Term Insurances are the most basic and purest form of life insurance plans. In the event of unfortunate and unforeseen events, these term plans provide financial support to one’s family. In addition to providing you with financial protection, term life insurance can also cover your financial responsibilities.
However, finding a suitable term insurance plan can be challenging since not all plans are beneficial to everyone. The length of the term, the amount of coverage, and the age restrictions should all be considered before buying term plans.
To help you out, we have compiled a list of the 10 best-best term plans available in India. However, we recommend that you do your own research before making a decision.
What is the term insurance means?
A term insurance plan is actually the best type of life insurance policy. In exchange for a set premium amount, it offers financial protection for a specified period of time. If something unfortunate happens to the policyholder during the terms of insurance the insurer provides a lump sum payout to compensate for the loss.
What are the 3 major benefits of term insurance?
Here are the three major term plan benefits.
- When you are the only earning member of your family, you bear the responsibility for their well-being. If you have a term life insurance plan, you can provide for your family while you are away.
- It is important to buy term insurance plan if you have taken on a large loan that will be repaid over a long period of time. With term insurance, you’ll make sure that the loan will not create a financial burden if something unfortunate happens to you.
- Your term plan policy benefits can help your family maintain their lifestyle and achieve their goals in the event of your unforeseen death.
How many types of term insurance plans are there?
Depending on the offered benefits and facilities, term plans can be classified into 5 major categories.
- Level term insurance plan: This is the default and most common type of term insurance plans that most companies provide in India. The sum selected at the beginning remains constant throughout the whole policy term. When you buy a level term insurance plan, the lower your age at the time of purchase, the lower your premium will be.
- Increasing term insurance plan: As the name suggests, such term insurance plans allow you to increase the assured amount at a predetermined rate at some specific points during the policy term. If you want to keep up with the increasing prices, an increasing term insurance plan would be a great choice for you.
- Decreasing term insurance plan: Contrary to increasing term life plans, the insured amount here decreases over time at a predetermined rate. The idea is that as you get older your financial liabilities and the need for high term insurance coverage decrease. Those who have taken a loan that needs to be repaid soon should consider such a plan.
- Term policies with a return of premium option: It is a new and very unique type of term insurance plan that includes a savings component. Term insurance with return of premium repays all your premiums if you survive the policy term without making any claims.
- Convertible term plan: A convertible term insurance plan can be converted into a different type of insurance plan like an endowment or whole life term insurance plan. These term plans are best suited for you if you think that your financial priorities may change in the future.
What is claim settlement ratio of term insurance companies?
The term insurance settlement ratio is an important indicator of a term insurance company’s credibility. Basically, it shows what percentage of claims an insurer settles each year out of the total number of claims filed. In general, insurers with a higher ratio are believed to be more reliable.
What is solvency ratio in term insurance?
A company’s solvency ratio measures its capital in relation to the policies it has written, in other words, its risk exposure. Basically, it measures the cash flow of an insurance company in relation to the total amount of life cover that the company owes. Generally, a solvency ratio above 1.5 (or a solvency margin above 150%) is considered safe.
Which is the best term insurance?
These are some of our favorite term insurance plans that can offer you a good balance of affordability and security.
HDFC click 2 protect plus term insurance plan:
The hdfc click 2 protect term insurance offers you the return of premium facility, coverage against 36 different types of critical illness, accidental death coverage facility, and so on. So, if you are looking for online term plan, it would be the best option.
HDFC term insurance details:
|HDFC term insurance plan age limits||
|HDFC life term insurance coverage amount||
Minimum: Rs.50 lakh
Maximum: No limit
|HDFC term insurance claim settlement ratio||98.66% (For the FY 2020 to 2021)|
|HDFC term insurance premium payment term||Single, annual, quarterly, half-yearly, and monthly|
|Waiver on premium||Yes (In case of serious illness)|
Unique Benefits of hdfc term insurance plan:
- You will get three different plan options under this hdfc term life insurance plan – Basic Life Cover, Life cover + Critical illness cover, and Life cover + regular income cover.
- You can enjoy some additional benefits through the hdfc term insurance plans rider option.
- The hdfc bank term insurance plan also offers you some additional tax benefits as per the income tax act 1961.
- There is a special premium rate for women and non-tobacco users.
With over 98% claim settlement ratio, hdfc term life insurance company is one of the best life insurance companies in India. The hdfc life term insurance plans not only offer financial protection to the policyholder’s family but also cover their future financial liabilities if something unfortunate happens.
ICICI pru iprotect smart term insurance plan:
When it comes to better protection for the insured’s family at an affordable rate, the icici prudential iprotect smart term plan, ranks among the best. It lets you enjoy additional rider benefits, coverage for over 34 critical illnesses, sudden and accidental death coverage, and many more. More about the icici term plan are discussed below.
ICICI term insurance policy details:
|ICICI term insurance age limits||
|ICICI prudential term plan coverage amount||
Minimum: Rs.50 lakh
Maximum: No limit
|ICICI term insurance claim settlement ratio||97.8% (in the FY 2022)|
|ICICI term insurance premium payment term||Yearly, half-yearly, and monthly|
|ICICI term plan waiver of premium facility||Yes (in case of permanent disability of the policyholder)|
Key Benefits of icici term insurance plans:
- You can enjoy coverage upto age 99 years.
- This icici term policy comes with an accidental death coverage of Rs.2 Cr.
- You can enjoy terminal illness coverage on upto 34 critical illnesses.
- With icici iprotect term insurance plan you will get 4 payout options to choose from – lump sum, income, increasing income, lump sum plus income.
- In case of permanent disability of the icici pru policy holder, the future premiums will get waived off.
In comparison to basic term insurance policies, icici prudential term insurance plan offers enhanced protection and benefits. Additionally, its hassle-free claim settlement process, flexible payout options, and additional rider benefits make it one of the most trusted term insurance companies in India.
SBI life eshield term insurance plan:
The sbi eshield term insurance plan is one of the most affordable term life plans you can get in India. The feature that makes sbi life plan so popular is that it offers a lower premium rate to those customers who follow a healthy lifestyle. It also offers built-in accidental coverage and additional tax benefits to the customers.
SBI eshield plan details:
|SBI life eshield term plan age limits||
|SBI term insurance coverage amount||
Minimum: Rs. 50 lakh (online) & Rs. 75 lakh (offline)
Maximum: No limit (Rs.99 lakh for smokers)
|Claim settlement ratio of sbi term insurance||94.52% (as of IRDA report published on 10 February 2021)|
|SBI eshield premium payment term||Single, yearly, half-yearly & monthly|
SBI life insurance benefits:
- There are three sbi term plans options available under this scheme – level cover, increasing cover, and level cover with future-proofing benefits.
- You can enjoy coverage for upto 100 years (under the whole life plan).
- This sbi term policy comes with a terminal illness benefit of upto Rs.2 Cr is available.
- Two rider options are available with the sbi term insurance plan – 1) Accidental death benefit rider & 2) Permanent disability rider.
SBI is the name that needs no introduction, established in October 2000, sbi life term insurance company is currently one of the largest life insurance companies in India. It has an excellent claim settlement ratio of 94.52% and several branches spread across the country which makes its products easily accessible to the customers.
PNB metlife mera term plan plus:
If you want to arrange a financially secure life for your loved ones, then the pnb metlife mera term plan would be a solid choice for you. It comes with a variety of rider options that can significantly enhance your insurance policy at an affordable rate.
PNB met life insurance policy details:
|PNB metlife term insurance age limits||
|PNB metlife term plan coverage amount||Minimum: Rs.25 lakh
Maximum: Rs. 2 Cr.
|PNB metlife term insurance claim settlement ratio||98.17% (as of the FY 2020 to 202)|
|Metlife pnb term insurance premium payment term||Single, regular, or limited premium payment options are available|
|Waiver on premium||Yes (on permanent disability)|
PNB metlife term insurance benefits:
- There are three benefit options available with this pnb metlife term insurance plan.
- You can enjoy flexibility with premiums with the single, regular, or limited premium payment options.
- Joint life benefit is available under the pnb met life plan.
- In case the policyholder survives the pnb insurance policy term, he/she will receive a payout of all the premiums paid till the maturity date. (This benefit is offered as an add-on facility, and you have to pay additional premiums for it)
With a staggering claim settlement ratio of 98.17%, pnb term plan is one of the most trustworthy life insurance companies in India. The feature that makes metlife term plan so popular among customers is that its coverage is available till the age of 85 years.
Tata aia life insurance sampoorna raksha supreme plan:
If you prefer customizing your term insurance plan according to your requirements, then you would love the tata aia sampoorna raksha supreme plan. You will get 4 different plan options and a number of other useful facilities like accidental death/disability coverage, terminal illness coverage, etc.
Tata aia policy details:
|Tata aia term insurance plan age limits||
|Tata aia term plan coverage amount||Minimum: Rs.50 lakh
Maximum: No limit
|Tata aia term insurance claim settlement ratio||98.53% (as of the IRDA report of FY 2020 to 2021)|
|Tata life insurance policy premium payment term||single, monthly, half-yearly, quarterly, and yearly|
|Tata term insurance waiver of premium option||N/A|
Tata aia term insurance benefits:
- If the tata aia term insurance holder survives the tata aia policy term without making any claim, he/she will receive 105% of the total premium paid till the maturity date. This benefit is available with the Life plus option.
- Under the whole life coverage plan, you can enjoy coverage upto 100 years of age.
- There are several rider options available with the tata term policy that allow you to customize your tata aia term plan with critical illness coverage, accidental death coverage, etc.
- With the life stage benefit option, you can increase your tata aia term plan coverage amount by 25%, 50%, and 100% at different points of your policy term.
With tata aia term insurance Company, you can get the best insurance policy at a reasonable price. With great claim settlement ratios, the company offers life insurance cover to help secure your family, even after you are gone.
Kotak eterm plan:
In addition to providing you with a high level of protection, Kotak eterm plan is an economical means of providing you with pure risk cover. In addition to offering special premium rates to women, it also offers special rates to non-tobacco users. The kotak term insurance plan also offers optional riders that provide additional coverage, ensuring full protection against unfortunate events.
Kotak term insurance details:
|Kotak term insurance plan age limits||
|Kotak term plan coverage amount||Minimum: Rs.25 lakh
Maximum: No limit
|Kotak term insurance claim settlement ratio||98.50% (as per the IRDA annual report)|
|Kotak term insurance premium payment term||Yearly, half-yearly, quarterly and monthly payment options are available|
|Waiver on premium||Yes (In case of permanent disability caused by an accident) Click here for terms and conditions.|
Kotak term insurance plan benefits:
- There are three kotak term insurance payment options available – immediate payout, level recurring payout, and increasing recurring payout.
- You will get to choose among three different plan options – life option, life plus option, and life secure option.
- You can increase or decrease the total coverage amount during various stages of the term period.
- In case of permanent disability of the kotak term insurance policyholder, all the future premiums will get waived off.
Kotak term plan insurance company has featured a claim settlement ratio of 98.50%, which clearly reflects the trustworthiness of the company. Additionally, the insurer has an excellent track record in terms of claims service as well as purchase, so your family is more likely to get a smooth claim settlement.
Max life insurance smart secure plus term plan:
Designed to cope with the growing lifestyle cost, max life insurance smart term plan is a non-linked, non-participating term plan. As part of this plan, the insurer gets two death benefits: one for terminal illness and another for exit value. In addition to these benefits, this max life term plan also offers premium breaks, joint life insurance, and additional payouts on accidental death.
Max term life insurance policy details:
|Max life term insurance age limits||
|Max life insurance term plan coverage amount||Minimum: Rs.25 lakh
Maximum: Rs.3.5 Cr.
|Max life insurance term plan claim settlement ratio||99.34% (As of the IRDA report of the FY 2021 to 2022)|
|Max insurance premium payment term||Single pay, regular pay, and 5/10/12/15 pay options are available|
|Waiver on premium||Yes (in case of death, disability, and critical illness of the policyholder)|
Max life term insurance benefits:
- With max term insurance, the policyholder can enjoy a terminal illness coverage of Rs.1 Cr.
- In case the policyholder outlives the policy term without making a claim, he/she will receive the total amount of premium paid till the maturity date.
- You can also enjoy the benefits of the max life joint term insurance option.
- This max term insurance plan comes with a number of useful riders that can be useful if you want to enhance your premium plan.
If you have questions like, ‘how is max life term insurance company?’ Then just take a look at their claim settlement ratio, which is over 99%. The features that make max life term insurance so popular are the availability of online quotes, useful rider options, and special premium option for selected customers.
LIC jeevan amar plan:
The lic jeevan amar plan is a non-linked, non-profit plan designed to offer financial security to the family of the policyholder. Besides offering special premium rates for women and nonsmokers, the lic term insurance plan also offers increasing sum assured and level sum assured death benefits.
LIC term plan details:
|LIC term insurance plan age limits||
|LIC term life insurance coverage amount||Minimum: Rs.25 lakh
Maximum: No limit
|LIC term insurance claim settlement ratio||98.62% (as of IRDA 2021 report)|
|LIC term insurance premium term||Single, regular, and limited premium payment options are available|
LIC term insurance benefits:
- There are two death benefit options available – 1) Level sum assured, 2) Increasing sum assured.
- Women and non-smokers can enjoy special premium rates.
- You can enjoy the flexibility of premium with single, regular, and limited premium payment terms.
LIC is one of the top term life insurance companies (if not the best company) in India with an excellent claim settlement ratio of over 98%. Over the decades, it has become a household name among Indians mostly because of its affordable interest rates, multiple claim payout options, and special premium rates for women and non-tobacco users.
Bajaj allianz life etouch plan:
The bajaj allianz life etouch plan is an online term insurance plan with regular premium payment options. Depending on the variant opted by you, this term insurance offers life cover with benefits for accidental death, accidental total permanent disability, and critical Illnesses, as well as the waiver of premiums facility.
Bajaj allianz life insurance policy details:
|Bajaj allianz term insurance age limits||
|Coverage amount||Minimum: Rs.50 lakh
Maximum: No limit
|Bajaj allianz term insurance claim settlement ratio||99.02% (as per the IRDA report of the FY 2022)|
|Bajaj allianz term insurance premium payment term||Yearly, half-yearly, quarterly and monthly|
|Waiver on premium||Yes (in case of total permanent disability caused by an accident)|
Bajaj allianz term life insurance benefits:
- Policyholders can enjoy tax benefits under the income tax act.
- You can enjoy coverage against death and terminal illness.
- In case of permanent accidental disability of the bajaj policy holder, all the remaining future premiums will get waived.
- You can enjoy yearly, half-yearly, quarterly, and monthly premium payment options.
- This bajaj allianz term insurance plan comes with a unique feature called a premium holiday, it allows you to skip your premiums for 1,2, or 3 years during the premium payment term.
A claim settlement ratio of over 99% shows the trustworthiness of bajaj allianz life insurance company. Additionally, with some unique and useful features like terminal illness coverage, accidental death benefits, and premium waiver options, bajaj allianz life insurance is fully capable of ensuring the policyholder’s financial freedom.
Aditya Birla Life Shield Plan:
In terms of life coverage and affordability, the Aditya Birla Sun Life shield plan is one of the best term insurance plans available in India. It gives you the flexibility to combine various plan options to suit your family’s needs so they do not have to compromise on their lifestyle while you are away.
|Aditya birla term insurance age requirement||
|Aditya birla term plan coverage amount||Minimum: Rs.25 lakh
Maximum: No limit
|Claim settlement ratio||98.08% (as of the IRDA report of the FY 2021 to 2022)|
|Premium payment term||Yearly, semi-yearly, quarterly, monthly|
|Waiver on premium||Yes (in case of total and permanent disability of the policyholder) Click here to find the details.|
- You will get 8 different plan options to choose from.
- You have the option to pay your premiums yearly, half-yearly, quarterly, or monthly.
- You are allowed to increase your total coverage amount at different points of the policy term.
- If the policyholder outlives the policy term without making any claim, he/she will receive the total amount of premium paid till the maturity date.
- There are three claim payout options available – lump sum payment, staggered payment with increasing annual income, and staggered payment with fixed annual income.
- If the policyholder is diagnosed with a terminal illness, he/she will immediately receive 50% of the sum assured (upto Rs.2.5 Cr.) and will also get the future premiums waived off.
When it comes to the best term insurance companies in India, Aditya Birla always books a spot. In addition to having an impressive claim settlement ratio of 98.08%, it comes with useful benefits such as flexible premium terms, return of premium options, terminal illness coverage, and different payout options.
- How to choose best term insurance plan in India?
These are some factors that you should take into consideration before choosing a term plan.
- Your dependence and current age:
Your age and current financial situation determine the best term plan for you. In addition, it influences what should be the duration of a term insurance plan, and the amount of coverage that is suitable for the policyholder.
- Your lifestyle:
Your lifestyle includes your spending habits and your liabilities. So it is important to have a clear idea about your lifestyle requirements, it will help you to find the best term plan for yourself.
- Your liabilities:
If you have taken a long-term loan that is going to be repaid over a long period, then your policy term should cover the repayment period. Otherwise, it can create financial difficulties for your family.
- Claim settlement ratio:
Term insurance claim settlement ratio is the primary indicator of an Insurance company’s trustworthiness. It is the percentage of claims an insurer settles each year out of the total number of claims filed.
- Critical illness and accidental death benefits:
A critical illness such as cancer or brain surgery can create huge financial stress on your family. term insurance critical illness cover saves you and your family from those difficulties by offering instant payout with minimal verification requirements.
Also, if you have selected the death insurance plan, your family members will receive an additional payout if something unfortunate happens to you.
- Term plan premium waiver option:
In the event of a terminal illness or permanent disability caused by an accident, all future premiums will be waived by the insurance company. It is a very useful feature to have.
When choosing a term plan, a policyholder should keep in mind why he/she is taking it. Additionally, he/she should take into account the benefits of all the different term plans before selecting one
Disclaimer: I am not a certified financial adviser and this is not financial advice. The purpose of this article is to inform you about financial products and strategies. Consult your financial advisor before making any financial decisions.
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