Best 2024 Term Insurance Plans in India (Updated 26 Jan 2024)

Discover 2024's Best Term Insurance in India (Updated 26th Jan 2024)

Term insurance provides straightforward life coverage with fixed premiums over a specified period, known as a 'term' policy. Choosing the right term insurance plan is crucial for those with dependents, ensuring security and value for money. In India, the premium for an ideal term insurance plan is influenced by factors such as age, gender, premium payment term, policy duration, and the chosen sum assured. Selecting wisely ensures a balance of financial protection and affordability for individuals and their loved ones. Every health insurance or investment policy, whether it involves mutual funds for short-term or long-term goals, should be carefully planned and thoroughly researched to ensure fruitful outcomes.

 

Table of Content.

1. What is Term Insurance.
2. Why Term Insurance.
3. When to Consider Term Insurance.
4. Coverage Considerations for Term Insurance Policy.
5. Who Should Buy Term Insurance.
6. Benefits of Buying a Term Insurance Policy.
7. Choosing the Best Term Insurance Plan in India for 2024.
8. Top Term Insurance Plans for 2024.
9. Documents Required for Term Insurance Policy.
10. Eligibility for Term Insurance.
11. Conclusion

Key Insights: -

• Discover the best 2024 Term Insurance plans in India.
• Explore comprehensive coverage and tailored plans.
• Understand benefits and features of leading insurers.
• Consider factors like CSR, entry age, and sum assured.
• Choose wisely based on your specific needs and preferences.

What is Term insurance

(1) Term insurance serves as a robust financial mitigation plan.

(2) Pay a consistent premium over a predetermined period for budgetary stability.

(3) Insurance company steps in to provide financial support to the policyholder's dependents in adverse situations.

(4) Beneficiaries receive a pre-determined sum, known as Sum Assured, ensuring financial security.

(5) Guarantees a reliable payout, except in cases of fraud, misinformation, or misrepresentation.

Why Term Insurance                                

(1) When you are only Bread winner to the family.

(2) Provides compensation for the monetary loss resulting from the untimely death of the breadwinner.

When to Consider Term Insurance

(1)  When you are the sole breadwinner in your family.

(2) When you have financial dependents relying on your income.

(3) Especially crucial if you have outstanding loans to ensure your family is not burdened.

What should be Coverage for Term Insurance Policy

(1)  Aim for coverage 15 to 20 times your annual income for adequate income replacement. Depending upon your paying ability.

Mathematically, the formula can be expressed as:

Coverage Amount=Annual Income× Multiplier Coverage Amount=Annual Income× Multiplier

2. Include the total of outstanding debts, such as mortgages and loans.

3. Factor in education costs and anticipate future needs.

4.Allocate an additional amount as an emergency fund for unforeseen circumstances.

5. Consult financial experts for personalized guidance on your coverage amount.

Who should buy Term Insurance?

1. Breadwinners: If you are the primary income earner for your family, term insurance ensures financial protection for your dependents.

2. Financial Dependents: Individuals with family members or dependents relying on their income should opt for term insurance to secure their financial future.

3. Debt Obligations: Those with outstanding debts, such as mortgages or loans, can use term insurance to cover these financial responsibilities.

4. Young and Healthy Individuals: Acquiring term insurance early, especially when you are young and healthy, can result in more affordable premiums.

Benefits of buying a Term Insurance policy.

1. Cost-Effective Coverage:

   - Premium rates for the finest term insurance plans are impressively low, providing substantial life coverage. Buy Term Insurance policy as early as possible.

2. Lifetime Protection:

   - Top plans offer whole life coverage, ensuring prolonged financial security for your family.

3. Flexible Payout Options:

   - Optimal term plans in India allow you to choose payout options for the sum assured, offering a reliable income stream. Check the premium of normal plan vs such plans.

4. Premium Refund Feature:

   - Many plans provide the option to receive paid premiums back at the end of the term, serving as a valuable maturity benefit. However, steer clear of these plans, as the gap between regular and premium refund options is substantial. Opt for a standard Term Insurance plan instead and invest the surplus amount in Mutual funds. This strategy yields higher returns, outpacing inflation and the time value of money.

5. Enhanced Coverage with Riders:

   - Best term insurance plans offer additional riders for tailored coverage, addressing specific needs. Please verify the premium for the standalone policy offering this coverage and make an informed decision.

6. Flexible Premium Payments:

   - Choose the payment mode and frequency at your convenience, with options like single, regular, or limited payments. Check Term and conditions for such options.

8. Convenient Online Access:

   - Procure the best term insurance plan easily through online or offline channels, with online purchases often offering exclusive benefits.

9. Factors Influencing Term Insurance Premiums:

Age, health, lifestyle, coverage amount, policy term, gender, occupation, riders, medical history, and payment frequency impact premiums.

 Choosing the Best Term Insurance Plan in India for 2024

Step 1: Assess Your Needs

   - Determine the sum assured based on your family's financial goals, considering income, liabilities, dependents, lifestyle, inflation, and monthly investments.

Step 2: Evaluate Risk Cover

   - Understand the death benefit provided by the term plan to ensure financial stability for your family in case of untimely demise.

Step 3: Explore Term Plan Types

   - Familiarize yourself with regular term plans, return of premium plans, no-cost term plans, and whole life insurance policies. Its important to read all policy wordings or asking questions from the insurer, as its for your loved ones.

Step 4: Choose a Reliable Insurer

   - Consider Claim settlement ratio SR and Solvency Ratio. Higher CSR indicates better claim settlement, while a solvency ratio above 1.5 ensures financial stability. All such information can be found on IRDAI official site.

   - *CSR Calculation: * CSR = (Total Number of Claims Settled / Total Number of Claims Made) x 100.

Step 5: Compare Plans

   - Compare based on premium rates, CSR, policy term, sum assured, critical illness coverage, and additional benefits.

Step 6: Explore Additional Riders

   - Enhance coverage with riders like Waiver of Premium, Accidental Death Benefit, Critical Illness Rider, Hospicare Benefit, Accidental Total and Permanent Disability, and Terminal Illness Benefit.

Step 7: Calculate Premium

   - Use an online term insurance calculator to determine a budget-friendly premium for the desired sum assured.

By following these concise steps, you can confidently choose the best term insurance plan in India for 2024.

(1) ICICI Prudential Life Insurance - iProtect Smart

CSR: 97.82%

Entry Age: 18 - 65 years

Maturity Age: 99 years

Sum Assured: 50 Lacs - 20 Cr

Key Features:

• Special rates for non-tobacco users
• Flexible premium payment options
• Various benefit payout options
• Terminal illness coverage
• Disability coverage

(2) HDFC Standard Life Insurance - Click 2 Protect Super

CSR: 98.66%

Entry Age: 18 - 65 years

Maturity Age: 85 years

Sum Assured: 50 Lacs - 20 Cr

Key Features:

• Return of Premium option
• Multiple plan options
• Optional Waiver of Premium Benefits
• Critical Illness and Disability coverage
• Choice of premium payment frequency
• Accidental Death Benefit rider
• Accelerated Critical Illness Benefit
• Premium waiver on critical illness or disability

(3) Max Life Insurance - Smart Secure Plus

CSR: 99.34%

Entry Age: 18 - 60 years

Maturity Age: 85 years

Sum Assured: 25 Lacs - 10 Cr

Key Features:

• Affordable term plan
• Various premium paying terms
• Extra rider benefits
• Free-look period of 30 days

(4)  TATA AIA Life Insurance - SRS Vitality Protect

CSR: 98.53%

Entry Age: 18 - 60 years

Maturity Age: 85 years

Sum Assured: 50 Lacs - 2 Cr

Key Features:

• Wellness program benefits
• Guaranteed premium rate discount
• Free health check-ups
• Survival benefits through the wellness program
• Premium discounts for maintaining good health

(5) Bajaj Allianz Life Insurance - eTouch Online Term Plan

CSR: 99.02%

Entry Age: 18 - 55 years

Maturity Age: 99 years

Sum Assured: 50 Lacs - 10 Cr

Key Features:

• Guaranteed annual pay-out
• Multiple payout options
• Maximum maturity age of 70 years
• Family Income Benefit option
• In-built Accidental Death Benefit

(6) PNB MetLife India Insurance - Mera Term Plan Plus

CSR: 97.33%

Entry Age: 18 - 50 years

Maturity Age: 80 years

Sum Assured: 50 Lacs - 1 Cr

Key Features:

• Additional coverage for spouse
• Flexible coverage enhancement options
• Lower premium rates for non-smokers and females
• Step-Up Benefit for increasing coverage over time
• Child Education Support Benefit

(7) Canara HSBC OBC Life Insurance - Young Term Plan

CSR: 98.44%

Entry Age: 18 - 60 years

Maturity Age: 99 years

Sum Assured: 25 Lacs - 20 Cr

Key Features:

• Return of premiums on survival.
• Early exit option with premium return.
• Premium waiver on critical illness or disability.
• Spousal coverage available.
• Premium increase to 100% of the base sum assured.

(8) Kotak Mahindra Life Insurance - e-Term Plan

CSR: 98.82%

Entry Age: 18 - 65 years

Maturity Age: 85 years

Sum Assured: 50 Lacs - 10 Cr

Key Features:

• Low-cost, high coverage.
• Step-up option for coverage enhancement.
• Three pay-out options and plan options.
• Rider benefits available.
• Special life event option for coverage increases.
• Terminal illness benefit.

(9) Aegon Life Insurance - iTerm Prime

CSR: 99.03%

Entry Age: 18 - 65 years

Maturity Age: 70 years

Sum Assured: 25 Lacs - 1.25 Cr

Key Features:

• Special exit feature for premium return
• Flexible premium payment modes
• Additional coverage options through riders

(10) SBI Life Insurance - eShield Next

CSR: 97.05%

Entry Age: 18 - 65 years

Maturity Age: 85 years

Sum Assured: 50 Lacs - 10 Cr

Key Features:

• Various premium paying options
• Affordable premium rates
• Customizable coverage options
• Additional benefits for enhanced customization
• Death Benefit Payment Mode customization

(11) Aditya Birla Sun Life Insurance - DigiShield Plan

CSR: 98.07%

Entry Age: 18 - 60 years

Maturity Age: 85 years

Sum Assured: 50 Lacs - No Limit

Key Features:

• 10 plan options
• Inbuilt terminal illness benefit
• Accelerated Critical Illness Benefit option
• Flexible death benefit payout options
• Lump-sum, monthly income, or combined death benefit options
• Monthly income after age 60 for financial independence

(12) LIC (Life Insurance Corporation of India) - New Tech Term Plan

CSR: 98.50%

Entry Age: 18 - 65 years

Maturity Age: 80 years

Sum Assured: 50 Lacs - No Limit

Key Features:

• Non-participating pure life insurance
• Level or Increasing Sum Assured options
• Flexible premium payment terms
• Special rates for women and non-smokers
• Optional Accidental Benefit Rider
• Benefit payout in instalments for financial planning
• Premium discounts for women and non-smoker 

 

Note: The list of the best term insurance plans for a 1 crore life cover for the profile of an 18-year-old, non-smoking male.

Important Points:

(1)  Full Disclosure: Transparently disclose all health issues for smooth claims processing.

(2) Family Communication: Keep nominees informed about policy and investment details for Health, Long-term, or Short-term investments.

Documents for Claim Process 

• The filled-out claim intimation form
• The original and attested copy of the policyholder’s death certificate
• Original term policy documents
• Documents of the nominee, including Address proof and photo ID proof
• Last medical certificate issued to the policyholder
• All medical records
• Bank account proof of Nominee

Documents required for Term Insurance 

Identity Proof

- Aadhar card
- Passport
- Driver's License


Income Proof

- Salary slips
- ITR
- Form 16 (salaried)
- Business/profit-loss statements (self-employed)


Address Proof 

- Utility bills
- Rental agreement
- Address ID


Medical Proof

- Medical examination reports (if required)
- Pre-existing medical condition details (if applicable)

Eligibility for Term Insurance

Entry Age

- Minimum: 18 years
- Maximum: Typically around 65 years (varies)


Policy Tenure

- Varies with options available
- Maximum Age: Usually up to 40-50 years or until a certain age (e.g., 75 years)


Premium Payment Terms

Regular Premium

- Throughout the policy tenure

Limited Premium

- Fixed term (e.g., 10, 15, or 20 years)

Single Premium

- One-time payment at policy inception

Its starting point and enjoy your journey for buying the policy.

In the realm of term insurance, industry leaders ICICI Prudential, HDFC Standard, and Max Life provide comprehensive plans with special rates, flexible premiums, and inclusive benefits. TATA AIA, Bajaj Allianz, and PNB MetLife stand out with wellness-focused policies boasting CSR rates over 97%. Canara HSBC, Kotak Mahindra, and Aegon Life offer innovative features like premium return and spousal coverage. SBI Life, Aditya Birla Sun Life, and LIC present diverse choices with customization options. 

A well-informed choice in term insurance ensures tailored solutions, aligning seamlessly with individual aspirations, financial goals, and promoting peace of mind.

FAQS ON TERM INSURANCE

Q1: What happens if I miss a premium payment?

 A: Insurance companies typically provide a grace period for overdue payments. If not paid within this period, the policy may lapse.

Q2: Can I increase or decrease my coverage during the policy term?

A: Yes, some plans allow coverage adjustments during the term. Increasing may require underwriting, and decreasing can impact premium and benefits.

Q3: Is there a waiting period before the coverage becomes effective?

A: Generally, there's no waiting period. Coverage begins once the first premium is paid, pending investigation for non-disclosure.

Q4: What factors can impact the claim settlement process?

A: Factors like non-disclosure, exclusions, or specific conditions can impact claim settlements. Full transparency during application is crucial.

Q5: Are there any exclusions or situations not covered by term insurance?

A: Yes, policies may exclude events like suicide in the first year. Review the policy document for limitations.

Q6: Can term insurance be surrendered before the policy term ends?

A: Term policies usually can't be surrendered for cash. Some may have surrender or return of premium options with conditions.

Q7: How are premiums calculated, and can they change over time?

A:  Premiums are calculated based on factors and are usually fixed. Some policies may have adjustable premiums.

Q8: Are there tax benefits associated with term insurance?

A: Yes, premiums are often eligible for tax benefits. Death benefits are typically tax-free. Consult a tax professional for current laws.

Q9: Can I convert my term policy into a permanent life insurance policy?

A: Some term policies allow conversion to permanent life insurance without additional underwriting.

Q10: What should I do if my personal or financial situation changes?

A: Update your policy for major life changes. Contact your provider to adjust coverage or beneficiaries to align with current needs.

Q11: Can term insurance be renewed after the policy term ends?

A:  Generally, term policies don't offer renewal after the term ends. It's essential to understand the policy's terms during purchase.

Q12: What if I want to change my nominee?

A: You can usually change your nominee during the policy term. Contact your insurance provider for the necessary forms and procedures.

Q13: Are NRIs eligible to purchase term insurance?

A: Yes, NRIs (Non-Resident Indians) can typically buy term insurance. Check policy details and eligibility criteria, as they may vary among insurers.

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