Term Insurance Benefits

What are the Term Life Insurance Benefits?

Here is a list of all the top 10 term insurance benefits you can avail of by buying a term life insurance in India in 2026:

• Financial Protection 

• Affordable Premiums

• Income Replacement 

• Easy to Buy

• Whole Life Cover

• Accidental Death Cover

• Multiple Death Benefit Payout Options

• Additional Riders for Enhanced Coverage

• Income Tax Benefits

• Critical Illness Coverage

• Return of Premium Option

• Flexible-Premium Payment Modes

1. Financial Protection

   This is one of the most important term insurance benefits from which the policyholder gets the peace of mind knowing that the financial future of your family and dear ones is protected in case of your absence.

2. Affordable Premiums

   You can easily get a high life cover term insurance plan by paying low premium amounts. The premium payments can be made on an annual, semi-annual, quarterly, and monthly premiums. The premium depends on your cover amount, age, policy term and other factors.
   For example, a healthy 30-year-old non-smoker can get a ₹1 crore cover for just ₹403/month.

   Tip - Buy early, each year you delay can raise your premiums by 4–6%, with steeper increases after age 40.

   Before purchasing any term plan you can easily calculate the term insurance premium by using this online term insurance calculator.

3. Income Replacement

   The maturity benefit in term insurance as a cover amount acts as an income replacement for the family or the nominee. Using that amount the needs can be fulfilled and the family’s future remains secure. You get an option to get the maturity benefit in parts, instead of a lumpsum, it acts as an income replacement .

4. Easy to Buy

   One of the main term life insurance benefits is that you can purchase the most suitable term plan from the comfort of your home in a few clicks. You can go through the policy documents, compare term plans, and their CSR ratios before selecting the right term insurance for yourself and buy online in just a few minutes.

5. Whole Life Cover

   Term insurance plans offer the option of extending the policy term to cover the policyholder for their whole life, i.e., till 99 or 100 years of age. With these whole life insurance plans, the policyholder can ensure that their dependents are financially secure for their whole life.

6. Accidental Death Cover

   Another term insurance benefit is the accidental death rider that make life stress-free. This is an additional cover that pays an additional amount on top of the base sum assured in the event of the policyholder’s untimely death.

7. Multiple Death Benefit Payout Options

   Most term insurance companies in India provide the policyholder with the option to select a suitable benefit payout option. The policyholder can choose if he/she wants the death benefits of term life insurance to be paid in a lump sum amount, monthly installments, or a combination of both.

8. Additional Riders for Enhanced Coverage

   The riders available with term insurance plans allow you to increase the term insurance benefits of the basic life cover. For a small amount of extra premium, you can include riders in your term insurance plan.
   The important term insurance riders in India are accidental death benefit, accidental total permanent disability benefit, terminal illness benefit, critical illness benefit, hospicare benefit, and waiver of premium benefit riders.

9. Income Tax Benefits

   There are several term life insurance benefits that you can avail of by buying a term plan. You can claim term insurance tax benefits under sections 80C, 80D, and 10(10D) of the Income Tax Act of 1961 as per the prevailing tax laws.

10. Critical Illness Coverage

    Adding the critical illness coverage to the base term plan can ensure additional coverage against the diagnosis of covered critical illnesses. The rider sum assured can help take care of medication and treatment costs.

11. Return of Premium Option 

    A term insurance plan provides life cover to the nominee/beneficiary in case of the life assured’s unforeseen death. It doesn’t provide any maturity benefit. However, you can receive maturity benefits under a term plan if you buy a Term Return of Premium Plan (TROP). This option provides term insurance benefits to safeguard your income, has slightly higher premiums, and returns the full premium paid by you if you survive the policy term.

12. Flexible-Premium Payment Modes

    Several term plans often offer various premium payment terms and modes to help the policyholder pay the premiums at their convenience. You can choose to pay for a limited, regular, or single premium payment term on a monthly, quarterly, yearly, or half-yearly basis.

13. Different types of term insurance

    There are different types of term insurance: Level term plans, decreasing term plan, increasing term insurance, and convertible term plans.

What are the Rider Benefits of Term Life Insurance?

Let us take a look at all the available riders that you can add to the base plan to enhance your term insurance benefits:

• Critical Illness Rider: A critical illness rider pays the rider sum assured in case of diagnosis of a critical illness listed under the policy documents to help take care of the treatment costs.

• Terminal Illness Rider: A terminal illness rider pays out either the entire or a part of the base sum assured to the policyholder in advance on the diagnosis of the terminal illness. 

• Accidental Death Benefit Rider: In case of policyholder’s accidental death during the policy term, the insurer pays the rider sum assured, along with the base life cover, to the nominee of the policy.  

• Accidental Total Permanent Disability (ATPD) Rider: On the total and permanent disability due to an accident, the insurer pays the ATPD rider sum assured to the policyholder.

• Waiver of Premium Rider: In case of a job loss due to the diagnosis of a critical illness or accidental total permanent disability of the policyholder, the insurer waives off all the remaining premiums. The term insurance policy will still remain active and continue its cover as usual for the entire policy term.

• Hospicare Benefit Rider: The hospicare benefit rider pays a percentage of the base sum assured in case the policyholder is hospitalized. These rider advantages of term life insurance are especially helpful in paying off hefty hospital bills and help you focus on your recovery without straining your bank.

Who Needs Term Insurance Plans in India 2026?

• Working professionals

• Married individuals

• Parents

• Home loan or personal loan borrowers

• Self-employed individuals

• Young earners in their 20s–30s

• Single-income families

• Business owners/Self-employed

• Individuals with ageing parents

• Anyone seeking affordable, high life cover

Why Buy Term Life Insurance Plan From Policybazaar?

You can get the following additional term insurance benefits by buying from Policybazaar:

• Policybazaar offers dedicated claim assistance for term insurance plans.

• The company offers an exclusive lifetime discount of up to 5% on online term plan purchase

• All the calls are 100% recorded to avoid misselling to the customers

• The Policybazaar advisors are available in over 55 cities and can provide offline support and help you understand the plans and documentation

• You can cancel the policy at the click of a button in case you are unsatisfied with your policy purchase

Common Customer Queries Answered

How Do You Choose the Best Term Insurance Plan in India 2026?

With the availability of various term plans online, choosing the best term insurance plan for your needs is difficult and then determining the benefits of term life insurance. Thus, with the help of below factors, getting enough term coverage can be easy:

• Sum Assured: Always check the higher and the lower limits of the sum assured for the different term plans. This provides greater flexibility when selecting adequate coverage for a family’s financial security.

• Policy Term: Choose a term plan that provides flexibility in policy terms. Select a life cover that suits your needs, whether it's for 15 years, 40 years, or even up to 100 years, with specific term plans, ensuring you can adequately protect your family for the desired duration.

• Low premium rates: While term plan premiums are affordable, the specific amount may differ between plans. Comparing various term plans enables you to identify policies with affordable premiums, preventing financial strain.

• Claim Settlement Ratio (CSR): The term insurance company should always have a reliable and high CSR. This indicates that the insurance company will settle the death claim when required, without any hassle.

• Option to Choose Riders: Your term plan should let you choose from a list of optional riders. This way, you can get extra protection against certain risks or events, like the costs of a critical illness or being in the hospital.

• Buying online: Buy term plan that offers easy online purchase. In addition to instantly accessing the policy documents, you should have the convenience of customizing the plan and making premium payments online from your digital device.

Final Thoughts

There are many term life insurance benefits, but the most important of those is the financial security it provides to the policyholder's family, a chance to beat inflation with the maturity benefit option, and the term insurance tax benefits. You can also avail of these term insurance benefits by comparing and buying the most suitable term plan online in just a few clicks.

FAQs