Considering buying a 50 Lakh Term Insurance Plan? Here is What you Need to Know

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Term insurance policies are a type of life insurance plan offered by insurance companies to guarantee a safeguard for one’s family and dependents in the event of one’s death or disability by providing financial coverage against the premiums paid by the policyholder if the policy is active. The coverage amount, known as the sum assured, is paid as a “death benefit” in the event of the insured's passing during the policy term.

Term Insurance Plans

Term insurance plans are comparatively the most affordable life insurance policy as they provide large amounts of coverage against relatively low premiums. This is because term plans are purely risk-based – meaning the entire sum paid by policyholders as a premium is kept in reserve for payouts if the policy is claimed. If the policy matures or expires while the policyholder is still alive, there is no monetary benefit. In case of survival of the insured beyond the policy maturity date, the policy buyer has to renew his coverage, presumably under different payment conditions, or forgo their insurance entirely.

Most term insurance policies also offer some payout in the event of permanent or partial disability through critical illness or accident, such that the policyholder’s regular means of livelihood is disrupted.

What to Know Before Buying Term Insurance Plans?

There are several options for purchasing term insurances, as various insurance companies offer different types of insurance packages targeting different types of individuals. Readers should be aware of the following details with regards to term insurance:

  • Claim Settlement Ratio – The ratio of the number of claims settled by an insurance company compared with the number of claims filed. An insurer with a higher claim settlement ratio (>99%) will be less likely to reject claims filed against any policy.
  • Max limit – Most term insurances provide a maximum period of coverage of 75-100 years. In general, more extended periods of coverage will require higher premiums.
  • Life Cover – Life cover refers to the total lump sum assured amount distributed to the beneficiaries of the policyholder.
  • Rider policies or Add-ons – The term policies offered by various insurance companies have different add-on options that increase policy coverage, provide additional payouts or various other benefits. Examples of standard rider policies include an "extra payout in the event of accidental death,” “return of premium on policy maturity,” and “coverage against critical illnesses.”
  • Some policies provide a “waiver of premium cover,” which means that the policyholder will be exempted from paying additional premiums if they are impacted by an illness or injury that affects their livelihood.
  • The premium required for the policy increases with the age of the applicant at the time of registration, whether the applicant smokes, the amount being insured for, and any pre-existing health conditions the applicant might have. Disclosure of the full health information of the applicant is required, and violation of the same will be grounds for rejection of any policy claims.
  • Term insurance premiums often rise significantly with age. Consumers should keep this in mind when applying for a policy, as they will have to pay much higher premiums if they have to renew their policy in the event that they are alive at the time of policy expiry. Consumers should, therefore ideally, purchase a term insurance plan as soon as they start earning a decent monthly salary, and it is recommended to purchase a policy that provides coverage for at least 65 years.
  • The Income Tax act provides tax benefits for payments made towards term insurances.

Popular Term Insurance Plans 

The below table lists some well-reputed and popular term insurance plans.

Popular providers of Rs. 50 Lakh term insurance policies:

Insurer

Life cover

Max Limit

Claims settled

Rider policies*

Monthly premium*

ICICI Prudential iProtect smart

50.1 Lakh

85 years

97.8%

 

Waiver of premium cover

Free

100% payout on terminal illness

Free

Extra payout on accidental death

Rs. 58

Cover against 34 critical illnesses

Rs. 142

Rs. 972

Max Life insurance 

Smart Secure Plus

50 Lakh

85 years

99.2%

 

Get your premium back at age 55

Free

Early payout on terminal illness

Free

Option to skip premiums

Rs. 49

Extra payout on accidental death

Rs. 62

Waiver of premium

Rs. 15

Cover against 64 critical illnesses

Rs. 416

Rs. 657

PnB MetLife

Mera Term Plan Plus

50 Lakh

99 years

97.2%

 

Child education support benefit

Rs. 40

Cover for spouse

Rs. 418

Waiver of premium and 100% payout in case of terminal illness

Rs. 141

Extra payout on accidental disability

Rs. 16

Extra payout on accidental death

Rs. 82

Extra payout on cancer and heart attack

Rs. 53

Extra payout on 10 serious illnesses

Rs. 186

Rs. 627

Aegon life 

iterm

50 Lakh

100 years

98.0%

 

100% payout on terminal illness

Free

Extra payout on accidental death

Rs. 48

Rs. 615

Canara HSBC OBC

iSelect Star

50 Lakh

99 years

98.1%

 

100% payout on terminal illness

Free

Cover for child

Rs. 368 

Rs. 736

Edelweiss Tokio life

Zindagi+

50 Lakh

80 years

97.8%

 

Extra 50% cover for spouse

Available

Cover for spouse

Rs. 19

Waiver of premium

Rs. 26

Enhanced critical illness

Rs. 180

Death due to accident

 Rs. 52

Disability due to accident

Rs. 42

Hospicare benefit

Rs. 169

Rs. 563

Aditya Birla Capital

Digishield Plan

50 Lakh

80 years

97.5%

 

Early payout on terminal illness

Free

Extra payout on accidental death

Rs. 74

Cover against accidental disability and death

Rs. 159

Cover against 4 critical illnesses

Rs. 170

Cash for hospitalization

Rs. 1051

Waiver of premium

Rs. 35

Rs. 680

SBI life insurance

eShield

50 Lakh

80 years

94.5%

 

100% payout on terminal illness

Free

Extra payout on accidental death

Rs. 53

Additional benefit on accidental disability

Rs. 42

Rs. 812

Bharti AXA

Premier protect

50 Lakh

75 years

97.3%

 

Extra payout on accidental death

Rs. 51

Cash for hospitalization

Rs. 138

Rs. 435

Kotak life

Kotak e-term plan

50 Lakh

75 years

96.3%

 

Cover against 37 critical illness

Rs. 294

Cash for hospitalization

Rs. 138

Rs. 514

ICICI prudential 

POS – iprotect Smart

50 Lakh

65 years

97.8%

 

Extra payout on accidental death

Rs. 239

Rs. 640

India first

e-term plan

50 Lakh

65 years

96.7%

 

Death due to accident

Rs. 144

Disability due to accident

Rs. 129

Critical illness

Rs. 1340

Rs. 344

Exide life insurance

Elite term plan

50 Lakh

65 years

98.1%

No riders available

Rs. 420

Exide life insurance 

Smart term edge comprehensive

50 Lakh

55 years

98.1%

No riders available

Rs. 681

Aditya Birla Capital 

Lifeshield plan

50 Lakh

80 years

97.5%

Early payout on terminal illness

Free

Cover against accidental disability and death

Rs. 159

Cover against accidental death

Rs. 74

Cover against 4 critical illnesses

Rs. 170

Cash for hospitalization

Rs. 1081

Surgical care

Rs. 842

Rs. 695

*The premiums and rider costs mentioned in the above table are values calculated for Rs. 50 lakh term insurance for a 25-year-old, non-smoking male, and only meant to act as a guide for comparison purposes. Policy premiums are subject to change with market conditions and will vary based on the health and income of the policy seeker. Readers are therefore encouraged to conduct their own due diligence before applying to a life insurance policy.

Benefits of Buying Rs 50 Lakh Term Insurance

There are several reasons why one might opt for a Rs50 Lakh term insurance policy at various stages of their life – 

  • One in their twenties might opt for the term insurance plan to provide financial safety against education loans taken out by their parents for their higher studies and provide for their parents later in life.  
  • In their thirties, A life insurance policy such as Rs. 50 Lakh term insurance plan can provide a means for one’s loved ones to overcome their financial liabilities such as loans against property, vehicles, etc., that the policyholder might have taken out. 
  • In their forties, the sum assured to the dependents of the policyholder will provide financial security and guarantee their dependents’ needs and life goals, such as children’s education or marriage, will be provided for.
  • The modern-day lifestyle often results in various ailments and diseases. Most insurance plans have provisions to safeguard one's dependents and loved ones after their passing while also providing protection coverage against critical illnesses. 

Wrapping it up

The advent of online term plans has allowed consumers to easily compare various options and choose the one most appropriate to their needs, as well as calculate the premium required as per their requirements for coverage. Online term plans often provide significant discounts compared to the alternative, as the insurance agencies make savings on the expenditures associated with physical insurance policy sales through agents. Consumers can now leverage the increased convenience and superior savings from the comfort and safety of their homes. 

It should, however, be noted that most of the policy plans mentioned in the above table will compulsorily require an official medical health check-up before the buyer can be enrolled in the policy. This is because insurance providers will take the policyholder's health into account while assessing their risk profile to determine a suitable premium. 

Disclaimer: Policybazaar does not endorse, rate, or recommend any particular insurer or insurance product offered by an insurer.

*All savings are provided by the insurer as per the IRDAI approved insurance plan. Standard T&C apply.

**Tax benefit is subject to changes in tax laws.

Written By: PolicyBazaar
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Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
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