Term insurance is the most basic type of life insurance policy. It covers the risk of premature death and pays a benefit if the insured dies during the policy tenure. The policy, therefore, helps individuals plan for a financial corpus for their families in their absence.
Here are some salient features of term insurance plans –

  • These plans are offered for a long term period so that you can enjoy coverage till a longer age
  • Usually, only a death benefit is payable if the insured dies during the term of the plan
  • The premiums are very low since only death risk is covered by the plan
  • The plan allows you to opt for very high sum assured levels for availing optimal coverage
  • Riders are available with the policy to enable you to enhance your coverage. Under many plans, riders also come inbuilt in the coverage benefits while all term plans allow optional riders
  • The death benefit is usually paid in a lump sum under most plans. However, there are some plans which pay a death benefit in monthly or annual instalments to create a source of income for the family.

Benefits of term insurance plans:

Here are some of the most obvious benefits of a term insurance plan –

  • Since the premiums are low, term plans allow you to afford high coverage levels which is suitable for creating a sufficient financial corpus for your family
  • When you know that the plan would pay the benefit to your family in your absence, you can create financial security for them in case of your premature death
  • Term plans give you peace of mind knowing that your family would be financially protected in your absence
  • Premiums are low and are, therefore, quite affordable.

How to choose the best term plan?

When it comes to choosing the best term plan, the choice is entirely relative. One plan might be the best for one individual and another plan for another individual. To choose the best term insurance plan, the following factors should be kept in mind:

  1. The sum assured offered – usually, most term plans offer unlimited coverage levels. Such plans are best because you can choose the coverage that you need without any limitations.
  2. The coverage benefits – all term plans cover premature deaths. However, there are some plans which have inbuilt riders too. Such plans are better because they offer a wider scope of coverage.
  3. Payment of benefits – Return of premium term plans are also available which pay back the premiums if you survive the policy tenure. So, if you are looking for term plans with a maturity benefit, you can choose the return of premium plans.
  4. Type of coverage required – There are term plans which allow you to increase the sum assured on marriage and childbirth while there are others where the sum assured does not change throughout the policy tenure. There are loan protection term plans too where the sum assured is linked to your loan liability and it reduces every year. So, depending on your coverage requirement, you can choose a level term plan, increasing term plan or a decreasing term plan
  5. Riders offered – look for the riders offered by the plan. The plan should offer a range of rider options so that you can choose the most suitable riders with your basic plan
  6. The premium charged – the rate of premium should be compared. Term plans which offer the best coverage benefits at the lowest premium rates would be the best plans
  7. Premium discounts – you might get premium discounts under term insurance plans. these discounts help in lowering your premium rate and so you should find the plan with the best discount rates
  8. Coverage duration – the best term insurance plan should offer you the longest possible coverage duration so that you can enjoy coverage for a longer period
  9. Claim settlement ratio of the insurance company – the last factor which you should check when comparing term insurance plans is the insurer’s claim settlement ratio. This ratio shows the percentage of claims settled by the insurance company in a year. Higher the ratio better would be the term plan as it would increase the chances of your claims getting settled

Top #4 Things to remember when buying term plans:

When you are buying a term insurance plan for yourself, here are some things which you should remember –

  1. Optimal Sum Assured:
    Always opt for an optimal level of sum assured which would be sufficient to meet your family’s needs in your absence. The ideal coverage level should be at least 10 to 12 times your annual income. If you cannot afford a high sum assured presently, start small. You can, then, gradually, invest in more term insurance plans for increasing the coverage.
  2. Policy Tenure:
    Choose an appropriate tenure for coverage. Opting for the maximum possible coverage duration may or may not be the wise decision at all points of time.
  3. Annual Premium:
    Try and pay the premiums annually to avoid unnecessary charges which are levied when premiums are paid quarterly, monthly or half-yearly even if there are options for the same.
  4. Appropriate coverage with riders:
    Choose the required riders even though they incur an additional premium. Riders enhance your coverage and help you get better benefits from the plan.

Best term insurance plans in India:

Here is a comparative list of Top #10 best term insurance plans in India –

Name of the plan Entry age Sum assured Term
TATA AIA Life Sampoorna Raksha 18-70 years INR 50 lakhs onwards Minimum – 10 years

Maximum – up to 85 years or 100 years of age

ICICI Pru iProtect Smart 18-65 years Depends on the premium amount paid Minimum – 5 years

Maximum – up to 85 years or 99 years of age

Max Life Smart Term Plan 18-60 years INR 10 lakhs onwards 10-50 years
DHFL Pramerica Flexi e-Term Plan 18-65 years INR 25 lakhs onwards Minimum – 10 years

Maximum – up to 75 years of age

HDFC Life Click 2 Protect 3D Plus 18-65 years INR 10,000 onwards Minimum – 5 years

Maximum – whole life

AEGON Life iTerm Plus Insurance Plan 18-65 years INR 25 lakhs onwards Minimum – 5 years

Maximum – 62 years

Bharti AXA Life Flexi Term Plan 18-65 years INR 10 lakhs onwards Either – 10,15,20 or 25 years or coverage till 60,65,70,75,80 or 85 years of age
Kotak e-Term Plan 18-65 years INR 25 lakhs onwards Minimum – 5 years

Maximum – 40 years or up to 75 years of age

LIC’s Anmol Jeevan II 18-55 years INR 6 lakhs to INR 24 lakhs 5-25 years
PNB MetLife Mera Term Plan 18-65 years INR 10 lakhs to INR 500 crores Up to 99 years of age

Brief glance at the Top 10 term plans:

Here is a brief look into the best term insurance plans listed above –

  1. TATA AIA Sampoorna Raksha

    This is a pure term plan which offers coverage up to 85 years. You can even opt for whole life coverage under the plan. The plan’s features are as follows –

    1. There are four death benefit options and you can choose any option as per your coverage requirements. The options include the following –
      1. Option 1 –
        The sum assured is paid in a lump sum on death
      2. Option 2 –
        The sum assured is paid in a lump sum on death + monthly incomes are paid @1% of the sum assured for 10 years
      3. Option 3 –
        The sum assured is increased by 5% every year and the increased sum assured is paid on death
      4. Option 4 –
        The sum assured is increased by 5% every year and the increased sum assured is paid on death + monthly incomes are paid @1% of the sum assured for 10 years
    2. Premiums can be paid regularly or for a limited tenure
  1. ICICI Pru iProtect Smart

    This is a comprehensive term insurance plan which allows a lot of coverage options to choose from. You can, therefore, customise the plan as per your requirements. The features of the plan are as follows –

    1. There are four coverage options to choose from. They are as follows
      1. Life Option–
        Under this option, the sum assured is paid in case of death or terminal illness + premiums are waived off if you are disabled during the term
      2. Life Plus Option –
        Under this option, the sum assured is paid in case of death or terminal illness + premiums are waived off if you are disabled during the term + an additional sum assured is paid in case of accidental death
      3. Life and Health Option-
        Under this option, the sum assured is paid in case of death or terminal illness + premiums are waived off if you are disabled during the term + 34 critical illnesses are covered and if the insured suffers from a covered illness, a lump sum benefit is paid
      4. All-in-one –
        Under this option, the sum assured is paid in case of death or terminal illness + premiums are waived off if you are disabled during the term + an additional sum assured is paid in case of accidental death + 34 critical illnesses are covered and if the insured suffers from a covered illness, a lump sum benefit is paid.
    2. The benefit can be received in four ways – in a lump sum, in monthly incomes, in increasing monthly incomes or in a combination of lump sum and monthly incomes
    3. The coverage can be taken for whole life
  1. Max Life Smart Term Plan

    This is an online term insurance plan offered by Max Life Insurance. The plan’s features include the following –

    1. There are seven death benefit options which are as follows
      1. Life cover Option–
        Under this option, the sum assured is paid on death
      2. Income protector Option–
        Under this option, the monthly income is paid for 10,15 or 20 years
      3. Income + Inflation Protector Option–
        Under this option, an increasing amount of monthly income is paid for 10, 15 or 20 years. The income increases by 10% per annum
      4. Life cover + Income Option–
        Under this option, the sum assured is paid on death + monthly incomes are paid @0.4% of the sum assured for 10 years
      5. Life cover + increasing income Option-
        Under this option, the sum assured is paid on death + increasing monthly incomes are paid @0.4% of the sum assured for 10 years. The income increases by 10% per annum
      6. Increasing cover Option–
        Under this option, the sum assured increases by 5% every year
      7. Reducing cover Option–
        Under this option, the sum assured reduces by 5% every year
    2. There is an accelerated critical illness (ACI) cover which covers 40 illnesses with 2 options to choose from
      1. Level ACI benefit where a fixed amount of money (ACI sum assured) would be payable to the insured on diagnosis of any of the listed critical illness for the entire policy tenure
      2. Increasing ACI benefit where the ACI sum assured is paid on diagnosis of any of the listed critical illnesses and the coverage increases at a simple interest rate of 5% every year and is paid out for the entire policy tenure.
    3. The premiums are refunded on maturity if you choose so.
  1. DHFL Pramerica Flexi e-Term Plan

    DHFL Pramerica’s Flexi e-Term plan is true to its name as it offers flexible benefits to policyholders. The plan’s salient features include the following –

    1. There are five coverage options under the plan. These include the following –
      1. Life cover Option-
        Under this option, the sum assured is paid on death and the policy is terminated
      2. Life cover + Terminal Illness Option–
        Under this option, the sum assured is paid on death or terminal illness, whichever is earlier and the policy terminates
      3. Life cover + Terminal Illness + Accidental Death Benefit Option-
        Under this option, the sum assured is paid on death or terminal illness + additional sum assured is paid in case of accidental death
      4. Life cover + Terminal Illness + Accidental Death Benefit + Critical Illness Option-
        Under this option, the sum assured is paid on death or terminal illness, whichever is earlier + additional sum assured is paid in case of accidental death + sum assured is paid on diagnosis of covered critical illnesses.
    2. There are flexible choices in availing the death benefit too. These choices include the following –
      1. Lump-sum, where the sum assured is paid in a lump sum
      2. Level monthly income, where the sum assured is paid in monthly incomes over 5-15 years
      3. Increasing monthly income, where the sum assured is paid in monthly incomes over 5-15 years. The income increases @10% every year
    3. The sum assured can be increased at important specified life events.
  1. HDFC Life Click2Protect 3D Plus

    This is a very popular term plan offered by HDFC Life. The plan allows you to increase your sum assured either at important milestones in your life or by paying top-ups. The key features are as follows –

    1. There are nine coverage options which are as follows –
      1. Life Option-
        Under this option, the sum assured is paid on death or terminal illness
      2. 3D Life Option–
        Under this option, the sum assured is paid on death or terminal illness + premiums are waived in case of critical illness
      3. Extra Life Option-
        Under this option, the sum assured is paid on death or terminal illness + additional sum assured is paid on accidental death
      4. Income Option-
        Under this option, the sum assured is paid on death or terminal illness + monthly incomes are paid to the nominee for a specified duration.
      5. Extra Life Income Option-
        Under this option, the sum assured is paid on death or terminal illness + monthly incomes are paid to the nominee for a specified duration + additional sum assured is paid on accidental death.
      6. Income Replacement Option-
        Under this option, a lump sum benefit is paid on death or terminal illness + monthly incomes are paid for the remaining policy term.
      7. Return of Premium Option-
        Under this option, the sum assured is paid on death or terminal illness + if the plan matures, the premiums paid are refunded.
      8. Lifelong Protection Option-
        Under this option, the sum assured is paid on death or terminal illness.
      9. 3D Lifelong Protection Option-
        Under this option, the sum assured is paid on death or terminal illness + premiums are waived in case of critical illness.
    2. There is an inbuilt Accidental Total Permanent Disability rider under all plan options. This rider waives the premiums if you suffer from an accidental disability
  1. AEGON Life iTerm Plus Insurance Plan

    The plan is a comprehensive term insurance plan which provides various benefits to the policyholder. The features are as follows –

    1. There are four coverage options which include the following –
      1. Life Option-
        Under this option, the sum assured is paid in case of death + inbuilt accidental death benefit rider
      2. Life Plus Option-–
        Under this option, the sum assured is paid in case of death + inbuilt accidental death benefit rider + inbuilt terminal illness benefit + waiver of premium in case of accidental death or disability
      3. Life & Health Option-
        Under this option, the sum assured is paid in case of death + inbuilt terminal illness benefit + coverage for 10 critical illnesses
      4. Life & Health Plus Option-
        Under this option, the sum assured is paid in case of death + inbuilt terminal illness benefit + coverage for 36 critical illnesses.
    2. The coverage can be increased at important and specified life stages.
  1. Bharti AXA Life Flexi Term Plan

    This is a flexible term insurance plan which has the following benefits –

    1. The policy proceeds can be taken in a lump sum, in monthly instalments or in a combination of both
    2. You can opt for critical illness cover which comes in three variants covering 9, 15 and 34 illnesses respectively
    3. Coverage is available for up to 85 years of age.
  1. Kotak e-Term Plan

    This is an online term insurance plan which has the following coverage features and benefits –

    1. There are three coverage benefits which you can choose from. The benefits include the following
      1. Life Option-
        Under this option, the sum assured is paid on death
      2. Life Plus Option–
        Under this option, the sum assured is paid on death + inbuilt accidental death benefit
      3. Life Secure Option-
        Under this option, the sum assured is paid on death + premiums are waived in case of total and permanent disability
    2. There are three pay-out options which are as follows –
      1. Immediate pay-out in which sum assured is paid in a lump sum
      2. Level recurring pay-out where 10% sum assured is paid in a lump sum and the remaining is paid in annual instalments for 15 years
      3. Increasing recurring pay-out where 10% sum assured is paid in a lump sum and increasing annual pay-outs are paid over the next 15 years
    3. Sum assured can be increased on marriage or childbirth.
  1. LIC’s Anmol Jeevan II

    LIC’s Anmol Jeevan II is a simple term insurance plan which offers the following features –

    1. The premiums are low and affordable
    2. The sum assured is paid in case of death of the insured during the term of the policy.
  1. PNB MetLife Mera Term Plan

    This plan has affordable coverage and different pay-out options which form its feature. Let’s see the features of the plan –

    1. There are four pay-out options to choose from. These are as follows –
      1. Immediate Lumpsum Option–
        Under this option, you can choose to get lump sum payment on death
      2. 50% Lumpsum + 50% instalments Option –
        Under this option, you can choose 50% sum assured as lump sum payment and the remaining paid in monthly instalments for 10 years
      3. 50% Lumpsum + 50% increasing instalments Option-
        Under this option, you can choose 50% sum assured as a lump sum payment and the remaining is then paid in increasing monthly instalments for 10 years
      4. 50% Lumpsum + 50% instalments till 21 Option-
        Under this option, you can choose 50% sum assured as a lump sum payment and the remaining is paid in monthly instalments till your child attains 21 years of age
    2. Coverage is available till 99 years of age
    3. Lifestage benefit can be selected wherein the sum assured would increase on marriage and on the birth of two children
    4. Joint life cover can be taken for covering a couple under the same plan

Claim settlement ratios of life insurance companies:

As stated earlier, the claim settlement ratio is an important parameter when choosing the best term insurance plan. The ratio depicts the life insurer’s claim settlement history and tells you how likely your claim settlement would be. A high claim settlement ratio is favourable as it shows that the insurance company settles most of its claims.

Here are the claim settlement ratios, as published by the Insurance Regulatory and Development Authority of India (IRDAI) for the financial year 2017-18 –

Name of the company Claim Settlement Ratio
Life Insurance Corporation of India 98.04%
HDFC Life Insurance Company Limited 97.80%
Max Life Insurance Company Limited 98.26%
ICICI Prudential Life Insurance Company Limited 97.88%
Kotak Mahindra Life Insurance Company Limited 93.72%
Aditya Birla SunLife Insurance Company Limited 96.38%
TATA AIA Life Insurance Company Limited 98%
SBI Life Insurance Company Limited 96.76%
Exide Life Insurance Company Limited 96.81%
Bajaj Allianz Life Insurance Company Limited 92.04%
PNB MetLife India Insurance Company Limited 91.12%
Reliance Nippon Life Insurance Company Limited 95.17%
Aviva Life Insurance Company Limited 94.45%
Sahara India Life Insurance Company Limited 82.74%
Shriram Life Insurance Company Limited 80.23%
Bharti AXA Life Insurance Company Limited 96.85%
Future Generali India Life Insurance Company Limited 93.11%
IDBI Federal Life Insurance Company Limited 91.99%
Canara HSBC OBC Life Insurance Company Limited 95.22%
Aegon Life Insurance Company Limited 95.67%
DHFL Pramerica Life Insurance Company Limited 96.62%
Star Union Dai-ichi Life Insurance Company Limited 92.26%
IndiaFirst Life Insurance Company Limited 89.83%
Edelweiss Tokio Life Insurance Company Limited 95.25%

Buying term insurance plans:

Nowadays, most term insurance plans can be bought online as the online medium is quick and convenient. Turtlemint is also an online medium which allows you to buy the best term insurance plans for your needs. Turtlemint is tied up with all leading life insurance companies and therefore gives you a choice to buy from the best term insurance plans in the market. Any of the plans listed above can be bought easily from Turtlemint’s website through the following simple steps –

  1. Visit Turtlemint at https://www.turtlemint.com/
  2. Choose ‘Life’ and then ‘Term Life Plans’
  3. Provide your details like your gender, age, annual income, smoking history, etc. Based on these details, you can see the different term insurance plans and the optimal coverage level
  4. Compare the available plans on their coverage and premium parameters and choose the best plan which suits your coverage requirements
  5. Then you would simply have to pay the term insurance premium online and the policy would be issued.

The whole process takes minutes and you can enjoy coverage at the earliest. Turtlemint also helps you with your claims in case you face any contingency. Thus, Turtlemint is a one-stop solution for your insurance needs from where you can buy term insurance plans and also get claim assistance. So, choose the best term insurance plan for yourself and get covered.


FAQ’s

Term insurance plans can be surrendered. However, if you surrender the plan, you would not get any surrender value.


Yes, premiums can be paid monthly, annually, half-yearly or quarterly. You can choose to pay the premium in any mode that you like. However, in some modes, there might be an additional charge for non-annual modes.


Yes, a grace period is allowed if you miss the premium payment within the due date. Usually, the grace period lasts for 30 days for annual, quarterly or half-yearly premiums. For monthly premiums, however, the grace period is usually 15 days.


Yes, if the plan allows optional riders, you would have to pay an additional premium for each rider that you have selected.


The premium that you pay for the plan would be allowed as a deduction under Section 80C up to a maximum of INR 1.5 lakhs. The death benefit received would also be tax-free in your hands under Section 10 (10D) of the Income Tax Act.