7 Factors to Consider When Buying Life Insurance

Life insurance is more than just a financial product. It is a long-term promise to protect your loved ones when they need it the most. Whether you are just starting a family, planning for your child's education, or thinking about a peaceful retirement, a life insurance plan can provide the financial support your family may need in your absence. However, choosing the right life insurance policy can feel overwhelming. There are many options, and it is important to understand what truly matters when making this decision.

51 Partners Insurance Partners

12.02 Crore Registered Consumer

5.9 Crore Policies Sold

We are rated ++ rating

₹1 Crore Life cover starting from ⁺

Lowest Price Guarantee ^˜

Male

Female

Name

Date of Birth

Mobile Number

Check Your Premium Now

Get Updates on WhatsApp

To help you make the right choice, here are seven key factors to consider before buying life insurance.

Term Plans

₹1
Crore

Life Cover

@ Starting from ₹ 13/day⁺

₹50
LAKH

Life Cover

@ Starting from ₹ 8/day⁺

₹75
LAKH

Life Cover

@ Starting from ₹ 12/day⁺

What Are The 7 Factors To Consider Before Buying Life Insurance?

When purchasing life insurance, key factors to consider include your personal financial needs and goals, the required coverage amount and policy term, the affordability of premiums, and the reputation of the insurer.

Understand your life stage and financial responsibilities

Your age and current life stage greatly determine the type and amount of life insurance you should get. A young professional who has just started earning will have very different needs from someone married with children or nearing retirement.

Consider your dependents, debts, ongoing expenses, and future financial goals. This will help you identify how much protection your family might need if you are no longer around to support them.
Decide how much life cover you need

Choosing the right sum assured is one of the most important steps in buying life insurance. A good rule of thumb is to select a policy covering at least ten to fifteen times your annual income. To determine the precise coverage amount, you can use a Human Life Value Calculator to make an informed decision.

Look at your family's lifestyle, monthly expenses, liabilities such as home loans, and important future goals like your child's education or wedding. Ensure the life cover meets these needs without putting financial pressure on your loved ones.
Choose the right type of life insurance policy.

Not all life insurance plans are the same. Different policies serve different purposes. Here are a few common types to consider:
- Term life insurance is best if you want high coverage at affordable premiums. It provides a large death benefit but does not offer maturity returns.
- Endowment plans combine life cover with savings. They offer maturity benefits if you survive the policy term.
- Whole life insurance covers your entire lifetime, typically up to 99.
- ULIPs or Unit Linked Insurance Plans offer the dual benefits of insurance and investment.
- Child plans help secure your child's future financial needs, such as education or higher studies.
Pick a policy based on your financial goals, risk appetite, and protection needs.
Choose the Right Policy Tenure

Your life insurance coverage should ideally last until your key financial responsibilities are completed. This usually means till retirement or until your children become financially independent.

For example, if you are currently 30 years old and planning to retire at 60, a 30-year policy term would be suitable. Choosing a longer policy term can provide better peace of mind and continued protection for your loved ones.
Premium Payment Mode

Choose a payment mode that suits your budget: monthly, quarterly, half-yearly, annually, or a one-time lump sum. Some plans also offer limited pay options, where you pay for a few years but stay covered for the full term. Select what's most convenient and affordable for you.
Policy Terms and Conditions

It's important to carefully review the terms and conditions of your life insurance policy. Look into the grace period allowed for late premium payments, and check if there's any waiting period before certain benefits begin. Also, understand other key aspects like nomination rules, the option to take a loan against the policy, and the charges and value applicable on surrendering the policy early. These details can affect how the policy works during its tenure and at the time of claim.
Choose optional riders for added protection.

You can attach additional benefits to your base life insurance policy for extra protection. While they require a small additional premium, they can be extremely valuable in certain situations.

Some popular riders include:
- Accidental death benefit
- Critical illness rider
- Waiver of premium rider
- Permanent disability benefit
Choose the riders that match your specific health risks or lifestyle needs to customize your coverage.

What Are The Benefits Of Buying Life Insurance in India?

The benefits of buying life insurance are as follows:

Ensures Family's Financial Security: Provides a safety net for your loved ones in case of an unfortunate demise. You can buy the best term insurance plans from Policybazaar after comparing them to 15+ top Indian insurers.
Covers Critical Illnesses: Helps cover medical expenses during serious health conditions.
Affordable Long-Term Coverage: Offers substantial financial protection at reasonable premiums.
Wealth Creation for Future Goals: Helps in financial planning for your child’s education, home purchase, or business ventures.
Retirement Security: Ensures a steady income post-retirement through pension plans.
Tax Benefits: Avail deductions under Sections 80C and 10(10D) of the Income Tax Act, 1961.
Peace of Mind: Knowing that your family is financially secure in your absence brings peace of mind.

Wrapping It Up

Before choosing a life insurance plan, consider your financial responsibilities and current life stage to determine how much coverage you truly need and for how long. It also helps to check how trustworthy the insurer is by reviewing its claim payout track record. Go through the policy terms carefully, ensure the premium fits your budget, and explore add-ons such as critical illness or accidental death benefits that can enhance your overall protection.

People also search for

What is Term Life Insurance

FAQs

Q1. How do I determine the right life cover amount?

Ans: The ideal life cover depends on your financial responsibilities, number of dependents, current and future income, and existing assets. A general rule of thumb is to choose a cover that is at least 10-15 times your annual income. For example, if you earn ₹10 lakh per year, you should aim for a minimum life cover of ₹1 crore. You can also use a Human Life Value (HLV) Calculator to get a more accurate estimate.
Q2. What factors affect life insurance premium rates?

Ans: Several factors influence the premium of your life insurance policy, including:
Age: Younger individuals pay lower premiums.
Health Condition: Medical history and pre-existing conditions can affect rates.
Policy Type: Term plans are more affordable than investment-linked policies.
Smoking & Lifestyle Habits: Smokers and those with high-risk occupations may have higher premiums.
Policy Term & Sum Assured: Longer durations and higher cover amounts increase premiums.
Q3. What is the most important reason for having life insurance?

Ans: The most important reason for having life insurance is to provide financial security to your loved ones in your absence. It ensures they can cover daily expenses, repay debts, and maintain their standard of living.

Different types of Plans

Term Insurance

View Plans

Life Insurance

View Plans

List of Term Insurance Companies

View Plans

TROP

View Plans

Term Insurance For Senior Citizen

View Plans

Term Insurance For Spouse

View Plans

Term Insurance For Family

View Plans

Term Insurance For NRI

View Plans

List of Term Insurance Plan

View Plans

Life Insurance Corporation of India

View Plans

What is Term Insurance?

View Plans

Term Insurance Calculator

View Plans

1 Crore Term Insurance

View Plans

2 Crore Term Insurance

View Plans

Explore the popular searches and stay informed

˜The insurers/plans mentioned are arranged in order of highest to lowest Sum Assured(SA) offered by Policybazaar’s insurer partners offering term insurance plans on our platform, as per ‘first year premium of life insurers as at 31.03.2025 report’ published by IRDAI.

Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. For complete list of insurers in India refer to the IRDAI website www.irdai.gov.in

Rs. 400/month is starting price for a 1 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

Rs. 400/month (Rs.13/day) is starting price for a 1 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 230 is starting price for a 50 lakhs term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

+Rs. 8/day is starting price for a 50 lakhs term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

+Rs. 12/day is starting price for a 75 lakhs term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

+Rs. 497/month is starting price for a 1.5 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 487/month is starting price for a 2 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 626/month is starting price for a 3 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 905/month is starting price for a 5 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 1,267/month is starting price for a 7 crore term life insurance for an 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

*The full refund of premium is available on availing the one-time option of refund of premium. Total premium paid for policy (paid for add-ons) will be the special exit value, payable on availing the one-time option of refund of premium if you wish to completely exit the policy.

+Rs. 447/month is starting price for a 1 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs.679/month is starting price for a 2 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 910/month is starting price for a 3 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 1,374/month is starting price for a 5 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

+Rs. 1,924month is starting price for a 7 crore term life insurance for an (NRI) 18 year-old male, non-smoker, with no pre-existing diseases, cover upto 30 years of age.

Women

+Rs. 400/month is Starting price for a 1 crore term life insurance for an 18 year-old Female, non-smoker, with no pre-existing diseases, cover upto 30 years of age, rounded off to nearest 10.

Rs. 461/month is the starting price for a 1 crore term life insurance for an 24 year-old female, non-smoker, with no pre-existing diseases, cover upto 54 years of age.

1,642/month is the starting price for a 1 crore term life insurance for an 44 year-old female, non-smoker, with no pre-existing diseases, cover upto 74 years of age.

Prices offered by the insurer are as per the approved insurance plans | #All savings and online discounts are provided by insurers as per IRDAI approved insurance plans | Standard Terms and Conditions Apply | **Tax Benefits are subject to changes in tax laws.| Policybazaar Insurance Brokers Private Limited

We will respond in the first instance within 30 minutes of the customers contacting us. 30-minute claim support service is for the purpose of giving reasonable assistance to the policyholder in pursuance of the claim. Settlement of claim (including cashless claim) is the responsibility of the insurer as per policy terms and conditions. The 30-minute claim support is subject to our operations not being impacted by a system failure or force majeure event or for reasons beyond our control. For further details, 24x7 Claims Support Helpline can be reached out at 1800-258-5881

For more details on risk factors, terms and conditions, please read the sales brochure carefully before concluding a sale

Policybazaar Insurance Brokers Private Limited | CIN: U74999HR2014PTC053454 | Registered Office - Plot No.119, Sector - 44, Gurgaon, Haryana – 122001 | Registration No. 742, Valid till 09/06/2027, License category- Composite Broker Visitors are hereby informed that their information submitted on the website may be shared with insurers. Product information is authentic and solely based on the information received from the insurers.

˜ Policybazaar Promise reflects the guarantee offered by insurers. Price assurance is based on certifications shared by insurers with us.