Prices Increasing soon Prices Increasing Soon

Term Insurance Advantages and Disadvantages in India

Term insurance is one of the simplest and most affordable types of life insurance that secures the financial future of your loved ones in your absence. But, when it comes to protecting your family financially, the main question that arises is, ‘Would buying a term insurance plan be beneficial’? What are the disadvantages of term insurance or the risks involved with the plan? Therefore, let us understand some of the term insurance advantages and disadvantages.

Read more
Gets ₹1 Cr. Life Cover at just
COVID-19 Covered
The Policybazaar Advantage
Dedicated claim support for family FREE
Upto 10% discount for buying online
Only certified experts will call you on 100% recorded lines
We are rated~
6.7 Crore
Registered Consumers
Insurance Partners
3.4 Crore
Policies Sold

#All savings and online discounts are provided by insurers as per IRDAI approved insurance plans | Standard Terms and Conditions Apply

By clicking on "View plans" you agree to our Privacy Policy and Terms of use

~Source - Google Review Rating available on:-

Life is Unpredictable! Protect your family’s future
Get ₹1 Crore Life cover starting from ₹384/month+
We don’t spam
Check Your Premium Now
Please wait. We Are Processing..
Get Updates on WhatsApp
The Policybazaar Advantage
Policybazaar Advantage Icon
Dedicated claim support for family FREE
Policybazaar team will help and support you at the time of claim. A personal claim handler from our team of experts will get in touch with you when your nominee applies for a claim on our website.
Policybazaar Advantage Icon
100% calls recorded to ensure no mis-selling
We will make sure you get what is promised by the advisors. We conduct regular monitoring of our calls to make sure you get the best experience.
Policybazaar Advantage Icon
Exclusive lifetime discount upto 5% for buying online
The discounts will be valid for the entire policy payment term and is not available if you choose to buy the insurance through offline agents.
Policybazaar Advantage Icon
Advisors available in your city
Our advisors are available in more than 55 cities across India and can help you at your doorstep in understanding the plans and in documentation.
Policybazaar Advantage Icon
Refund at the click of a button
In case you aren’t happy with your purchase, you can cancel your policy hassle-free at the click of a button. We will help you with the cancellation and refund of your policy.

What is Term Insurance? 

Term insurance is the purest form of life insurance product that offers financial protection by providing a large life cover amount (sum assured) at comparatively low premium rates. In case of the policyholder’s death during the policy tenure, the life cover is paid to the beneficiary/nominee. As the name suggests, term insurance is an affordable insurance plan that offers coverage for a specific tenure or time. This plan helps cover expenses by your family members in case of your unfortunate death. 

one crore term plan

Term Plans


Life Cover

@ Starting from ₹ 16/day+


Life Cover

@ Starting from ₹ 8/day+


Life Cover

@ Starting from ₹ 12/day+

What are the Term Insurance Advantages and Disadvantages?

Now that we have understood what is term insurance, read on to learn more about term insurance advantages and disadvantages:

Advantages of Term Insurance Plan

Here is a list of the various advantages of term insurance that can help you make an informed decision.

  • Cost-effective: When comparing term insurance advantages and disadvantages, the affordability of term plans is one of the biggest advantages of term insurance. Term plans are one of the most cost-effective types of life insurance. The life assured can get large life coverage at the pocket-friendly term insurance premium cost, which makes it a favoured option for everyone. 

  • Large Sum Assured: With term plans, you can secure a high sum assured at affordable premiums. For example, you can secure a sum assured of Rs. 1 Crore at just Rs. 525 per month.

  • Rider Benefits: With the term insurance rider benefits, you can enhance the advantages of term insurance by increasing the policy cover at nominal premiums. By adding riders to the base plan, you can get coverage against critical illness, terminal illness, accidental death, accidental total permanent disability, hospicare, and waiver of premiums.

  • Flexibility: The term insurance plans offer a higher level of flexibility namely two aspects that are renewable and convertible. The life assured can renew the term insurance plan without undergoing any medical examination. The life assured can also covert the term plan into an endowment pan for the sum assured existing with the increased premium sum. It is easy to opt-out from the term plan wherein as soon as you stop paying the premium sum, the policy will cease, and that leads to ending the policy. Unlike endowment plans, the insured need not worry about the pay-outs. The term plans offer a death benefit and have no component of savings.

  • Easy to Buy: You can easily compare the premiums and benefits of term insurance plans offered by different insurers and select the most suitable plan for your profile. 

  • Simple: The term insurance plans are one of the easiest products compared to other life insurance products such as money-back plans, endowment plans, etc. Various other life insurance plans offer insurance as well as investment benefits. On the other hand, with a term insurance plan, you need to pay the premium sum and obtain life coverage for the policy term chosen.

  • Tax Benefit: You can also claim term insurance tax benefits as per the prevailing tax laws under sections 80C, 80D, and 10(10D) of the Income Tax Act, 1961.

Note: The tax benefit is subject to change in the prevailing tax laws.

one crore term plan

Secure Your Family Future Today


Term Plan Starting @ ₹449/month+

Get an online discount of upto 10%+

Compare 40+ plans from 15 Insurers

+Standard T&C Applied

Disadvantages of Term Insurance Plan

We have discussed the advantages of term insurance above, now let us understand the disadvantages of term insurance plan that will help you to make an informed decision:

  • The term plans are not meant for those who intend to save money for any specific needs such as higher education, retirement planning, marriage, and so forth.

  • When comparing term insurance advantages and disadvantages, term insurance plans are not designed to assist in terms of finances while the policyholders is still alive.

  • Buying a term insurance plan does not mean that it will enable you to create wealth. Moreover, they are no profit plans as they do not provide any hedge against inflation.

  • This type of life insurance plan is designed in a way wherein the life assured pays the specified sum only for the life coverage, which implies that the plans are not designed to build the cash value. The term premium is paid by the policyholder to the insurance provider with the intent to pay a death benefit to the nominee in case the policyholder is no longer around. When the life assured outlives the policy tenure, no benefit will be received in the case of a regular term insurance plan. However, in case of a term return of the premium plan, the entire premium amount paid throughout the policy tenure is returned on survival of the policy term.

Wrapping it Up

Term insurance plans are the most suitable life insurance options, especially for those seeking coverage during years of significant financial responsibilities. These plans can help your family off the remaining education loans and home loans. It is important not to rush the decision-making process; instead, take the time to assess your needs, weighing the term insurance advantages and disadvantages options. By carefully analyzing your financial liabilities and comparing them to your savings, you can identify the most suitable plan for yourself. Making an informed choice ensures that you and your family are well-protected, providing peace of mind amidst life's uncertainties.


  • Q: What are the term insurance advantages and disadvantages?

    Ans: Term insurance has some advantages, such as affordability, high life cover, payout options, tax benefits, different riders, etc. The disadvantages of term insurance are surrender amount and no cash value accumulation.
  • Q: What are the main advantages of term insurance?

    Ans: The main advantages of term insurance are the financial security of your loved ones in the event of your unfortunate demise during the policy tenure. These plans offer longer coverage with options to be covered till the age of 99 years. Also, the plan offers the option of enhancing the base cover using rider benefits or at different milestones.
  • Q: What are the disadvantages of term life insurance?

    Ans: Here is a list of disadvantages of term life insurance:
    • Premium depends on age
    • No component of investment
    • Surrender amount
  • Q: Is term insurance good or bad?

    Ans: Whether term insurance is good or bad depends on a person’s individual needs. Term insurance, in general, is a good financial product to buy as it ensures the financial stability of your family in case of an eventuality. These plans are affordable and offer a large life cover for a long policy tenure.
  • Q: Which company offers the best advantages of term insurance?

    Ans: The company that offers the best advantages of term insurance depends on an individual’s needs. You can learn more about the term insurance advantages and disadvantages and select the most suitable plan as per your requirements.
  • Q: Who gets the benefit of term insurance?

    Ans: Your family will receive the life cover or sum assured in case of your unforeseen death within the policy term.

Different types of Plans

Premium By Age

Term insurance articles

Recent Articles
Popular Articles
ABSLI  - Aditya Birla Sun Life Insurance Salaried Term Plan

06 Nov 2023

The Aditya Birla Sun Life Insurance (ABSLI) Salaried Term Plan
Read more
Term Insurance – A Long-Term Protection Plan for Your Children

03 Nov 2023

In this fast-paced and ever-evolving world, keeping your kids
Read more
Tata AIA Saral Jeevan Bima

05 Oct 2023

Tata AIA Saral Jeevan Bima is a pure risk cover plan that
Read more
Bajaj Allianz Term Insurance for NRI

03 Oct 2023

Today, many Indians live abroad, away from their family or loved
Read more
PNB MetLife Saral Jeevan Bima Review

07 Sep 2023

“I have opted for Term insurance plan of PNB MetLife. This is
Read more
What Are The Medical Tests Done For Term Insurance
Term insurance offers a sum assured to the beneficiary of the policyholder upon their death that can help them
Read more
Term Insurance for Women in India
Term insurance for women is a type of life insurance specifically designed for fulfilling women’s needs and
Read more
Best Term Insurance Companies in India 2023
Buying term insurance is a great way to protect your loved ones financially in the unfortunate event of your
Read more
LIC Term Insurance 1 Crore
LIC of India offers various plans to help you secure the financial future of your loved ones. In order to make
Read more
What Kind Of Deaths Are Not Covered In A Term Insurance Plan
A term insurance plan is the best way to ensure the financial well-being of your family members in case of any
Read more

View Plans
Download the Policybazaar app
to manage all your insurance needs.