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Term insurance is the purest form of life insurance that offers life coverage for a term or specific period. This term can be anything from 10 or 20 years, where the premium amount remains fixed for the coverage period.
Term insurance is a cost-effective form of life insurance and is generally less expensive than other life insurance products. Term life Insurance policies provide a high life cover at lower premiums. These premiums are fixed and can be paid a lump sum or at regular intervals for the entire policy term. Premium amount varies depending upon the type of premium payment method opted by the buyer. Term life insurance helps ensuring the family's financial goals such as paying off a mortgage, keeping a business running, or child’s higher education costs, etc. are met.
The prime motive behind opting for a Term Life Insurance plan will be to provide a safety cover for the family in case of the sudden demise of the insured. Life Insurance like this plan, thus, becomes important, whether you are single or in a relationship. In the event of an unfortunate circumstance, your family members will get the insurance coverage as death benefit. These plans are capable of providing a regular flow of income to cover not only daily living expenses but also paying off the outstanding debts such as loan EMIs, credit card bill, funeral expenses, or estate taxes etc.
Now we will go through the various benefits that you get when you opt for a life insurance term plan.
This product is ideal for covering yourself for a specific need in the long run like indemnifying a mortgage or business loan or meeting unforeseen life expenses.
Term plans provide a large amount of life insurance coverage at an affordable premium. This cover can compensate for several years of lost earnings even after the demise of the policyholder.
Some contemporary life insurance term plans also protect against critical illnesses. When a critical illness like a heart attack, cancer, kidney failure, etc. is first diagnosed, this comes as an additional benefit. Critical Illness Cover provides lump-sum payments for a small additional premium, which can be purchased as a rider cover.
A term policy provides additional pay-out in case of accidental death to increase the security of your family. For example, if your life cover is Rs. 1 Crore, a term policy with Accident Cover pays Rs. 2 Crore to your family in case of accidental death.
Some term life insurance plans pay your future premiums in case of total and permanent disability leading to loss of income. It is an appealing feature that if you are unable to pay your regular term insurance premiums because of disability, but your life insurance cover will continue. There are policies which offer waiver of a premium rider of all policy premiums in case the life assured is diagnosed with a permanent disability or critical illness.
Under Section 80 C of the Indian Income Tax Act, all term life insurance plans offer tax benefits on premiums paid up to 46,800. New-age Term insurance plans with critical illness cover also offer additional tax benefits on premiums paid up under Section 80 D.
This Term policy plan by Aegon Life is a cost-effective, comprehensive protection plan. It has an option of life coverage till the age of 100 years. You also have add-on flexibility to choose from 3 different plan options based on your protection needs. The best feature of this plan is that you can get an additional lump sum payout on diagnosis of any of 36 Critical Illnesses mentioned in the contract up to 80 years of age
This is a Non-Participating Increasing Cover Term Insurance Plan i.e., it does not have any bonus option. It provides an Increasing life cover, along with a Joint Life cover, and death benefit payments in installments. It is a smart way of ensuring your family's future
This insurance product from HDFC is an online term life insurance plan in India. It offers to safeguard the financial independence of your entire family. You can choose from 4 options of the plan – Life Option, Extra Life Option, Income Option, and Income Plus Option. Under the Income Option and Income Plus Option plans, you can arrange for a monthly income payout option for your family in your absence. You can also add riders for protection against critical illness accidental disability
This term insurance plan by ICICI Pru provides you with different protection options through affordable premium payments. It is available in 3 options, namely, Life Plus, Life Option, and Life & Health option. There is also an All in One Option that offers death benefits, premium waiver on permanent disability, terminal illness cover, accidental death benefit, and even critical illness benefit
This is also a pure term life insurance plan which offers special premium rates to women and non-tobacco users. This term policy is one of the most affordable policies to have with a premium of as little as Rs. 9 per day. You also get to choose from multiple plan options and multiple pay-out options. In case you are diagnosed with the listed 37 critical illness, you can choose the Critical Illness Plus benefit rider, which assures you the rider sum
The LIC's e-This is a pure life cover term policy that can be purchased online. The premiums need to be paid regularly annually. This is a without bonus plan.
This online term plan option by Max Life provides a secure financial future for your loved ones, against the risks of death, disease, and disability. It provides a one crore cover at a premium as low as Rs. 563 per month. It also provides tax benefits under Section 80 C, 80 D and 10(10 D) under our tax laws
This term life insurance plan provides the security cover for your partner and family, with coverage until 99 years of age. It also has options to pay limited-term premiums as well. This is a customizable online term plan that gives the flexibility to choose from 4 payout options from lump sum and income groups. The plan offers four different riders for benefits in the case of accidental death, accidental disability, serious illness, and critical illness
This is a Non-Participating pure Life Insurance term plan premium product for individuals. It provides two plan structures and two rider options. Non-smokers can avail of the benefits of low premiums. You can also avail second medical opinion from a panel of medical experts under this plan. Reasonable premiums and tax benefits under our income tax laws make it a popular product
This is a Non-Participating Life Insurance Pure Risk Premium Plan for individuals. It offers you a wide range of choices to fulfill your family's financial needs. It provides you a choice of multiple Premium Payment options and even enhances your protection with Optional Rider. It even has discounted rates for women policy buyers
Besides these top term insurance plans, there are various other add-ons and plans available with the insurance companies. You can visit the company websites to know more details about that plan. Buyers of life insurance term plan often get into the dilemma of whether or not to make a purchase. The existence of a variety of life insurance products in the market further makes the task of choosing the right insurance product daunting.
Below are the features of a term insurance plan that will provide you with a detailed view of how these plans are beneficial to you and your family.
Now that you have realized the significance of a term life insurance plan, it is necessary to delve into the details of these plans. Term insurance can be categorised into various types. You have to be very specific in your future insurance requirements before you opt for a single policy.
|Type of Term Plan||Description|
|Level Term Plans||The sum assured and payable premiums remain fixed for the entire tenure of the policy for 10-20 years.|
|TROP||The insurance company will return all the premiums that you've paid over the life of the policy at the end of the term if you survive the policy period.|
|Increasing Term Plan||Death benefits increase every year periodically during the term of the policy. The premiums of the policy do not increase.|
|Decreasing Term Plan||The assured sum payable will decrease every year until either the period of coverage ends, or the policy pays out. The premiums remain constant.|
|Convertible||A regular plan can be converted to another plan on a later date.|
|Tem Plan with Riders||This regular term plan with riders for accidental death, critical illness, disability cover, etc. by paying additional premiums.|
Here are the types of existing term life insurance plans.
Now we will go through the various benefits that you get when you opt for a life insurance term plan.
This is the simplest form of a term policy. In these types of plans, the sum assured does not change during the tenure and benefits are paid out to the nominee on the death of the policyholder.
TROP refers to a term insurance policy with a Return of Premium option. This plan is the same as any other standard term insurance policy, however, the only difference is return of premiums option These plans also ensure survival benefit at the end of the policy term. Their primary objective is to provide financial protection to your family in case of contingencies.
As the name suggests, these are term insurance policies that increase the death benefit. The premium increases, but these plans allow policyholders to pay lower premiums in the early years when they have greater expenses.
A decreasing term policy is the opposite of the increasing term insurance policy. They are also known as Mortgage Term Insurance Plans. In these plans, the death benefit amount decreases with time. Here, premiums are smaller when compared to life insurance term plan premiums. Premium payments remain the same even if benefits decline.
These plans allow a term policy, to convert into whole life or permanent insurance plan once the policy matures. The primary benefit of convertible insurance is that the policyholder doesn't have to submit a medical test, even while converting the policy to a regular life insurance plan.
With a rider cover, the basic term insurance benefits can be enhanced. A rider is an insurance policy provision that adds benefits to or amends the terms of a basic insurance policy. They provide insured parties with options such as additional coverage at an additional cost. You can buy riders for critical illness cover, accidental death cover, or disability cover. You can also choose a premium waiver benefit with a rider, in which you need not necessarily pay future premiums during emergencies
These are the various types of life insurance term plans available in the market. You need to determine your insurance objective and your financial goals before you finalize any of these.
While life Insurance term plans can be the most popular insurance products that provide an efficient life coverage as well as add-on benefits, certain things are excluded. Before buying a term policy, you need to be aware of these exclusions:
These are the exceptional cases which are not covered by life insurance policies. The buyer needs to keep these in mind while making the product purchase.
A very significant benefit of term life insurance products is that they also provide tax benefits i.e., your money invested in these policies stays tax-free. Let us check out the tax implications for the term insurance plans below.
A term policy acts as an income replacement tool for a family when the primary earner dies. However, you need to carefully consider your insurance needs rather than ending up buying a life insurance policy just to avail of the tax benefit that premium payments bring with them.
Online access has paved the way to purchase these online term insurance plans in an easy and hassle –free way. Once you have ascertained your insurance needs and determined your financial goals, you can go through the various existing life insurance term plans available in the market.
Online term plans offer the cheapest life insurance. You not only get a high life coverage but also can avail the plan at a relatively low premium. You can compare the products online based on several parameters. Once you have zeroed in on a particular product, you can log in to the company’s website and follow the steps to buy the plan online.
The process of buying online term life insurance varies across insurance companies. However, the basic steps remain the same, which are as follows:
The insurance company will get back to you within three weeks if your insurance policy has been approved by its underwriting team. This will be done after verification of your proposal form, documents, and medical reports. If your insurance request has been approved, you will receive a soft copy of the policy. This will be later followed by a hard copy. The process is easy to follow and does not require much external assistance. You can easily apply for a term policy online without any hassles.
The number of term insurance products existing in the market is numerous. In the absence of the right information, it may become complicated and confusing for the customer to compare term insurance plans and choose the right product.
You, as a buyer, have to make sure that your plan is sufficient for your family’s needs in your absence. Therefore, you need to make a term plan comparison by assessing the sources of income, the number of dependents, existing debts and liabilities, and the expenses incurred in the future to sustain their current lifestyle.
You also need to consider the amount invested periodically in these plans if you are planning for your child's education, marriage, or pension for your spouse. Let us consider some factors that can help you to compare term insurance plans online. You can make a term plan comparison and choose the right one for you by keeping the below factors in mind:
These are some of the factors that need to be carefully considered while comparing life insurance term plan policies online.
As discussed above, the insurer needs to be in good standing with a good past track record. Having said that below are some of the insurance companies offering online term insurance plans.
Life Insurance Corporation of India (LIC) is one of the oldest state-owned insurance Companies in India. They offer a wide variety of Insurance policies including Endowment plans, Money Back plans, Whole Life plans, and Term Assurance plans along with rider insurance plans. LIC Tech Plan and LIC Jeevan Amar are their popular term insurance Plans.
ICICI has been awarded as the Best Term Insurance Provider for 2017-18 by the Money Today Financial awards. It is promoted by ICICI Bank Ltd. and Prudential Corporation Holdings Ltd. This is also the first insurance company in India to be listed on NSE and BSE, with 98% CSR. ICICI Pru iProtect Smart is their bestseller plan, which can be availed at a premium of Rs 490 per month for a coverage of Rs 1 cr.
This life insurance company is a joint venture between State BNP Paribas Cardiff - a French multinational bank and Bank of India (SBI) with a 96% CSR. SBI Life-eShield term insurance offers extensive death benefit with an accelerated terminal illness benefit as an inbuilt cover.
HDFC Life is one of the leading life insurance companies in India that offers a range of individual and group insurance solutions. Its insurance products are capable of meeting various insurance needs with products such as Protection, Pension, Savings & Investment, Health, Child, and Women's plans along with the regular online term insurance plans with an outstanding CSR of 98%.
Max Life Insurance has come up with popular Insurance solutions to make life insurance plans easy, affordable, and suitable for every stage of your life. With an above 97% CSR, they have their reputation in the insurance sector.
Bajaj Allianz Life Insurance offers a vast range of financial services as well as insurance products with an excellent CSR rate of 95%. This is a joint effort extended by Bajaj Finserv Ltd and Allianz SE, a European financial services company. They offer several term policy products like Bajaj Allianz Life Smart Protect Goal, Life eTouch Online Term, Bajaj Allianz Life Secure with added covers and benefits.
This is one of the fastest-growing insurance companies in India with an impressive 97% CSR. Their popular term policy is Kotak eTerm Plan with life, Life Plus, and Life Secure options. They also provide additional riders with critical illness protection.
Tata AIA Life Insurance Company Limited is a joint venture of AIA Group Ltd. (AIA) and Tata Sons Pvt. Ltd. This is one of the fastest-growing companies in the Life Insurance sector and is ranked among the top company list, with a CSR of 99%.
This is another leading insurance provider with its presence in 150 places all over India. Their reported CSR is 96%. They provide several online Term Plan options like PNB Metlife Mera Term Plan and Mera Jeevan Suraksha Plan along with riders.
Reliance Nippon Life Insurance Company is listed among leading Indian private life insurance companies. This is one of the most significant private non-bank supported life insurers with more than 10 million policyholders. It has 727 branches and holds 97.71% CSR.
The Premium payment for your life insurance term plan plays an important role while buying a policy. These plans have a lower premium than most products, while the sum assured is higher than other insurance products. Below we check out some life insurance term plans with low premium amounts.
This term policy by ICICI Pru offers a alife coverage of Rs. 1 Crore at an affordable premium per month. The premium amounts change with the increase in tenure of the insurance policy, and your annual income at the time of application.
This term policy by HDFC is a non-linked non-participating term insurance plan that offers term coverage of Rs 1 cr. Available in 6 different plan options, the policy also offers special premium rates for female policyholders.
This term policy by MaxLife is an online term plan that offers 3 death benefit options to choose from at an affordable premium. There is an option to pay your premiums till the age of 60 years and enjoy the plan benefit till the policy term.
This life insurance term plan by the Aditya Birla Sun Life group is a non-linked non participating term plan that comes with a maturity age of 80 years. The sum assured ranges from Rs 30,00,000 to no limit, where premium can be paid with multiple paying options as per the convenience of the policyholder.
This life insurance term plan by TataAia offers insurance coverage of Rs 50,00,000 to no limit. The minimum premium is based on minimum basic sum assured, where life coverage can be availed up to 85 years or with an option for whole life cover or 100 years.
This plan by PNB MetLife offers an affordable premium for insurance coverage of minimum Rs 10,00,000 . The maximum maturity age is 99 years
This plan by Kotak Insurance offers higher coverage at a minimal premium per month for a minimum insurance coverage of Rs. 25,00,000. The maximum maturity age is 75 years.
This plan by Aviva Life Insurance offers a life coverage starting from Rs. 25,00,000 to no limit. When the plan comes with a multiple premium payment frequency, the premium rates depend on the chosen sum assured. The maximum maturity age is 70 years.
This plan by Reliance Nippon Term Life Insurance comes with multiple plan options. The Life Secure option offers a death benefit equal to sum assured in case of death or diagnosis of a terminal illness. The premium to be paid depends on the chosen life coverage. The maximum maturity age is 80 years.
This plan by Aegon Life Insurance offers an affordable premium rate to avail an insurance coverage of Rs. 1 Crore. The maximum maturity age is 100 years.