When you buy a term insurance plan, you must have come across the word nominee, dependent, or beneficiary. These three words are integral to a term insurance policy cover. A term insurance coverage policy is designed to assist your family in case something were to happen to you in the future. It is a complete protection plan with a fixed payout amount.
The payout is received in the form of a lump sum or in the form of regular intervals (monthly, semi-annually, quarterly, or annually). The payout is predetermined at the time of purchasing the policy. An ideal sum assured should be between 15x to 20x of your annual income. The entire process of payout comes under the death benefit option. Every term plan comes with a death benefit that requires you to mandatory select a nominee. Note: Term policies are pure protection plans. They do not come with a survival or maturity benefit unless declared by the insurer.
As mentioned above, every term insurance cover policy requires you to select a nominee. It is mandatory for you to fill in the details of your nominee as accurately as possible. Your nominee can be your family member or members (spouse, children, or parents, or the entire family). Some insurance plans also allow parents-in-law, uncles, aunts, and adopted dependents, distant relatives, as nominees. In the case of distant non-blood relatives, it is crucial to provide the relevant documentation as proof to the insurance company. Failure to do the same might lead to rejection of the claim.
At Coverfox, you can avail of a free nominee assistance program that will ensure your nominee gets the rightful claim amount. Plus, you can manage all of this on-the-go with a single application.
The sum assured along with the bonuses, if any, is paid to your nominee in case of your unfortunate demise. Here are six benefits of having a nominee:
As mentioned above, the very purpose of purchasing a term insurance protection cover policy is to protect the family of the policyholder. Term insurance is a contract under which the insurance company will pay a fixed amount to the beneficiary in case of the policyholder’s death.
A suitable nominee will ensure that your family is well taken care of in your absence. Therefore, you must select a person who you trust the most as a nominee. He/She will be responsible for your family post your departure. You can also make your distant friend or non-blood relative as a nominee.
You also have the option of adding multiple nominees. This is ideal if you want the sum assured to be split equally among your children and spouse. You can also make ordinal nominations. Under this option, if the desired nominee does not survive the policy term, you can select a second person.
Many term insurance providers provide the option of sharing the death benefit. If you have more than two children/nominees, you can split the death benefit amount as per your preferred ratio.
Like all other types of insurance policies, you also have the option to cancel a nominee at any point in time and any number of times during the policy term.
In case of the death of the policyholder, the following information must be furnished to the insurance company for making a claim.
Now that you are aware of the importance of the nominee, here is a list of the best term insurance policies in India.
| Term Insurance Plan | Policy Term | Entry Age | Cover Amount (Min/Max) |
|---|---|---|---|
| Tata AIA Maha Suraksha Supreme | 10-40 years | 18-70 years | Rs. 50 lakhs to Rs. 2 Crores |
| SUD Life Abhay | 15-40 years | 18-70 years | Max life cover of Rs. 100 Crores |
| Shriram Life Cash Back Term Plan | 10-25 years | 12-50 years | Rs. 2 lakhs - Rs. 20 lakhs |
| SBI Smart Shield | 18-60 years | 18-60 years | Rs. 25 lakhs |
| Sahara Kavach | 15-20 years | 18-50 years | Rs. 5 lakhs minimum |
| PNB MetLife Mera Term Plan | 18-65 years | 18-65 years | Rs. 10 lakhs to Rs. 5 Crores |
| IndiaFirst Anytime Plan | 5-40 years | 18-60 years | Rs. 10 lakhs to Rs. 49 lakhs |
| HDFC Life Click2Protect 3D Plus | 18-65 years | 18-65 years | Rs. 1 Crore |
| Exide Life Smart Term Plan | 10-30 years | 18-65 years | Rs. 5 lakhs to Rs. 10 lakhs |
| Edelweiss Tokio Life My Term+ | 10-85 years | 18-65 years | Rs. 25 lakhs to Rs. 50 lakhs |
| Aviva LifeShield Advantage Plan | 10-30 years | 18-65 years | Rs. 50 lakhs |
| Aditya Birla Sun Life Protector Plus Plan | 5-70 years | 18-65 years | Rs. 30 lakhs minimum |
Disclaimer: The above information has been sourced from the official website of the respective insurance company. (last updated on 26-10-2020)
| Term Insurance Plan | Policy Term | Entry Age | Cover Amount (Min/Max) |
|---|---|---|---|
| SBI Life eShield Plan | 18-65 years | 18-65 years | Rs. 25 lakhs |
| Max Life Online Term Plan Plus | 18-60 years | 18-60 years | Rs. 2 Crores |
| LIC E-Term Plan | 5-75 years | 18-65 years | Rs. 25 lakhs | Rs. 50 lakhs | Rs. 75 lakhs |
| Future Generali Flexi Online Term Plan | 10-65 years | 18-65 years | Rs. 50 lakhs |
| Bharti AXA Term Plan eProtect | 10-75 years | 18-65 years | Rs. 25 lakhs minimum |
| IDBI Federal iSurance Flexi Term Plan | 10-62 years | 18-60 years | Rs. 50 lakhs to Rs. 30 Crores |
| ICICI Prudential iProtect Smart | 18-60 years | 18-60 years | Rs. 50 lakhs to Rs. 1 Crore |
| Canara HSBC iSelect+ Term Plan | 5-62 years | 18-65 years | Rs. 15 lakhs to Rs. 3 Crores |
| Bajaj Allianz eTouch Lump sum | 18-65 years | 18-65 years | Rs. 50 lakhs minimum |
| Aegon Life iTerm Plan | 18-65 years | 18-65 years | Rs. 35 lakhs to Rs. 50 lakhs |
Disclaimer: The above information has been sourced from the official website of the respective insurance company. (last updated on 26-10-2020)
| Top Term Insurance Plan | Age at Entry | Sum Assured | Policy Term |
|---|---|---|---|
| ICICI Pru iProtect Smart | 18-65 years | Rs. 10 lakhs min, no such limit on max. amount | 5-40 years |
| Aegon iTerm Plan | 18-65 years | Rs. 25 lakhs min, no such limit on max. amount | 5-40 years |
| HDFC Click 2 Protect Plus | 18-60 years | Rs. 10 lakhs min, no such limit on max amount | 10-40 years |
| Max Life Term Insurance Plus | 18-60 years | Rs. 25 lakhs min Rs. 100 Cr max | 10-40 years |
| LIC’s e-Term Plan | 18-60 years | Rs. 50 lakhs min, no such limit on max. amount | 10-35 years |
Disclaimer: The above information has been sourced from the official website of the respective insurance company. (last updated on 26-10-2020)
In Simple Words,
It is advisable to have a nominee for your term insurance cover policy. Without a valid nominee, the purpose of having a term plan is invalid. In case there are changes in the details of your nominee, such as address and marital status, you should get the requested information updated with the insurance provider as well.
