Himanshu Kumar
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Himanshu

Himanshu Kumar

Term & Life Insurance

Himanshu is a content marketer with 2 years of experience in the life insurance sector. His motto is to make life insurance topics simple and easy to understand yet one level deeper for our readers.

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Bijendra Singh

Bijendra Singh

Term Insurance

Bijendra Singh with his 9 years of experience in the term insurance sector, has been instrumental in designing customer-centric sales programs. His passion towards innovation strives to achieve organizational objectives while driving sustainable growth in the competitive insurance landscape.

Updated on Mar 30, 2026 6 min read

What is a Single Premium Term Plan?

A single premium term plan is a type of life insurance policy that requires the policyholder to pay the entire premium in a single payment, rather than making regular payments over time. This kind of policy offers protection for a predetermined term, usually between 10 to 30 years, and pays a death benefit to the selected beneficiary if the policyholder passes away while the policy is in effect.

The premium for a single premium term plan is generally lower compared to a regular term plan with the same coverage amount and term because the insurer does not have to worry about collecting premium payments over time. However, the policyholder is required to pay the entire premium upfront, which can be a significant financial burden for some individuals.

Best Single Premium Term Insurance in 2025

We have curated a list of the best single premium term insurance plans in 2025 that you can consider for buying.

Name of the planEntry AgeTenureSingle PremiumUnique Features
Max Life Smart Total Elite ProtectionMinimum Age- 18 years
Maximum Age- 65 years		5 to 67 yearsRs 2,04,822Special exit value, Inbuilt terminal illness cover, Insta Payment on claim intimation
ICICI Prudential iProtect SmartMinimum Age- 18 years
Maximum Age- 65 years		5 to 40 yearsRs 2,00,589Long-term cover, Life-stage benefit, 4 payout options
HDFC Life Click 2 Protect SuperMinimum Age- 18 years
Maximum Age- 65 years		5 to 85 yearsRs 1,96,961Flexibility to choose multiple coverage options, Option to increase cover at key stages, Option to extend policy tenure
ABSLI DigishieldMinimum Age- 18 years
Maximum Age- 65 years		5 to 40 yearsRs 1,91,788Affordable premiums, Flexible policy tenure, 2 plan options
SBI Life eShield NextMinimum Age- 18 years
Maximum Age- 65 years		5 to 100 yearsRs 2,01,185Choice of 3 plan options, Terminal illness benefits, Multiple premium payment options

* In the above table the premiums shown belong to a 30-year-old non-smoking male for a policy term of 30 years and the premium payment term is single pay with a chosen sum assured of Rs 1 Crore.

When to Opt for Single Premium Term Insurance?

Single premium term plan or one-time premium term plan is a great option in term insurance, but it is not for everyone. There are certain things you must consider before opting for a single premium term insurance policy.

  • You have a lump sum of money

    If you have a large amount of money available, paying the premium upfront in a single lump sum can be a convenient option.

  • You want to save on premium payments

    A single premium term plan typically has a lower overall cost compared to a regular term plan with the same coverage amount and term.

  • You wish to avoid the hassle of making regular payments

    With a single premium term plan, you only have to make one payment and do not have to worry about making regular payments over time.

  • You have a short-term coverage need

    If you only need coverage for a short period, a single premium term plan can be an economical option.

Eligibility and Documents Required for a Single Premium Term Plan

Eligibility criteria and the required documents needed for a single premium term insurance plan vary between insurance companies. The following are the common eligibility criteria and documents that are asked by insurance companies:

Eligibility

  • Age

    Most insurance companies require the policyholder to be between 18 to 65 years old to apply for a single premium term plan.

  • Health

    The policyholder must be in good health and free from any pre-existing medical conditions.

Documents Required:

  • Identity Proof

    A government-issued photo ID such as a passport, driver’s license, or PAN card.

  • Address Proof

    A utility bill, bank statement, or rental agreement that shows your current address.

  • Income Proof

    Proof of income such as salary slips, tax returns, or bank statements.

  • Medical Reports

    Depending on your age and health, you may be required to undergo a medical examination and provide the results.

Although these are the main things required, it’s important to check with your term insurance company for specific requirements and to provide accurate information when applying for a single premium term insurance plan. Providing false information can result in the rejection of your claim in the event of an unfortunate event

Benefits of Buying a Single Premium Term Insurance Plan

People opt for single-pay term insurance as it offers several benefits to the policyholders such as:

  • Lower Premium Cost

    A single premium term plan generally has a lower overall cost compared to a regular term plan with the same coverage amount and term.

  • Convenience

    With a single premium term plan, you only have to make one payment and do not have to worry about making regular payments over time.

  • Easy To Budget

    With a single premium term plan, you can easily budget your insurance expenses since the entire premium is paid upfront.

  • Life Coverage

    A single premium term plan provides life coverage for a specified term, typically ranging from 10 to 30 years. In the event of the policyholder’s death during the term of the policy, the designated beneficiary will receive a death benefit.

  • Flexibility

    Some single premium term plans offer the option to convert the policy to a permanent life insurance policy, such as whole life or universal life, without having to undergo a medical examination.

  • Tax Benefits

    The premiums paid for a term insurance policy are eligible for tax benefits.

Disadvantages of Single Premium Term Insurance Plan

While a single premium term insurance plan has several benefits, it also has some disadvantages, including:

  • Limited Coverage

    A single premium term plan provides coverage for a specified term, typically ranging from 10 to 30 years only.

  • No Premium Refunds

    Once the premium is paid, it cannot be refunded, even if the policyholder cancels the policy or outlives the term.

  • Large Upfront Payment

    The premium for a single premium term plan must be paid in a single lump sum payment, which can be a significant financial burden for some individuals.

  • Limited Options

    Some insurance companies may have limited options for single premium term insurance policies, making it difficult to find a policy that meets your specific needs.

  • No Policy Loans

    Unlike some permanent life insurance policies, single premium term insurance plans do not offer the option to take out a loan against the policy’s death benefit.

Tax Benefits of Single Premium Term Insurance Policy

Single premium term insurance policies offer several tax benefits that can help policyholders save money and potentially reduce their tax liability:

Premium Tax Deduction

The premiums paid for a single premium term insurance policy offer tax benefits under the Income Tax Act.

Tax-Free Death Benefit

The death benefit received from a single premium term insurance policy is typically tax-free. This means that the beneficiaries of the policy will not have to pay taxes on the death benefit they receive.

Final Thought

Overall, single-premium term insurance is a good option for people who are looking for a convenient way to secure life insurance coverage for a set period, but it’s necessary to carefully weigh the pros and cons before purchasing a policy. It’s important to keep in mind that a single premium term plan is a long-term commitment, and once the premium is paid, it cannot be refunded. Before deciding to purchase a single premium term insurance policy, it’s important to carefully consider your financial situation and determine if it’s the best option for your needs.

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1. How to calculate a single premium?

A single premium is the one-time payment you make to fully fund an entire life insurance policy. To calculate the premium for the applicants, insurers consider factors such as sum assured, age, policy term, plan type, and health. Most insurers provide digital calculators to estimate the single premium on the basis of these factors.

2. Is TDS deducted on a single premium policy?

Yes, TDS (Tax Deducted at Source) may apply to single premium life insurance policies if the death benefit proceeds are ₹5 lakh or the maturity proceeds. TDS is generally deducted at 5% under Section 194DA. In contrast, if the proceeds are tax-exempt under Section 10(10D), TDS may be inapplicable.

3. What are the tax benefits of single premium life insurance?

Premiums paid as a single premium are perfectly eligible for tax deductions under Section 80C of around ₹1.5 lakh per year. In addition, the death benefits and maturity benefits are usually tax-free under Section 10(10D), provided that the policy has a sum assured of at least 10 times the premium.

4. Is 80C applicable for a single premium policy?

Yes, Section 80C is applicable to a single premium policy. The whole premium counts towards the ₹1.5 lakh annual limit, in contrast to regular premium plans, where the premiums are spread over years. For 80C, the policy must have a minimum sum assured that is 10 times the premium for non-linked plans.

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