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TERM INSURANCE

Guide To Buying Best Term Insurance

Rashmi Ghosh Rashmi Ghosh 06 March 2019

Choosing one term life insurance plan from the host of options offered by various insurance companies may look like a challenge. This article will ease out your confusion and help you in buying the best term plan available.

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Life never fails to surprise us. It’s full of uncertainties, both good and otherwise. And you need to do is secure your family’s future, even when you’re not around. When you’re looking for a life insurance plan, that will ensure financial security for your family, despite life’s uncertainties, term life insurance is the option you should explore. The Death Benefit that these plans offer comes to the rescue by assuring your nominee by paying a pre-determined sum assured, in case of your demise during the policy tenure. Now, let’s discuss some of the best online term insurance policies of the year.

Best Online Term Insurance Policies of 2019

LIC e-Term Insurance Plan: LIC is renowned for being the first and one of the most reliable insurance companies in India. This government-backed insurer consistently maintains a claim settlement ratio of over 98%, which is one of the highest among its competitors. e-Term Plan is one of the best term plans from LIC. It is a non-participating online term plan that assures the policyholder’s family by offering financial security in case of the unfortunate incident of his/her demise during the policy term. The policy, which can be purchased by any individual of 18 years and above, offers a policy tenure of up to 35 years. LIC e-Term Plan is designed to offer Death Benefit, payable to the nominee, if the policyholder dies during the policy term. However, in case of the policyholder commits suicide within 12 months from the date of purchasing the insurance, the insurer is liable to pay only 80% of the premium paid till the time of the death.

ICICI Pru iProtect Smart: This is a one-of-a-kind term insurance plan which protects the policyholder in case of being diagnosed with any of the listed 34 critical illnesses. ICICI Pru iProtect Smart, is customized to offer a cover till 75 years of age, along with four pay out options, which the policyholder can opt for as per his/her unique insurance needs. Apart from the convenience of being available online, policyholders are also eligible for three kinds of tax benefits annually.

Max Online Term Plan Plus: An effective online term insurance policy, Max Online Term Plan Plus offers coverage against specific illnesses, disabilities and death up to a maximum of 75 years of age. It specializes in offering three comprehensive coverage options - basic life cover, basic life cover and monthly income, and basic life cover and increasing monthly income. Individuals can select any one from these options as per their requirements. With one of the best claim settlement ratio of 98.26%, for FY 2017-18, Max Online Term Plan Plus is one of the options that individuals should consider while searching for the best term insurance.

SBI Smart Shield: A term insurance plan from SBI, one of the most reliable names in the banking sector, is tailor-made to ensure financial protection to the policyholder’s family in case of his/her unfortunate demise. With a minimum sum assured of Rs. 25 lakh, it offers three rider options - ‘Accidental death benefit rider’, ‘Criti care 13 Non-linked rider’ and ‘Accidental total and permanent disability benefit rider’.

HDFC Click 2 Protect Plus: This term insurance policy offers coverage for a maximum tenure of 40 years, with no ceiling on the upper limit. It assures the policyholder’s family of financial security in the unforeseen event of his/her disability, illness or death. It offers policyholders the flexibility to choose from four different coverages - Life Option, Extra Life Option, Income Option, and Income Plus Option.

Term Insurance or Whole Life Insurance – Which One Should You Buy?

Our objectives are seldom the same as everyone around us, aren’t they? Each of us has our own requirements, outlook and responsibilities that we have to fulfil. More so for life insurance coverage because it does not concern only us, but our families as well. Do you plan to purchase a life insurance policy for self or want to include your better half as well? Do you have children and/or dependent parents? We need to consider all these criteria’s and so much more while selecting a life insurance plan that is the best fit for our needs.

Let’s take a look at some of the insurance objectives that term insurance plans meet.

  • Lower premiums for high life insurance coverage.
  • Effective option for individuals looking for pure protection for a specific tenure
  • Best suited for those who want to ensure financial security of their dependents and protect them against the burden of debts like ongoing loans.
  • Only Death Benefit is applicable on term insurance plans. These do not offer any Maturity Benefit.
  • Offers the flexibility to opt for additional riders like accidental death, critical illness, etc., over and above basic term insurance plans to enhance their effectiveness.

Whole life insurance is appropriate for individuals with a different set of life insurance needs. Here are the features and benefits that make whole life insurance different from term insurance plans.

  • Offers the convenience of life insurance coverage for a longer duration i.e. 100 years of age.
  • Life coverage is applicable even after the completion of the payment of premiums
  • Tailor-made to ensure wealth creation for building a corpus for future insurance needs.
  • Death Benefit as well as Maturity Benefit is applicable on whole life insurance plans.
  • The cash value feature ensures liquidity by enabling policyholders to withdraw accumulated capital for meeting financial emergencies.
  • Besides, it also offers dividends, as per the existing capital market scenario and the type of whole life insurance plan. Therefore, it acts as an effective investment tool as well.

Best Term Insurance Plans in India with Claim Settlement Ratio

Below is the illustration with incurred claim ratio of leading insurance companies for the FY 2017-18.

Insurance CompaniesBest Online Term Insurance PlansClaim Settlement Ratio (%)
LICLIC e-Term Plan98.04
ICICI PrudentialICICI Pru iProtect Smart97.88
SBISBI Smart Shield96.76
HDFCHDFC Click 2 Protect Plus97.8
Max Max Online Term Plus98.26

To conclude…

Buying a term life insurance plan that is the best fit for your unique requirements may not be as challenging as it might appear. Not if you opt for the best term insurance plans from insurers with good claim settlement ratio. This ratio is the percentage of claims settled by the insurance companies in a year, indicating at the chances of having your claim settled, in case you make one. This speaks volumes about the reliability and efficiency of customer services. Read carefully through the features and benefits of each of these term insurance plans and make a choice for the one that best suits your needs.

Rashmi Ghosh
Written by Rashmi Ghosh
Digital enthusiast, dreamer with a colourful mind and shares her soul with canines. She survives on coffee, and food and travel feature among her topmost priorities.