LIC eTerm online term insurance plan – Review

LIC online term insurance plan e-TermFinally the much awaited LIC online term insurance plan has been launched by LIC few days back. LIC Online term insurance plan is named as LIC e-Term / LIC eTerm.  LIC is trusted for the longest time, but premiums do not come cheap compared to private insurance online term insurance plans. In this article, I would provide more details about LIC e-Term online term insurance plan, its features, negative points, how to buy LIC term insurance plan online and whether one should consider this online term insurance plan or not?

Features of LIC e-Term online term insurance plan


  • This is a pure term insurance plan
  • This can be purchased online where no agent is involved
  • Sum assured would be paid on death. This does not carry any maturity benefit.
  • Online term insurance plan is categorized into two. Aggregated category and non aggregated category. Non smokers have an option from Rs 25 Lakhs to Rs 49 Lakhs sum assured and > = Rs 50 lakhs sum assured. Non smokers category of Rs >= 50 Lakhs. The differential premium rate would apply for smoker and non smoker category.
  • The minimum sum assured is Rs 25 Lakhs for non smoking category and Rs 50 Lakhs for smoking category
  • Maximum Sum assured – No limit
  • Minimum age of entry – 18 years
  • Maximum age of entry – 60 years
  • Maximum age where policy ceases – 75 years
  • Minimum term: 10 years
  • Maximum term: 35 years
  • You can surrender the policy within  30 days if you are not satisfied with the policy (cooling-off period)
  • Mode of payment: Annual
  • Proposal for self only
  • Medical tests are a must

Also Read: How to pick-up best term insurance plans in India

How do the premiums of LIC online term plan compare with other term insurance plans?


a) LIC e-Term Vs Offline term insurance plan – Amulya Jeevan-II

If we compare Rs 50 Lakhs sum assured for 30 year term.

  • Smoker – Not much benefit
  • Non smoker – 30% to 40% less premium in online plan comparing to offline plan depending on the age of the insured

b) LIC e-Term Vs Private online term insurance plans

LIC e-Term online plan premiums are comparable to ICICI Pru life online plans. LIC online plan premiums are not cheap. For young age and age below 35 years of age, this is comparable to ICICI term insurance plans. However, beyond 35 years, LIC plans comes cheaper compared with ICICI plans. Now comparing them with other private insurance plans, LIC is definitely not cheaper. There are private insurance companies offering online term plans for lower premiums. Various other factors would play in deciding the premiums.

LIC e term Vs private insurance online term insurance plans

Source: Economictimes

How to buy LIC e-Term online term insurance plan?


  • Visit LIC Direct link
  • Click buy online
  • Select residential status.
  • Enter Sum Assured, Date of Birth, Mode, Smoker/Non-Smoker category Gender etc.
  • Premiums would be displayed
  • Fill relevant personal details
  • You would get a 9 digit access ID on your registered email ID or mobile number
  • Click proceed with this 9 digit access ID and generate the PDF copy
  • Review PDF copy and make changes (if any)
  • Proceed to make payment thru internet banking or Credit Card

Details you may need to enter during the process:

  • PAN number is must
  • Form 16 and ITR for last 3 years details need to be filled-in
  • Details of existing insurance plans
  • Data of family members and nominee details
  • Bank account details and MICR code
  • Medical tests are must for this online term insurance plan

Should you buy LIC e-Term online term insurance plan?


Buying insurance plan is an important decision to be taken in life as it protects us financially and also a long term decision. Let us review its positives, negative points and conclusion summary.

Positive points in LIC Online term insurance plan

  • LIC is trustworthy for the longest time
  • The claim settlement ratio is 97.3% in the last financial year. Other private insurance companies except for ICICI Pru life and HDFC Life, others have a low settlement ratio.
  • Non smokers benefit 30% to 40% of premiums comparing to offline LIC term insurance plan. Smokers may not benefit much from this plan.

Negative points

  • Proposal for self only. You can not buy for your wife’s life style or for any other member
  • Premiums are not cheap. They come in par with top private insurance companies
  • No specific riders applicable for this online plan
  • You need to undergo medical tests. Many private insurance companies offer online term plans where you need not undergo medical tests.

Also Read: Check latest Claim settlement ratio before taking insurance decisions

Some of the FAQ’s on LIC online term insurance plan


1) Can NRI buy LIC online term insurance plan

There is no clarity on the website and I called LIC to inquire about it.  As per them, NRI’s cannot buy this online plan. The reason could be is one need to undergo medical tests before issuing the policy and since NRI’s are not in India, they are not providing this to NRI’s.

2) Recently I have taken LIC Offline term insurance plan Amulya Jeevan-II and premium is very high. Can I switch to this plan?

No, you cannot switch to this plan. You may discontinue the existing plan and consider this online term insurance plan of LIC after going thru features and negative points. You may not get premium refund from your earlier offline term insurance plan if you can discontinue.

3) ICICI Pru life offers term insurance plan without medical tests and LIC online plan offers with the medical tests. Premiums looks almost  similar. Can we buy ICICI Pru term insurance plan?

I agree on this point. However LIC is more trustworthy compared to private insurance companies. Both have their owns pros and cons. Review them and consider the one which is suitable to you.

4) Banks are offering insurance for cheaper rates, how does this compare with LIC online term insurance plan?

Banks are offering health insurance plans and accidential insurance plans. They offer insurance plans with only few features and with a limited sum assured. Hence, both are not comparable.

5) LIC online plan shows higher premium if I take for 70 years maturity age compared to 65 years maturity, why is it so?

The longer term you take term insurance, the more riskier for insurance companies that too after 60 years of age. Hence, they would charge higher premiums for age beyond 60 years. I feel you would be financially independent after 65 years, hence considering term plan up to 65 years should be good enough.

6) I see there are no riders in LIC e-Term online policy. Is there any private insurance company offering riders?

Majority of the online term insurance plans does not offer riders. Some of the policies like ICICI I-Care provide accidental benefit riders but charge additional premiums.

7) What would be amount paid at maturity if i opt for LIC online term insurance plan?

This is pure term insurance plan without any maturity benefit. If you are looking for maturity benefits on term insurance plan, you can review plans like Max Newyork life insurance premium return term plan. However note that they charge high premiums.

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Suresh
LIC online term insurance plan eTerm

62 comments

  • SmartInvestor

    No Medical Test. Because it is one way. Nominee will not get any thing by any means. That is the reason these private banks are having huge profits and YoY growth.

  • Bablu nonia

    Is there any medical test in hdfc click 2 protect plan for
    Age – 28
    Sum Assured – 5000000
    Non smoker
    Term -;40
    And what would be the approx annual premium?
    Thanks.

  • Naren

    I am 44 years State Govt Servant getting annual package of 8-00 lakh and non-smoker. I intend to have one 15 years basic term insurance plan of sum assured Rs. 75 lakh. The premium offered by Max Life is Rs 12750/- and that by LIC Rs. 24400/-(online). Others are offering in between. Max Life, LIC and some others are suitable as per the brochure. I can’t decide which one to select. Max is offering lowest premium but I don’t know if they shut their business or get bankrupt in some years, what can I do or what steps can be taken. Alternatively LIC is Govt controlled but I don’t know if LIC will be fully privatised by Govt in near future. You have given lots of information but I need trust rating in terms of the criteria mentioned above before selection.
    Regards

  • abinash

    Hello Sir,
    I hav taken a policy jeevan anand for 25 yrs of 500000 sum assured.
    My age is 27yrs.the policy is just 1 year.
    Now i am thinking to discontinue jeevan anand and take a term plan and invest the surplus amount in banks rd or ppf hoping
    it will be good for both insurance and investment.
    Please guide whether i m going in right direction or continue with jeevan anand.
    Thanks

  • Nikhil

    Sursh ji,

    Is Accidental death cover included in this policy??

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