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Term insurance is a life insurance plan offered by an insurance company that provides comprehensive financial coverage against premiums paid for a limited period to the beneficiary of the policy; this coverage, provided under term insurance plans, is paid as death benefit upon the demise of the insured during the policy term.
Term insurance is a life insurance policy that provides financial coverage to the beneficiary of the policy if the life insured dies during the active term of the policy. A term insurance plan provides life insurance cover against the fixed premium paid for specified "term" of the year.
A term plan not only offers financial security to your family but also is capable of fulfilling its future needs such as your child’s higher education, child’s marriage, etc.
Among all the life insurance products, Term life insurance offers the highest life coverage for the minimum premiums during the term of the policy. Some Insurance Companies also cover permanent or partial disability wherein the policyholder’s regular income is disrupted.
Note: In case of survival of the life insured the coverage at the earlier rate of premiums is not guaranteed after the expiry of the term insurance policy. The buyer has to either obtain extended coverage with different payment conditions or forgo the coverage entirely.
There are various reasons to buy a term plan. However, here are the key and basic reasons that you must buy term insurance:
|Insurers||Term Plan||Claim Settlement Ratio||Max Maturity Age||Premium (for a cover of 1 crore)|
|Aditya Birla Sun Life Insurance||ABSLI LifeShield Plan||97.1%||75 years||Rs. 623/month|
|Aegon Life Insurance||iTerm||96.5%||100 years||Rs. 479/month|
|Bajaj Allianz General Insurance||Life Cover||95%||85 years||Rs. 458/month|
|Canara HSBC OBC Life Insurance||iSelect+ LumpSum||95.2%||99 years||Rs. 480/month|
|EXIDE Life Insurance||Exide Life Smart||97%||55 years||Rs. 926/month|
|Edelweiss Tokio Life Insurance||Zindagi Plus+ Lump sum||97.8%||80 years||Rs. 478/month|
|Future Generali India Insurance||Future Generali Flexi Online Term-Lumpsum||95.2%||75 years||Rs. 486/month|
|HDFC Life Insurance||Life Option||99%||85 years||Rs. 709/month|
|ICICI Prudential Life Insurance||iProtect Smart Lumpsum||98.6%||85 years||Rs. 647/month|
|IndiaFirst Life Insurance||e-Term Plan||94.2%||65 years||Rs. 422/month|
|Kotak Life Insurance||e-Term||97.4%||75 years||Rs. 654/month|
|Max Life Insurance||Smart Term Plan Life Cover||99.22%||85 years||Rs. 571/month|
|PNB Metlife Life Insurance||Mera Term Plan-Full Lumpsum payout||97.16%||99 years||Rs. 585/month|
|Reliance Nippon Life Insurance||Reliance Digi-Term||97.71%||65 years||Rs. 500/month|
|SBI Life Insurance||eShield||95.03%||80 years||Rs. 589/month|
|Tata AIA Life Insurance||TATA Maha Raksha Supreme Lumpsum||99.1%||85 years||Rs. 927/month|
Disclaimer: “Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.”
Term insurance offers flexible plan options to suit the needs of every individual. You can choose:
A term insurance policy is a must for every person and one cannot articulate its importance completely. Term insurance plans are the only life insurance products that are especially designed to solve a sole purpose of protection. Now that everyone knows, it covers death perils and risks; here are some other core benefits of term insurance Plan in India:
A term insurance also aids in providing safety for the dependents from your fiscal liabilities such as loans or any other debts that you have.
Together with offering life cover, a term insurance plan also offers protection against critical illness. For a tiny add-on premium amount, Critical Illness cover offers lump sum payment when any critical illness such as kidney failure, cancer, or heart attack, etc. is first detected. Online Term Insurance Plan also takes care of family in case of your disability or critical illness. It provides
One of the most alluring features of term insurance Plan is that the premiums are always the lowest, unlike the other life insurance products. Moreover, the sum assured offered under term Plan is relatively higher when compared to the premium amounts. Regular term insurance Plan, including TROP Plan come with a 105% return on premium benefit when the policy matures.
Term insurance plan comes loaded with tax benefits on the term policy premiums paid. New-age term insurance Plan along with critical illness cover also provide some additional tax benefits on the premiums paid by the policyholder. One can also avail benefits subject to the conditions u/s 10(10D) on the amount that his/her family receives in the case of an untimely demise or unfortunate event.
In some of the term Plan, the insurance provider pays the future premiums in the case of permanent or total disability. Consequently, the policyholder’s life insurance cover continues even if s/he is not able to make payment of the premiums.
So as to amplify the security of the family, a term insurance plan offers add-on pay-out in the case of an accidental or untimely demise.
On the demise of the life assured during the tenure of the policy, the nominee/ beneficiary of the policy receives the total death benefit chosen at the time of commencement. Depending on the type of term insurance plan, the death benefit may stay the same over the whole tenure of the plan (standard term Plan), decrease (decreasing term Plan) or increase (increasing term Plan). The insurers provide various options of payment for the term insurance plan. These include a lump sum payment, lump-sum payment plus an annuity that may be monthly, quarterly or yearly, or simply annuities that are spread over the agreed number of years.
Term insurance plans don't come with any survival or maturity benefits. If one wants maturity benefits, then a TROP (Term Return of Premium) plan is suggested.
A standard term plan does not have any survival benefits. However, the demand from investors has meant that various companies have opted to launch term insurance plans with survival benefits. Called Term Return of Premium (TROP) Plan, the term plan refunds the premium at the end of the term plan tenure if the insured person survives the period. The TROP plan is becoming popular with people who are looking for savings as well as insurance with their term plan.his term insurance plan has a higher premium than the standard term plan but has the advantage of assurance that the policyholder will get back the premium he or she paid to the life insurance company for the cover. Policy holders should read the insurance terms and conditions carefully to ensure they know the amount of money they will get back as survival benefits. Check out the term insurance policy that meets your needs with our term insurance comparison.
Term Insurance plans are specifically designed to secure your family's basic financial needs in case of death or uncertainty. According to the plan, family/dependents of the life insured is/are eligible for a lump sum amount in case of death or critical illness (if applied for) of the life insured during the tenure of the policy.
Let’s take a look at the salient features of the term insurance Plan.
Buying a term insurance plan is extremely cost-effective and does not create a hole in the pocket of the individual. A term plan provides instant insurance solutions, which can easily be availed by making premium payments. The term life insurance premiums are low when compared to any other life insurance products.
Buying a term insurance policy is no more a tedious task rather one can easily buy an online term plan on the premise of their requirements. Before one zero down a term insurance policy, it is recommended that conduct thorough research in regards to the same and only then make an informed decision of buying an online term insurance policy.
Choosing the right term life insurance plan for a long-term perspective will protect your family from any financial liabilities. One has the option to choose a term life cover for up to 50 years of age.
One can easily make the payment towards term plan premium on a monthly, quarterly or yearly basis on the premise of their convenience.
One has the option to enhance the term insurance plan by opting for riders or any other variants for instance including the return of premium.
Additional optional benefits such as critical illness and accidental death/ disability or Accelerated Sum Assured are also available under the term insurance policy. The benefits can be added to the term plan by paying an additional premium amount. The best term plan in India is the one that offers these riders at a comparatively lower price than opting for such cover through individual Plan. Choose the additional optional benefits for your term insurance plan with our website. Use the term plan comparison features to shortlist the additional benefits you need.
Some common term insurance riders are:
With buying the best term insurance plan one has the liberty to either increase or maybe decrease the sum assured subject to the financial changes in one’s life.
A disability is mostly caused because of an unfortunate accident or sometimes even because of the illness. In case the earning member of the family faces any sort of disability it directly affects the income earning capacity of the family. Therefore, when buying a term insurance plan, it is advisable to include a disability benefit and make the term plan even more secured at an affordable additional premium price.
The mere thought of life-threatening disease scares anyone. In case, somebody from a family is diagnosed with a life-threatening disease it could be a matter of great concern both mentally and financially. When buying a term insurance plan, choose a critical illness cover and secure the family from any financial stress that may occur.
Term insurance plan comes with excellent tax benefits. You can avail lucrative tax benefits within Section 80C and Section 10 (10D) of the Income Tax Act, 1961. Moreover, the term life insurance premiums paid for the Critical Illness Benefit towards term plan, also qualify for a deduction within Section 80D.
Note: Tax benefits are subject to changes in tax laws. Please consult your tax advisor for details.
There are a number of term insurance plans available in the market from various insurance companies in India. All of these companies offer both types of online and offline term life insurance with each term policy having its own set of specific features that make it the best term insurance plan in the market. To understand these term plans we need to look at them a bit more in depth.
The level term plan is one of the easiest types of term insurance plan wherein during the policy tenure the sum assured remains unchanged and the benefits are paid to the beneficiary on the demise of the policyholder. The level term insurance plan is easily available PAN India and is offered by various insurance companies. The rule is simple the younger you are when buying this type of term insurance plan the premiums will be that pocket-friendly.
A standard term insurance plan is one where the insured person gets a cover against various risks against payment of a certain term life insurance premium amount. The most common term plan and generally also considered the best term insurance policy is the one that charges a yearly premium for an annual cover.
A term insurance return of premium policy is a term insurance plan that refunds the premium paid for the cover in case the insured party survives the policy period. These term plans are increasingly becoming popular as the policyholder gets the money they have invested in the term insurance policy at the end of the policy period.
These term insurance policies also give the insured the option to add on riders that they feel are essential. These riders add to the premium of such a term plan just like any other standard term insurance policy.
Group term insurance are term insurance plans that are specially designed for businesses, companies, societies, associations or large families and provide term plan insurance cover for all the members of the group. These policies provide the same set of benefits that an individual term plan offers but the overall coverage is generally more in terms of illnesses or other factors that are generally excluded in the individual policies. Most of these term plans are offline as each policy is generally customized to suit the needs of the group taking the policy.
The cover and the term life insurance premium increase over the overall tenure of the renewable term insurance plan. This term plan helps to cover against risk from rising inflation costs that may affect the real value of the death benefits that the insured individual's family would receive. The cover under these term insurance plans rises at a pre-specified rate and keeps increasing until the overall value of the cover is 1.5 times the original cover under the term policy.
The decreasing term insurance plan is a renewable term plan where the sum assured of the policy decreases every year by a fixed percentage over the tenure of the policy. These policies are generally offered as mortgage clearing plans. Decreasing term plan is taken to clear debts and loans. In case of demise of the insured person, the available sum assured amount is paid towards the repayment of the loan. The premium rate of decreasing term plans is less as compared to the normal term Plan. This term insurance policy provides financial security to the insured’s family and offers the benefit of tax exemption at an affordable premium rate.
This type of term insurance plan is generally offered by some insurance companies in India. As the name suggests the key highlight of taking a term plan is that when buying this term insurance plan you can opt the alternative to convert the plan into some other plan in the coming times and accordingly select a date. For instance, if you had taken a term insurance plan let’s just assume for 25 years, however, after 5 years, you intend to convert this into any other plan like an endowment plan or any other plan, you can go ahead.
A joint term insurance plan works out to be cheaper than buying two individual term insurance plans. Moreover, the features and benefits remain the same, ensuring both the members get the same advantages of the plan.
These policies are ideal for a couple with children as it will ensure the dependents will not have to worry about their future if the unfortunate comes to pass and both parents pass away. A joint term insurance policy is the best option to go with as it also provides insurance cover for the surviving spouse.
Offline term Plan are those that are sold through traditional methods such as through an agent or a branch, while online term Plan refer to term insurance Plan that are sold over the internet. Term insurance providers offer an online term plan at a significantly discounted rate than the offline plan. The primary reason for this is the lack of any intermediaries such as the agent or the branch between the policyholder and the insurance company for an online term insurance plan.
People could now buy online life insurance at the click of a mouse in a few minutes.Research shows that an online term insurance plan may be cheaper by as much as 40% in some cases than the offline plan that offers the same features and benefits. There are various reasons for the low premium in an online term insurance policy. For instance:
No commission to be given to agents in online term life insurance. Well-informed decision, since the online term plan space gives a lot of scope to compare the choices. There are quite a few online life insurance plans that may suit your requirements. A smart way to look at online life insurance plans is to compare term insurance plans side by side and pick the term plan that makes sense. Choose your online term insurance plan using our term plan comparison options.
Your hunt for the best online term insurance Plan ends at PolicyBazaar. We go extra miles to serve you with the best term insurance quotes that suit your budget and requirements. Just provide us with the minimum basic details such as name, age, income and here you go. We not only suggest the quotes but also calculate the premiums for you. On the basis of our suggestions, all you need to do is to compare term insurance plans and opt for the best deal. Do you compare on the basis of certain parameters like premium offered, claim settlement ratio of the insurer, tenure, coverage etc. This way we help you make an informed decision while suggesting the best available options in a hassle-free manner.
can always be a daunting task for insurance buyers. Different insurance providers offer a different type of term insurance plan and each plan varies from another based on various factors. Thus, in order to choose the best plan as per one’s own requirement and suitability, it is very important to compare term insurance plans online before zeroing in on one.
While comparing term insurance plans, it is very important to check the various aspects of policy such as Insurance Coverage, Maturity Age, Claim Settlement Ratio etc. By comparing the quotes of various term insurance plans, the policy buyers can choose the plan which fulfils their requirement at an affordable premium rate.
For the better understanding of our readers, here we have shown the term plan comparison chart.
|Plans||Entry Age||Policy Term||Premium Paying Term||
|Incurred Claim ratio|
|Aviva Life Shield Advantage Plan||18 years/55 years||10 years-30 years||Single pay, Regular pay||Min-Rs.35,00,000 Max-Option A- No upper limit Option B- Rs.50,00,000||96.06%|
|Bajaj Allianz iSecure Plan||18 years/60 years||10,15, 20,25 & 30 years||Regular pay||Min- Rs.2,50,000(general category)Rs.20,00,000 (split category) Max- No upper limit||95.01%|
|Bharti Axa Life Flexi Term Plan||18 years/65 years||5, 10,15,20 years||Regular pay||Min- Rs.10,00,000 Max-Rs.25,00,000||97.28%|
|Canara HSBC iSelect Term Plan||18 years/65,55, 50, 45 years||N/A||Single pay, limited pay||Min-Option 1- Rs.25,00,00 Option 2- Rs.50,00,000 Option 3- Rs.15,00,000 Max- No upper limit||94.04%|
|Edelweiss Tokio Life Protection Plan||18 years/60 years||10-30 years||Single pay, regular pay||Min- Rs.15,00,000 Max- No upper limit||95.82%|
|Exide Life Smart Term Plan||18 years/60 years, 65 years||10-30 years, 12-30 years||Regular Pay||N/A||97.03%|
|Future Generali Flexi Online Term Plan||18 years/55 years||10 years- 65 years minus entry age(smokers) 10 years-75 years minus entry age (non-smokers)||Equal to policy term||Min- Rs.50,00,000 Max- No upper limit||95.16%|
|HDFC Life Click 2Protect Plus||18 years/65 years||5 years-85 years minus the age at entry 10 years-40 years||Regular pay, limited pay & single pay||N/A||99.04%|
|ICICI Pru iProtect Smart Plan||18 years/65 years||5,10,15,20 years||Single pay, limited pay, regular pay||N/A||98.58%|
|IDBI Federal Termsurance Life Protection Plan||18 years/60 years||10-30 years||Single Pay, regular Pay||Min-Rs.5,00,000 Max- No upper limit||95.79%|
|Kotak e-Term Plan||18 years/65 years||5 years-40 years||Regular pay, limited pay, single pay||Min-Rs.25,00,000 Max- No upper limit||97.40%|
|LIC Tech Term Plan||18 years/65 years||10 years-40 years||Equal to policy term||Min-Rs.25,00,000 Max- No upper limit||97.79%|
|Max Life Smart Term Plan||18 years/60 years||Regular Pay- 10 years-50 years Limited Pay- 15 years-50 years||Regular pay, limited pay||Min-Regular Pay- Rs.25,00,000 Limited Pay- Rs.25,00,000 Max- Rs.100 crore||99.22%|
|PNB Metlife Mera Term Plan||18 years/65 years||10 years-81 years||Regular Pay & limited pay||N/A||96.21%|
|Pramerica Life TruShield||18 years/45,50,55 years||7 years, 10 years, 12 years, 15 years &20 years||Regular pay, limited pay||Min-Rs.5,00,000 Max-Rs.50 Crore||96.80%|
|SBI Life eShield Plan||18 years/60 years, 65 years||5 years- 80 years minus the age at entry 10 years-75 years minus the age at entry||Equal to Policy Term||Min-Rs.35,00,000 Max-No upper limit||
|Shriram Life Smart Protection Plan||18 years/65 years||10 years-30 years||Equal to policy term||Minimum- Rs,1,00,000 Maximum-Rs.14,00,000||85.03%|
|Star Union Dai-ichi Life Abhay||18 years/65 years||15 years-40 years||Single pay, regular pay||Min-Rs.50,00,000 Max-Rs. 100crore||96.74%|
|TATA AIA Sampoorna Raksha||18 years/70,65,50 years||10years-85 years minus age at entry, 15 years-85 years minus age at entry For Whole Life- 100 years minus age at entry||Limited Pay, Regular Pay||Min-Rs.50,00,000 Max- No upper limit||99.07%|
Disclaimer- “Policybazaar does not endorse, rate and recommend any particular insurer or insurance product offered by an insurer.
The ideal time to buy the online term plan is as early as possible. The early one buys the better it will be. Buying the right term plan ensures that you obtain the desired life coverage. Moreover, buying term life insurance policy at an early stage of life means that the insurance premiums will be low compared to the times if bought at a later stage of life.
The moment one realizes that they have dependent on their life, they should immediately look for a plan and buy the best term insurance policy. In case one has missed investing in the term plan at an early stage of life, do not neglect it further by buying the best online term insurance now. It is better to be safe than sorry.
Listed below are some of the major factors that affect term insurance premium:
To select the best term insurance plan, a policyholder should look into the following factors:
The record of term insurance claim settlement provides a clear picture of the insurance provider to the prospect policy buyers. The ratio of claim settlement is released by the Insurance Regulatory and Development Authority (IRDA) India every year. A claim settlement ratio that is consistently good indicates that the insurance provider has been quick and robust in its claim settlement process.
A critical medical issue such as brain surgery or cancer costs a lot of money and cripples the finances of the family. However, if a term plan chosen by a policyholder covers critical illness or if it has the feature to add-on critical illness cover in it, then one can easily safeguard self from such risks. Most of the critical illness add-ons immediately payout upon diagnosis of the critical illness.
The reputation of a company and stability is very important in any sector of business, especially in the sector of life insurance for the customers to trust. Before zeroing in on a plan, it is important to check the credibility of the insurance company.
The premium rate of a term insurance plan plays a vital role while purchasing the plan. Hence it is important to compare term insurance policies online and choose the term plan which offers higher coverage at an affordable premium rate. Additionally, choose a company that provides discounted premiums to non-smokers.
If the policyholder gets affected by some terminal illness, then all the future premiums for his/her term policy will be waived off.
The solvency ratio is something that tells whether the insurance provider chosen will be capable financially for settling the claims if the requirement arises. As per IRDA, every life insurance provider should maintain a solvency ratio of 1.5 at least.
Some of the specific insurance companies offer the option of enhanced cover in the term insurance policy. In this option, the policyholders can enhance the coverage of the policy under particular circumstances or critical situations.
While purchasing a term plan, it is important to check the rider benefits offered by the term insurance company in a detailed way. An insurance rider is extra to the essential plan that offers advantages far beyond the subject of the policy in case of any eventuality.
Since their inception, life insurance plans like term insurance plans have provided a large sum of money to the nominee of the policyholder. However, some modern term insurance policies are providing the option of regular payout along with some lump-sum. So, opt for a policy that provides a regular payout option.
The term insurance calculator is an online tool designed specifically so that one can calculate the premium that needs to be paid monthly and accordingly know the sum assured amount. The term insurance plan calculator is simple and easy to use. When intending to buy a term insurance plan, it is advisable to use a term insurance premium calculator.
The term insurance premium calculator permits you to modify the sum as per your convenience that you think your family would require in case of your demise. Listed below are some major advantages of using a term insurance premium calculator:
Apart from the hassle-free and simple process of purchase, an online term plan offers many other benefits.
Purchasing an online term insurance plan is more affordable as compared to purchasing the plan offline. This is because there are no agents involved in between. The policy buyers can directly purchase the online term plan by visiting the website of the insurance company. By purchasing the plan online, the paperwork and processing fees automatically decrease as everything is done online and these benefits are offered to the customers as discounts. Thus, buying an online term plan is more beneficial as compared to the offline term insurance policy.
This is yet another benefit of buying an online term insurance plan. Mostly, the sum assured amount offered by an online term plan tends to be higher in contrary to offline term insurance plans, because the overall cost of purchase is low. Moreover, while purchasing the term plan online, most of the insurance companies do not ask for any medical test. Medical test of the insurance buyer is only required in case the sum assured amount of the policy is above Rs.50 lakhs.
One of the perks of buying an online term insurance plan is that it offers the advantage to compare term insurance policies online and then choose a particular plan as per one’s own requirement and suitability. By comparing term insurance plans online, the insurance buyers can zero in on the most beneficial plan at the most affordable premium rates.
The online process of policy purchase is more reliable. The online term insurance policy offers transparency while purchasing a policy. The policy buyers can know about the features, terms and conditions of the policy in a more detailed way by simply visiting the website of the insurance company. Moreover, in order to make an informed decision, the insured can also check the reviews of the plan.
Unlike offline term insurance policy, the online term insurance plan can be accessed easily. The insurance holder has the convenience to access and know the policy details whenever they require. Moreover, they can also check and keep track of the policy status from time to time.
Any individual with financial dependents should consider purchasing an online term insurance policy. This includes young professionals, parents, married couples and people who want to gain tax benefit as term insurance plan provides tax benefit under section 80C of Income Tax Act 1961. Hence, any individual who wants to provide life protection to their family at an affordable premium rate along with the benefit of tax exemption should purchase a term insurance policy.
As the simplest form of life insurance product, term insurance is the most affordable insurance plan which offers higher insurance coverage. As the purest insurance product, only death benefit is offered by the term plan. Under the online term insurance plan, the insurance company gets into an agreement with the insurance buyers.
According to this agreement, a lump-sum, sum assured amount is paid to the beneficiary of the term insurance policy as a death benefit in case of the unfortunate demise of the policyholder during the policy tenure. The insurer pays the sum assured amount to the beneficiary as mentioned in the term insurance policy documents.
The sum assured amount is paid on the basis of the type of payout option chosen by the insured at the time of policy purchase. The payouts can be made as a lump-sum payment at one go or as monthly income at specific intervals of time.
The entire sum assured amount is paid at one go to the beneficiary of the term insurance policy.
Sum assured= 1 crore
Payout= Rs.1 crore as a lump-sum payment to the beneficiary of the term insurance policy.
2. Lump-sum + Monthly Income
Half of the sum assured amount is paid as a lump-sum payment to the beneficiary of the term insurance policy, whereas, the other half of the sum assured amount is paid as monthly income to the beneficiary of the policy.
Sum assured= Rs.1crore
Payout= Rs.50 lakh as a lump-sum payment at the time the claim is made by the nominee and Rs.50,000 every month as a death benefit.
3. Income Replacement or Monthly Income
A fixed percentage of sum assured amount is paid as monthly income from the first month of life insured’s death.
Sum assured= Rs.1 Crore
Payout= Rs. 1 lakh per month (Rs. 12 lakh yearly) for 83 months approximately.
A term plan from Policybazaar helps you in the following way:
The Plan offers the benefit of tax saving under section 80C of the Income Tax Act. The plans are available for the long policy term. Offers long term coverage. It protects from critical illness when diagnosed. Offers a regular income for meeting the household needs. Offers disability benefit riders to be added to the term plan. Provides coverage against life-threatening illness. The Plan provides a high maturity age.
The steps to process a claim for a term insurance plan is mentioned below:
A claim is formally registered and accepted only after receiving a written request for claim settlement with a duly signed and filled claim settlement form with other relevant documents. An individual should file a term claim via phone call or by visiting the nearest branch of the insurance company for the quick claim process.
The process of claim settlement starts when the nominee of the policyholder submits a duly filled and signed claim form with all the supportive and valid claim documents. The list of all the required documents is given below:
As soon as the insurance provider verifies all the required documents and then accepts the claim, the payouts will be made according to the payment options present in the term plan. The payouts are usually given via ECS, for which the nominee should submit the details of the bank, photocopy of the passbook of the bank account, and canceled cheque. Some insurance providers may need these details attested by the concerned bank, so do check the same.
Before purchasing any term plan, it is very important for policy buyers to go through the terms and conditions of the policy and check all the exclusions mentioned in the policy documents. However, term insurance Plan come with only one exclusion i.e.
Suicide Exclusion: In case, the life insured (sane or insane) commits suicide within 12 months (1 years) from the date of policy inception or from date of revival of policy, the policy terminates immediately. In such cases, the beneficiary of the term insurance policy receives only the total term life insurance premium amount paid by the insured from the insurance company (inclusive of extra premium, if any, but exclusive of applicable charges and taxes imposed by the government).
Apart from the above, there are other exclusions as well, which come under critical illness riders. If any of these exclusions are found at the underwriting stage of the term insurance policy, then no benefit will be offered. Let’s take a look at the exclusions, which come under critical illness riders.
Riders are the add-on coverage which can be purchased by the policyholder along with the basic term Plan in order to enhance the coverage of the policy. There are various online term insurance plans which offer riders as an in-built feature of the policy. Before zeroing in on an online term plan it is very important to check what are the in-built riders and add-on riders offered under term insurance policy. The rider benefit can be availed by paying an extra premium to the insurer along with the basic premium of the term policy. Some of the riders offered by the term Plan are:
With this term insurance rider benefit, the insurance holder receives a lump-sum amount in case of valid diagnosis of any critical illnesses as pre-specified in the policy. The illnesses which are covered under critical illness cover are heart attack, cancer, paralysis, stroke, kidney failure, coronary artery bypass surgery, major organ transplant, etc.
This is one of the most beneficial rider benefits offered under term insurance policy. Under this rider benefit, in case the life insured fails to pay the future premium of the term policy due to a disability or income loss, then all the future premiums of the term plan are waived off and the policy continues to remain active.
Accidental death benefit riders can be bought in order to enhance the coverage of the term insurance policy. Under this rider benefit, an extra sum assured amount is paid to the beneficiary of the policy along with the basic sum assured amount in case of accidental demise of the insured person. This rider benefit works as a saviour by offering an add-on payment to the family at the time of financial hardship.
This is an add-on rider benefit offered by the term insurance wherein, an extra sum assured amount is paid to the policyholder in case; he/she suffers from an accidental permanent or partial disability which leads to unemployment. Generally, the insurance companies offer 10% or more sum assured amount per year in order to compensate for the regular income that may happen due to total and permanent disability of the policyholder.
This rider offered by term plan is specifically designed to generate income after the demise of the life insured. Under this rider benefit, the insured’s family receives additional income every year for the tenure of 5-10 years, along with the regular sum assured amount.
There are various factors which determine how much term insurance coverage one should take. For the convenience of the insurance buyers, here we have discussed some of the factors.
The best thing about the online term plan is the freedom of the policyholder to select the most suitable policy. In addition to this, the online term insurance plan as well brings some additional responsibility on the insured of staying focused and informed for the features of the product. It is only when one matches his/her requirements with the term plan; he/she is eligible to purchase it. Mentioned below are three steps for making the right choice while buying a term policy:
The first step that every term life insurance buyer should consider while purchasing it to find out the amount of coverage as per the requirements of his/her family’s future needs. To find out the same, there are many term insurance calculators available online. One can use one of these calculators and find out how much he/she should invest per month so that the future requirements of his/her family are met when he/she is not around.
If one wants to calculate it manually, then he/she can do the same by following the thumb rule of the term policy calculation. According to this rule, the life or term insurance coverage should be 15 times the annual salary of the policyholder. So, if Mr. A’s annual income is Rs.12 Lakh, then he requires a term insurance of Rs.1.8 Crore. However, the second step is also added in this, wherein one should also find out the required coverage from term life insurance for covering his/her other financial obligations like the higher education of policyholder’s children and other outstanding loans. For example, the sum of these financial obligations on Mr. A is Rs.50Lakh, and then the total coverage from the life or term insurance that he wants is Rs.2.3 Crore.
Term insurance plans are the purest form of life insurance. Term insurance premiums are lower than other life insurance plans. However, in order to ensure the right plan, one should go for term insurance comparison. Compare term insurance with other insurance plans online and stay covered.
A term insurance aspirant as well is suggested to compare term insurance Plan through online term insurance comparison websites. One should compare different term insurance plans on various features such as duration of the term, maximum coverage provided, etc. It is also suggested to search for the background of the term insurance provider like the claim settlement ratio of the company, the company’s existence in the insurance industry, etc.
Term Plan as well allows purchasing riders for widening the risk coverage for the family of the policyholder. For example, to provide coverage against critical illnesses or accidents, there are riders provided by most of the term insurance providers. One can check for an appropriate rider on an online term insurance provider’s website. The riders are available at an additional cost, but most of the insurers make these available at affordable premiums. Therefore, it is worth attaching a suitable rider in the term insurance plan. In this way, the policyholder will have better risk coverage and he/she can give better protection to his/her family.
Purchasing an online term plan provides its policyholder with a lot of coverage. However, it is the responsibility of the insured to select the most affordable and suitable term insurance plan without missing out on any required detail. This is because a term plan secures the future of the family of the insured.
Investing in a term insurance plan, which should be included by everyone in their investment portfolio and secure the future of their dependents. In any case, if you are the bread earner or you have a family to take care of then it is prudent that you buy the best term insurance plan and provide stability and security to the family. Likewise, the government of India also offers different term insurance schemes for its citizens to safeguard the future of the dependents of the policyholder.
The Pradhan Mantri Jeevan Jyoti Bima Yojana is accessible for anyone who is aged between 18 years till 50 years and has a bank account giving their permission either to auto-debit or join. Aadhaar will be the essential KYC for the account holder. The life cover of Rs. 2 lakh will be for the one year extending from June 1st to May 31st and can be renewed. The risk cover under this plan is for Rs 2 Lakh if there should be an occurrence of the death of the policyholder. The term insurance premium is Rs 330 for each annum, which is to be auto-charged in one portion from the bank account of the subscriber according to the alternative given by him at the latest 31st May of every yearly inclusion period under the plan. The Life Insurance Corporation and other life insurance providers who are offering it on comparable standing with essential assent and other link-ups with banks are for this reason.
The Pradhan Mantri Suraksha Bima Yojana is accessible for people who fall between the age of 18 years to 70 years with an account in the bank giving their agreement upon the auto-debit or join at the May 31st for the period of coverage frame June 1st to May 31st on the premise of yearly renewal. Aadhaar to be the essential KYC for the account in the bank. The cover for risk within the plan is for an amount of 2 lakh unplanned demise and full inability and Rs 1 lakh for halfway handicap. The term insurance premium of Rs 12 for each annum is to be deducted from the account holder of the bank through the 'auto-charge' office in one portion.
The Aam Aadmi Bima Yojana came into existence in the year 2007. It essentially provides financial aid to those people who fall within the low-income category in India. This plan is specifically designed for those individuals who are not on a regular payroll such as auto-drivers, fishermen, etc. This scheme can be availed by anyone aged between 18 years to 59 years. At the initiation of this scheme an amount of Rs 200 is charged as the term insurance premium amount, however, half of the premium amount will be subsidized from the Social Security Fund. In the case wherein the policyholder passes away, as the death benefit the beneficiary will receive an amount of Rs 30,000.
Term insurance is the simplest form of life insurance product, which financially safeguards the future of the family and takes care of the liabilities in case of an eventuality. Read More
of the policy receives the total death benefit chosen at the time of commencement. Depending on the type of term insurance plan, the death benefit may stay the same over the whole tenure of the plan (standard term Plan), decrease (decreasing term Plan) or increase (increasing term Plan). The insurers provide various options of payment for the term insurance plan. These include a lump sum payment, lump-sum payment plus an annuity that may be monthly, quarterly or yearly, or simply annuities that are spread over the agreed number of years.
Term insurance riders are add-on benefits offered under the policy, in order to enhance the coverage of the policy. Policyholders can add riders to the plan by paying an extra premium along with the basic premium of the policy. Read More
The claim settlement ratio of an insurance company is the number of claims settled in a year against the number of claims filed. The higher the claim settlement ratio of the company, the more reliable the insurance company is. While purchasing a term insurance plan, it is very important to check the claim settlement ratio of the company. Read More
It is a pure term insurance plan, wherein only death benefit is paid to the beneficiary of the policy in case of the unfortunate demise of the insured person during the tenure of the plan. Read More
The term insurance premium is a specific amount paid by the policyholder to the insurance company in yearly, half-yearly, quarterly or monthly mode. The premium paid by the policyholder determines the term insurance coverage of the policy. The term policy is known to provide higher insurance coverage at an affordable premium rate. Read More
However, if the premium is not paid within the grace period, your policy is considered lapsed. Insurance companies offer different ways to revive lapsed policies. Some of them are mentioned below- By paying all the arrears of the term along with interest, you can revive your term plan.
In some situation, the company offers instalment revival process. It means you can pay arrears and interest in instalment along with regular premium. The balance revival amount is paid in instalments spread over a year.
You can revive your money back policy by using survival benefits (amount received from the insurance company at regular intervals) to pay the premium and extra charges. If the survival benefit is lower than the revival value, you have to pay the shortfall. If it is higher, you receive excess funds from the company.
Mandatory documents: In case of death claims the mandatory documents include Original Policy bond
Copy of death certificate and self-attested by the nominee.
Copy of photo identity proof
Copy of residential proof
Copy of bank passbook of the nominee along with the cancelled cheque.
Additional documents: In case the policyholder is murdered or killed in an accident, the following documents are required along with the mandatory ones:
Copy of FIR
Copy of Post Mortem report In case of non-accidental death of the policyholder,
The following documents are required along with the mandatory ones:
1.Copy of medical and legal cause of death
2.Copy of medical reports
3.The certificate issued by the attending physician
4.certificate issued by a family doctor (optional)
Lapsed policy: Once your policy has lapsed there is no chance that your claim will be paid any more.
Avoiding Compulsory medical tests: Some insurance plan asks for some mandatory medical tests. If you avoid those tests your claim may get rejected.
Mandatory exclusion: Some policies are preconditioned to exclude some particular events or loss. If you ask for coverage on such events your claim may get rejected.
Inadequate or untrue information: If you have not provided some important information (e.g. some pre-existing condition) in the proposal form, your claim may get rejected. Similarly, if you have provided some false information, your claim will be rejected.
Pure protection term plans offered by the prominent insurance providers like ICICI Prudent Life, HDFC Life, Tata AIA and Max Life observed a hike in the premium rates from 20%-35% in April 2020. The insurance companies that already have revised their premium by a certain percentage will further increase the premium rate by the remaining values. Also, the insurance providers who have not yet increased the prices of the term insurance will increase it in the coming months.
To determine the premium rate of term insurance policy by the reinsurers, it has been assumed that for every 10,000 lives covered by the term plan, only 3 deaths occur in each policy year. While the expected death number is 3 the actual death issued in the policy year per 10,000 policies is between 4-4.5. Moreover, the claim amount offered under a term plan is massive with an average policy sum assured is around Rs.1 crore. In India, the actual Vs expected ratio is more than expected, which leads to a negative experience in mortality. Thus, as demanded by the reinsurers, to improve this situation the term insurance premium will be revised by 40%.
As far as the life insurance industry is concerned, it normally includes insurance products like pure term insurance policies, savings policies, and investment-linked policies. As per the recent report by PWC India, all these categories of life insurance will be impacted on a broad, however, the reasons will be different for each category.
With the impact of Covid-19, there is an urgency to increase coverage of the term insurance policy. As a result of this, insurance companies are experiencing a boost in demand. However, with people’s cash positioning being unstable, they may be reluctant to take higher coverage. Also, if the buyers will choose higher insurance coverage then they will have to undergo medical tests, which people these days are reluctant to do. Thus, a temporary fall in sales activity is anticipated.