Short Term Insurance Plans
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  • Lower Premiums
  • Rider Protection
Short Term Insurance Plans
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Short Term Insurance Plans: Benefits, Coverage & Eligibility

Do you think life insurance is a long term commitment? Then you must haven’t heard about short term insurance plans. As the name suggests, these plans provide life coverage for a very short period of time which might range from 5 to 10 years.

Since the tenure is very short, the premiums are lower, and thus the premium payment term is short too.

Let us learn about these plans in detail.

What is Short Term Life Insurance

To put it simply, short-term life insurance plans offer life cover for a short duration of term. Like the term insurance plan, it provides death benefits to the nominee when the policyholder passes away during the policy tenure.

Unlike life insurance, there is no way you can grow your money or any savings component in short-term life insurance. Whether you're on a short stay in India due to professional work or are an individual with limited financial capacity who wishes to have life security, short-term life insurance is the suitable option for you.

Short Term Life Insurance Plans for all Age Groups

We've compiled the list of the top 5 short-term insurance plans in India for a person aged 25 years old, who is a non-smoker earning 5 lacs or above income annually, and looking for insurance coverage of 50 Lakhs till 5 years.

Short-term Insurance Plan Entry Age Life Cover Policy Term Monthly or Annual premiums
Edelweiss Tokio Saral Jeevan Bima 18 - 65 years 50 Lakhs 5 years Rs. 465/month
Rs. 5,277/year
Aegon Life iTerm Prime 18 - 65 years 50 Lakhs 5 years Rs. 483/month
Rs. 5,550/year
ICICI Prudential Saral Jeevan Bima 18 - 65 years 50 Lakhs 5 years Rs. 701/month
Rs. 8,205/year
HDFC Life Saral Jeevan Bima 18 - 65 years 50 Lakhs 5 years Rs. 1,101/month
Rs. 12,579/year
PNB MetLife Saral Jeevan Bima 18 - 65 years 50 Lakhs 5 years Rs.1,275/month
Rs. 14,396/year

Key Features of Short Term Insurance Plans

There is no harm in having a short term insurance plan to secure your family if you do not wish to buy a term plan for a longer period. You might need coverage just for some years when you have a loan going on so that if something were to happen to you your family can pay it off using the death benefit.

There are a few other benefits associated with buying short-term insurance such as:

  1. Guaranteed protection

    Despite a short tenure, the policy still pays the promised death benefit to the nominee which can be used to pay off debts, maintain living standards, and fulfill the objective the policy was bought for.

  2. Optional Riders

    In exchange for very nominal additional premiums, you can buy yourself an optional rider with a short term insurance plan as well. Please note that you can only add a rider to your plan when purchasing the short term insurance.

  3. Tax benefits

    With a short-term life insurance policy, you can maximize your tax savings under a few sections of the income tax laws.

    • Under Section 10 (10D) of the Income Tax Act 1961, death benefit or maturity benefit is tax-free. So, your nominee can use the entire amount you leave for them without any tax deductions.
    • Under Section 80C of the Income Tax Act 1961, you can claim tax deductions of up to Rs. 1.5 lakhs annually for the premiums paid towards the policy.
  4. Affordable premiums

    Unlike other life insurance products, a short-term insurance policy offers the benefit of life cover for relatively lower premiums. This is because the plan has a short policy duration; therefore, the premium is also affordable for these policies.

Who Should Buy Short Term Insurance Plans

Life is unpredictable, so there could be many instances where you may need temporary insurance coverage. Purchasing a short-term insurance plan would be best for the following individuals-

  • Professional workers who are switching jobs.
  • People who are on a short stay in India.
  • Someone with limited financial capacity who wants to have life security.
  • For those who need a quick cover for a couple of years.
  • Youngsters in their 20s who are starting their careers and want short affordable life cover.

Documents Required to Purchase Short Term Insurance Plans

While purchasing short-term life insurance, policy buyers have to submit a set of documents to their insurer.

Here, we've mentioned the list of mandatory documents to buy a short-term life insurance policy irrespective of age & gender.

  • Identity Proof
  • Address Proof
  • Income Proof
  • Medical Reports
  • Employee - 3 months salary slip and bank statements of salary crediting
  • Self-employed - ITR of the last 3 years with Computation of Income (COI)
  • Two passport-size photographs
  • Policy invoice number and coverage of pre-existing insurance policies (if any).

Term Insurance Companies

Check and compare plans from 21 IRDAI-approved term insurance providers before purchasing a term plan.

Conclusion

Since no one can predict the future, it's better to get an insurance plan even for the short term. However, the only difference between short-term and term insurance plans is that they provide temporary coverage for a short duration. It has relatively lower premiums as compared to other life insurance products.

Short Term Life Insurance: FAQ's

1. Can we take short-term insurance for 6 months?

No, a short-term insurance plan is valid for more than 5 months.

2. How long is short term life insurance duration?

Short-term life insurance provides life cover for a limited term and generally, the policy tenure ranges from 5 to 10 years.

3. What are the disadvantages of short term insurance?

Short-term insurance plans do not renew automatically and it needs frequent renewals.

4. Why is it called short-term insurance?

A short-term insurance policy is a contract between the insurer and policyholder offering temporary coverage for a shorter period. And thus, it is called short term insurance.

5. What are the benefits of short-term insurance?

Apart from a life cover in your absence, a few other benefits are associated with buying short-term insurance, such as guaranteed protection, tax benefits, lower premiums, optional riders, Etc.

What Our Customers Have to Say

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Sanjeev

Hyderabad

May 20, 2024

SUD Life term plan truly stands out my expectations as I got SUD Life term plan along with additional riders at very affordable premiums.

Customer Review Image

Sumit

Coimbatore

May 20, 2024

I am impresses with the hassle free and quick claim settlement process of SUD Life. Thanks to PolicyX who guided me to get my claim settled.

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Barkha

Delhi

May 20, 2024

Bought SUD Life Family Income Benefit Rider plan to secure the future of my plan financially even in my absence.

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Geetanjali

Kolkata

May 20, 2024

I was looking for a term plan to secure the future of my family. So I contacted PolicyX and one of their representatives Mr. Vaibhav helped me choose SUD Life term plan.

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Armaan khan

Agra

May 17, 2024

I recently purchased a Pramerica term insurance policy from Policyx.com. The customer service team was very helpful in answering all my queries and guiding me through the application process. I...

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Rahul Yadav

Indore

May 17, 2024

PolicyX’s dedicated support made renewing my Bandhan Life Insurance policy easy. I’m absolutely delighted with the service offered by PolicyX Insurance Advisor.

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Priyanshu Sharma

Delhi

May 17, 2024

I bought a Bandhan Life Insurance through PolicyX, and I must say the level of communication and assistance I have received has been truly impressive.

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Yash Tomar

Bhopal

May 17, 2024

After getting advice from the PolicyX experts, I chose a Bandhan Life Insurance term plan. Thank you, PolicyX, for helping me buy a term plan at such a low premium.

Sahil Singh Kathait

Written By: Sahil Singh Kathait

Sahil is a passionate content writer with over two years of expertise in the insurance domain. He uses his knowledge in the field to create engaging content that the customer can relate to and understand. His passion lies in simplifying insurance terminology, ensuring a hassle-free understanding for potential policyholders. With his outstanding collaborative efforts with people, he understands different perspectives and keeps readers' viewpoints at the forefront of his content writing approach.