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Top Reasons for Buying an Online Term Plan

Life is full of uncertainties, and a breadwinner needs to get term insurance done in order to secure his/her family’s future.

Term insurance covers the family of the insured after his/her death due to illness or accident. To ensure that loved ones and family members do not go through any hassles if the earning member of the family is not anymore, one must invest in a solid term insurance plan.

Thanks to Technology, these days, many of the best Insurance companies in India are on the digital platform, exhibiting the best term insurance plans that can be customized as per ones/needs and demands. Buying term insurance online is the most appropriate way to buy a term plan as it saves time, effort, and money to speak to many agents, understands different plans, comprehends the best policy by strategic comparisons, and above all, incessant tackle follow-up done by agents. 

It is highly recommended to buy an Online Term Plan to avail maximum benefits.

Advantages of Term Plan Insurance

Term insurance plan comes packed with many advantages, features and benefits. Some of the main advantages of term insurance plans are discussed below:

  1. Financial Security for the Family

    In case of the untimely death of the bread earner of the family, there is financial stability that a term plan can offer to the insured's family and dependents that even after he is not there, their financial needs are taken care of.

  2. Long-term Goals

    Objectives and goals of long-term planning benefits can also be derived from a term plan insurance, which ensures a good amount to be disbursed after investing in it till the time an earning is made by the insured. After the income stops, these savings can help him survive in his later years when he is old and unemployed.

    A term life insurance is an essential part of your financial plan. It provides stability to your financial plan and ensures that your dreams and the dreams of your loved ones are not unfulfilled due to any unfortunate incidents in your life.

  3. Debt Repayment

    As a part of long term goal, in case of huge debts like education, new business, or even marriage of children, this investment can come handy in the form of a term plan that can help the insured lay-off his huge debts.

    The term plan acts as insurance against the outstanding debt and in case of an unfortunate fatal event befalls the insured, the term insurance plan kicks in and clears the debt so that the kin of the insured does not have to bear the burden of the outstanding debt. Most loans like housing loans usually do attach a term life insurance equal to the outstanding debt as a part of the loan.

  4. Retirement Objectives

    Term plans can be beneficial in fulfilling retirement benefits like regular inflow of finances, even when the insured is out of employment after a certain age. You may opt for many options like Return of premium or fixed/increasing income plans where you get maturity benefits as a part of the term insurance plan depending upon the option you selected. However, such options are not available in all term plans.

  5. Tax Benefits

    Under section 80 D of the Indian Income Tax Act 1961, one can derive tax benefits out of the term insurance policy he applies for.

Examples of Online Term Plans:

For example, if a 30-year-old man wants to get term insurance of Rs 1 Crore with a duration of 30 years, what online options can he get?

***The sum insured quoted include service tax***

Insurer Term Plan offered Premium (Rs p.a.) Renewal age Riders available Key features
Aditya Birla Sun Life Insurance LifeShield Plan 9965 85 5
  • 8 plan variants/options to choose from
  • Insure self and spouse under the same policy
  • 5 add-on riders to select from
  • Return of premium option
  • Critical illness benefit
  • Max. entry age – 65 years
Aegon Life Insurance iTerm 10692 100 4
  • 3 plan variants to choose from.
  • 4 add-on riders to enhance your cover
  • Dual benefit option offers monthly income on maturity
  • Max. entry age – 65 years
Bajaj Allianz General Insurance Life Cover 13812 99 4
  • 3 plan variants to select from
  • 4 add-on riders to enhance your cover
  • Critical illness cover
  • Cover self and spouse under one policy
  • Children education extra cover
  • Return of premium feature available
Canara HSBC OBC Life Insurance iSelect 20368 99 0
  • 3 plan variants available
  • Accidental death benefit
  • Non-working spouse benefit
  • Max. entry age – 65 years
Exide Life Insurance Exide Life Smart   75 2
  • 3 policy variants to pick
  • Critical illness, and accidental death, disability benefit riders
  • Return of premium option
  • Max. entry age – 60 years
Edelweiss Tokio Life Insurance Protection Plan 8208 80 3
  • 4 plan variants available
  • Accidental death, disability and critical illness add-on riders
  • Better half benefit in case of death of the insured
  • Max. entry age – 60 years
Future Generali India Insurance Future Generali Flexi Online Term- Lumpsum 5840 75 1
  • 4 standard variants
  • Create your plan option
  • Accidental benefit rider available
  • Fixed income & increasing income plans available
  • Lower premium rates for women
  • Discount on high sum assured plans
HDFC Standard Life Click2protect plan 8641 75 1
  • Flexible policy terms and tenure
  • Lower premiums for female insured
  • Lower premium rates for non-tobacco users
  • Multiplier benefit
  • Stay active benefit
ICICI Prudential Life Insurance iProtect Smart Lumpsum 12970 99 2
  • 4 variants to opt from
  • Accidental benefit and accelerated critical illness riders available
  • Critical illness covered
  • Lower rates for non-tobacco users
  • Max. entry age – 65 years
IndiaFirst Life Insurance e-Term Plan 5064 65 0
  • 8 variants to choose from
  • Withdraw upto 10% from the plan for major life events
  • Accidental death and disability cover
  • Critical illness cover
Kotak Life Insurance e-Term 7848 75 2
  • 3 variants of the plan to choose from
  • Permanent disability and critical illness riders to enhance your cover
  • Reduced premiums for non-smokers and women insured
  • Max. entry age – 65 years
LIC e-term 16644 75 0
  • Backed by Govt. of India
  • Single variant only
  • No riders available
  • Max. entry age – 65 years
Max Life Insurance Smart Term Plan Life Cover 6852 85 1
  • 7 different variants
  • Discounted premiums for higher sum assured plans
  • Accident cover rider
  • Reduced premiums for females insured
  • Loyalty discount
  • Max. entry age – 65 years
PNB Metlife Life Insurance Mera Term Plan  8459 75 3
  • 4 variants to select
  • Critical illness, accidental death, disability and accelerated sum assured riders available
  • Max. entry age – 65 years
Reliance Nippon Life Insurance Reliance Digi-Term 9331 65 0
  • Multiple plan options to select
  • Premium benefits for maintaining a healthy lifestyle
  • Options to increase cover available
  • Max. entry age – 65 years
SBI Life Insurance eShield 7068 80 2
  • 2 variants available
  • Accidental death and total permanent disability riders available
  • Medical second opinion covered
  • Max. entry age – 65 years
Tata AIA Life Insurance Tata MahaRaksha Supreme 11124 85 2
  • Built-in pay-out accelerator
  • Multiple pay-out options available
  • The reduced premium for non-smokers and females insured
  • Max. entry age – 65 years.

Disclaimer: Paisawiki does not rate, endorse or recommend any specific insurance provider or insurance product offered by any insurer.

The above-listed plans share some commonalities when it comes to features. It is essential that you are aware of the most common set of features offered by almost all term plans available while selecting the right policy for you so that you can zero in on the right one.

Benefits of Online Term Insurance Plans

Most term plans have the following benefits covered as a part of their standard offerings:

  1. Death Benefit

    Up until maturity, if the insured meets with an unfortunate and untimely death, the sum assured will be passed onto the nominee.

  2. Accidental Death and Disability Riders

    Most term insurance plans provide an option to add-on this rider for a small increase in your annual premium. As per the terms of this rider, the nominee can claim the accidental death benefit if the insured meets with accidental death or permanent disability due to an accident.

  3. Critical Illness Rider

    Most insurance plans also offer an add-on rider for covering critical terminal illnesses. The specific medical conditions covered and the process shall be detailed in the policy terms and conditions.

    Apart from these common covers, specific benefits offered by the term insurance plans vary from one policy to another. You must read the policy prospectus/brochure carefully and get expert advice, if required, before taking long term decisions. 

Features of Online Term Insurance Plans

Some additional features and benefits offered by some plans are:

  1. Return of Premium

    Many term plans come with an option where you can get back the complete premium amount you paid at maturity of the policy for a small increase in your premium amount. Using this option provides you with the combined benefit of insurance and savings.

  2. Income Protection

    Many term plans also offer the option to opt for fixed or increasing income returns in place of death benefit after the policy maturity. This option provides you with the dual benefit of having secured yourself with a term plan during your youth which gets converted to a source of income at a later stage of your life.

  3. Protect your Partner

    Most term plans also offer you the benefit of covering your partner under the same term insurance plan so that it provides complete protection to your family in the future.

  4. Premium Benefits

    Many term insurance plans also offer premium benefits that encourage you to lead a healthy lifestyle and for women to get themselves insured.

Which Insurance Company to Rely on?

The true meaning of insurance is Term Insurance. Evaluate and consider the best insurance plans by strategically analysing companies and their plans online. Certain parameters to be considered while choosing the best insurance company to invest in for purchasing the apt terms plan from are:

  • Sum Insured
  • Policy Term
  • Claim settlement ratio
  • Incurred Claims Ratio
  • Premium to be paid
  • Add on benefits

There are several prominent insurance companies in India all operating under the regulations of IRDAI. While selecting a term plan, one must remember that a term plan is a long-term commitment that could last for decades. This decision should be made after careful due diligence and in a manner to get the most value for your money.

Being stuck in the wrong term plan could derail your insurance and investment strategy and may force you to change your insurer after a few years which will add to the costs of your insurance. It is also great if you start your plan as early in life as possible, once you become financially independent. Premiums are much lower when you are young and that is the time when you should be insured the most as you have a full life of possibilities ahead of you.

It is also important to get a background of the various plans available, compare them in terms of features and cost, avail the advice of experts if required, do online research and plan your insurance purchase. You should have an insurance strategy which fits in well with your overall financial strategy for life.

Also, consider the flexibility built into the plan. If your financial situation changes in the future then an insurance plan should provide enough legroom for you to adapt it in your new financial plan. A fixed and rigid insurance plan could force you to switch it at a later stage for a more flexible term insurance plan.

The reputation of the company does matter since it is an investment stretching into decades. You want to be assured that you will continue to get the best service for years and years without hassles. Parameters like claim settlement ratio provide a glimpse of how good an insurer is when it comes to settling claims under the insurance plan.

Key Reasons to Buy Online Term Insurance Plans

Technology has made it very convenient for individuals to research various insurance options available online and choose the policy that is best suitable as per his needs. Some of the common benefits derived from purchasing an online term plan are:

  1. Lower Cost 

    Buying an online term plan gives a huge advantage in lower cost as the agent commission, communication, and commuting costs are cut down. There is a direct deal between the insurance company and the individual. Approximately, the cost difference is from 40-50% as it does not cover the middleman's commission and fees. Also, insurance companies believe if the individual is buying an online term plan insurance policy, the mortality rate is also less in such cases. 

  2. Flexibility 

    The customer has the advantage of customizing the term plan as per his demands, needs, desires, and expectations. He can choose between add on, top-ups, and extended riders he would want to buy along with his plan.

    Various modes of payments and pay-out options make term insurance plans really flexible. You can easily customize your plans online with the click of a few buttons. This helps you get exactly the kind of insurance, which you were looking for.

  3. Claims Settlements become Easier

    As easy as it is to buy an online term plan, similarly, claiming settlements are equally easy and user-friendly. Instead of going through the hassles of contacting the agent frequently for the status of the claim, one can also check online. Also, in case of ineffective delays in claim settlement, IRDA has issued the right for the insured to file a complaint to the Insurance Ombudsman to look into the matter and to expedite the claim settlement procedure.

  4. Higher Sum Assured

    As compared to an offline policy, the insured gets the benefit of a higher sum insured and assure while purchasing and online term plan. Alternately, many plans also offer premium benefits upon selecting higher sum assured.

  5. Better Disclosures and Complete Transparency

    There is no hidden information. Agents tend to hide negative information, which may impact the customer at some point in time. Still, while purchasing an online policy, there is no such contingency, and complete transparency is maintained in the policy document.

    You can easily compare plans and get the latest information published by your insurer at the click of a few buttons. Buying insurance online helps you gain a better insight into the insurance options available and you get the inputs needed to make the best decision.

  6. 24*7 Customer Care Service

    Online customers have several ways to interact with the customer care department of any respective insurance company if the policy is through an online portal. Instead of getting bothered by making umpteen calls to a specific agent, it is easier to have access to a 24*7 customer care helpline number, email access, and message service to the insurance company to resolve issues. 

  7. Effective Comparisons

    The best part about buying an online term plan insurance is a comparison of a multitude of insurance companies and their myriad of term insurance plans available. Each plan could be different in terms of benefits, premiums, costs, claims, the sum assured, and extra benefits. The individual has the choice to research all given options, compare each one, and select the best policy as per his need and comfort.

  8. Lower Premium 

    Just like a higher sum assured, the lower rate of premium is available for the insured to be paid towards the insurance company, considering no extra cost of the agent.

  9. DIY or the Do it yourself Policy – Self-service and Customer Empowerment

    It is a self-service application, and the customer needs to be smart enough to plan, scrutinize, and critically analyse each option. The complete responsibility of the term plan purchase lies on the customer, thus empowering him to be his boss and select the best deal for himself.

  10. Easy Accessibility and Rep Check

    It is more comfortable for the insured to do a quick reputation and goodwill check of each insurance company and get easy accessibility to all vital information regarding the company and its policies. The terms and conditions of each policy are clearly stated ad the customer should be smart enough to read them diligently and accept it with the car.

Difference between Offline and Online Term Plan:

Points of difference Online Offline
Intention Clear intention to buy, so he will choose the plan that best suits his needs Intention To sell so that the motive would be a hike agents commission rather than the customer’s advantage
Cost Low cost, Low premium, and High sum Assured High cost as it involves the agent’s fees, charges and commission, high premium and thus a low sum assured
Choice of product His/her own Recommended by the agent
Saves time and effort Yes, with a hassle-free experience N, incessant meetings and conversations with the agent can confuse and tire the customer
Responsibility, answerability, or clarification. The Insured is completely responsible for everything as he is the sole person to comprehend the policy and buy it. Agent helps
Human interaction eliminated

The direct deal between the insurance company and the insured

Interaction with the agent can be exhausting.
Fraud Least chances of any fraud More chances of getting conned

Recommendations while Purchasing an Online Term Plan

  • Always make a good comparison.
  • Read the terms and conditions very carefully.
  • Look for riders and add on benefits.
  • Always lookout for a financial consultant to give the right suggestion.
  • Make your payments don’t give PAN card or financial details to anyone.
  • Make a thorough check using all modes of communication.
  • Insurance is based on ‘uberrima fides’, which means utmost good faith so one must disclose all relevant information, medical and health-related facts.

FAQ's

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