attain Financial Goals: You may be working on a few goals ranging from owning your house, child’s education, marriage and much more. But in case of any unfortunate incident or your demise, who will fulfill such dreams of yours and how your family would be able to attain such goals. Term insurance will be able to do the same and assist your family in fulfilling such dreams on your behalf.

Safety At Pocket-Friendly Prices: Unlike other investment plans, term insurance doesn't charge a huge amount. It offers the required financial cover at a nominal cost which makes it the best insurance plan for complete protection.

What is Claim Settlement Ratio?

Claim Settlement Ratio (CSR) is a numerical figure to determine the authenticity of an insurance company related to claims. It is calculated by using the simple formula shown below:

CSR = (Total number of claims paid during the time period)/(Total claims received)

For example, an insurer receives 1000 claims in a year, out of which 966 have been settled, 13 claims are pending for settlement and 21 claims have been rejected. Using the formula mentioned above, the insurance company has a CSR of 96.6%.

This Ratio is a significant indicator, specifically for Life Insurance (Term Insurance) plans. In the case of a claim for the death of an individual, the family wouldn’t be worried about how lengthy and problematic the process would be. The premium paid, insurance cover received, are all crucial indicators to choose a plan, but CSR should not be ignored. On an occasion when a claim is to be settled, you may have to suffer if you have chosen an insurance provider that has a CSR of less than 60%. You can collect the data by visiting IRDAI’s website or simply click at IRDAI Claim Settelment Report 2018-2019.

Let us see the IRDA Claim Settlement Ratio 2018-19 i.e.

S.No.Life InsurerClaim Settlement Ratio 2018-19 (%)
1TATA AIA Life Insurance99.07%
2HDFC Standard Life99.04%
3Max life98.74%
4ICICI Prudential Life Insurance98.58%
5LIC of India97.79%
6Bharti AXA Life97.28%
7Exide Life97.03%
8Aditya Birla Sunlife Insurance97.15%
9Reliance Nippon Life Insurance97.71%
10Kotak Life Life Insurance97.40%
11DHFL Pramerica96.80%
12Aegon Religare Life Insurance96.45%
13Aviva Life Life Insurance96.06%
14Star Union Life Insurance96.74%
15Pnb Metlife Insurance96.21%
16SBI Life95.03%
17Edelweiss Tokio Life Insurance95.82%
18Future Generali Life Insurance95.16%
19Bajaj Allianz Life Insurance95.01%
20IDBI Federal Life Insurance95.79%
21Canara HSBC OBC Life Insurance94.02%
22India First Life Insurance92.82%
23Sahara Life Insurance90.16%
24Shriram Life Insurance85.30%
  • Green – CSR 96% to 100%
  • Yellow – CSR 90% to 96%
  • Red – CSR Below 90 %

Why Sail With Online Term Insurance Plans

They offer the required financial assistance to your family in case of an unfortunate situation that includes death, disability and much more. In the case of the policyholder’s disability or critical illness, this policy offers a lump sum amount to assist the family financially. Additional sum insured is offered in case of the accidental death benefit. It also helps through the benefit received in paying off loans/debts that might have been taken during the lifetime of an individual.

Conclusion

Investing in a term insurance plan should always be in your priority list. An adequate term insurance plan will assist your family in living a stable life in your absence. With the above-stated information, the whole process of choosing the best term insurance plan has become easier for you. Invest in the best term insurance plan for your loved ones today.

FAQs

No, it is not necessary that you will get riders along with every Term Insurance Plan. It can vary according to the insurer and plans as well. A few of them might offer the same separately and a few may take care of the riders in the plan itself.

Yes, you are liable to purchase more than 1 Term Insurance policy.

In the case where you want to opt for a high Sum Assured, you have to talk to the insurance company and ask them about it. They carry a different process and first will rectify your details before proceeding further.

Yes, if you are an NRI, then also you can easily invest in a Term Insurance Plan. You can also get an exclusive plan for yourself.

You can cancel the policy by informing the insurance company within 15 days of the policy being issued.

The following documents are required to buy Term Insurance:

  • Proof of age

  • Proof of residence

  • Photo identity proof

  • Salary proof

  • Photographs

No, policyholders are not eligible for loans as the policy doesn’t come with maturity benefits, nor does it attain surrender value.

Yes, Term Insurance Plan also carries a free-look period of 15 days from the day you receive the policy document. If you cancel the policy in between this period then your amount will be refunded after specific deductions.

The policies related to late payment fee may differ from insurer to insurer, but if you make the payment within the grace period then no interest is charged on the payment.

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Last updated on 08-01-2020