Should I take 1 Crore Term Insurance or 2 Crore Term Insurance?. I could see these kind of comments on our blog and on various insurance forums and Facebook Groups. It looks like a magical number for everyone. There are several insurance companies offering low premiums and rebates on Rs 1 Crore and Rs 2 Crore term insurance plans. What is this 1 Crore Term Plan all about? Which are the Best 1 Crore Term Insurance Plans that are available in the Indian insurance market that are coming with lower premiums? Let’s review these 1 Crore Term Insurance Policies.
Also Read: Best Health Insurance Plans for Your Family
What is Term Insurance Plan?
If you are aware about the Term insurance plan, skip this section.
Term insurance Plan is a simple insurance plan where if the insured dies, their family / nominee would get the sum assured. There is no maturity amount in the term insurance plan. These are insurance plans that have risk coverage only. One would not get any money back at maturity.
As per guidelines from IRDA, after 3 years from the date of policy, a claim cannot be rejected citing any reason. Hence, the claim settlement ratio is no more a major criteria in deciding the best term insurance plan. However, it still needs to be considered as one of the points while buying a term insurance plan.
Let us quickly look at why one need to consider term insurance plans its pros and cons.
Do we need 1 Crore Term Insurance Plans?
It is not a magic number. Individuals are thinking that in their absence, their family can survive for 10-15 years with that 1 Crore Term plan. Does 1 Crore insurance would be sufficient? This would depend on your age and your expenses and any abnormal expenses which you might need like children education or daughter’s marriage. Let us take an example to understand this quickly.
Mr.Mahesh is 35 years and want to take 1 Crore term insurance policy. He has 1 son and 1 daughter (1 and 4 years respectively). His monthly expenses are at Rs 50,000 and he might need Rs 25 Lakhs educational expenses for children (based on the current estimate) and another Rs 25 Lakhs for a daughter’s marriage (based on the current estimate). In the absence of Mr.Mahesh, their family should be able to survive for next 10-15 years, i.e. they would need Rs 6 lakhs per year or Rs 60 Lakhs to Rs 90 lakhs for next 10-15 years. If we add education and daughter’s marriage expenses, it would come to Rs 1.1 Crore to Rs 1.4 Crores. These costs are based on current cost and reality it could be higher even if we consider returns by depositing this in FD Vs inflation for such costs.
What are the benefits of 1 Crore or 2 Crore Term Insurance Plans?
Here are a few benefits
1) You are considering a simple thumb rule amount instead of taking the insurance plan in some lakhs of rupees.
2) This is easy to remember from your family side too.
3) Many insurance companies offer low premiums for term insurance for 1 Crore or Rs 2 Crore plans.
4) There are special rebates / discounts if we take 1 Crore term insurance plan vs term plan which is less than 1 Crore.
However, one should do simple math and arrive at whether their need would suffice with Rs 1 Crore or Rs 2 Crore term plan. Don’t run around just for Best Term Insurance Plan for 1 Crore alone.
How we filtered Best 1 Crore Term Insurance Plans to consider in 2019-2020?
There are various parameters that can be considered while picking up best 1 Crore term insurance plan in India. However, I have considered below key parameters while picking these plans.
1) Insurance Claim Settlement Ratio (CSR): CSR is one of the criteria considered to filter a good insurance company. As of 2017-2018, there are 68 insurance companies which are registered in India, out of which only 24 are in life insurance business. Out of them 10 companies have declared claim settlement ratio of >= 95%. CSR is an insurance claims settled over the total insurance claims received by the insurance company during the year. Lower CSR means, the company is honoring lower claims than what it received and rejecting some claims. In future your family could be victim out of such rejected claims. I have filtered insurance companies that have a high claim settlement ratio of 95% to 100%.
2) Insurance Company Reputation: No one can tell you how good is an insurance company in India. The higher the duration of the insurance company registered or existence, it is better. Hence, we have filtered Insurance companies that have a good operating history of more than 5 years.
3) Additional Features in Term insurance plan: What about a good insurance company that do not offer useful features or benefits? No one would really want to opt for that. I have filtered Term insurance plan which have basic features + additional features that would be helpful for individuals who are planning to take term plans.
4) Plans with Low Premium: While Premium is not the only criteria in selecting an insurance plan; we have given preference to 1 Crore term insurance plans which are being offered at low premiums with more features.
One should do an insurance plan comparison before taking up a particular plan.
Best 1 Crore Term Insurance Plans in 2019-2020
Here are the Top and Best 1 Crore Term Insurance Plans for 2019-2020. We are giving major features of these term insurance plans.
Top#1 – Max Life Term Insurance Plan Plus
Max Life Term Insurance Plan Plus comes with various options in its term plan.
Any individual who is between 18 to 60 years can take this plan. However, the maximum maturity age should not cross 70 years.
The policy is issued for 10 to 50 years.
The policy is issued for sum assured of Rs 25 Lakhs to Rs 100 Crores.
One can save 30% of premium if they opted for Limited Premium payment option available where you can pay the premium for a limited period, however, enjoy term insurance plan for the entire tenure of the plan.
Comprehensive Accident Benefit Rider available in this plan.
This plan is available in 3 coverage options like 1) Basic Life Cover Plan 2) Basic Life Cover+Monthly cover plan 3) Basic Term Plan Cover + Increasing Monthly Income Plan
The claim settlement ratio of FY 2017-18 is 98.26% (announced in Jan-2019), which is highest among all insurance companies.
It’s Basic Premium is approx. Rs 7,900 per annum (Excl taxes) for a 30 year non smoker for a 30 year policy for 1 Crore sum assured for basic life cover.
Its Basic Premium is approx. Rs 10,500 per annum (Excl taxes) for a 30 year non smoker for a 30 year policy for 1 Crore sum assured for Basic Life Cover + monthly income option.
Its Basic Premium is approx. Rs 11,500 per annum (Excl taxes) for a 30 year non smoker for a 30 year policy for 1 Crore sum assured for Basic Life Cover + increasing monthly income option.
Max Life Term Insurance plan is one of the best 1 Crore Term Insurance Plan for 2019-2020 which has high claim settlement ratio and comes with low premium.
Top#2 – Aegon Life – iTerm Plus Insurance Plan
Aegon Life iTerm Plus Term Insurance Plan comes with unique features.
It comes with 4 plan options 1) Life plan 2) Life Plan Plus 3) Life & Health Plan and 4) Life and Health Plan plus
Any individual who is between 18 to 65 years can take this plan. However, the maximum maturity age should not cross 80 years.
The policy is issued between 5 to 62 years.
The policy is issued for sum assured of Rs 25 Lakhs and with no maximum limit.
Comprehensive Accident Benefit Rider and Critical illness benefit riders available in this plan.
The claim settlement ratio of FY 2017-18 is 95% (announced in Jan-2019).
It’s Basic Premium is approx. Rs 7,250 per annum (Excl taxes) for a 30 year non smoker for a 30 year policy for 1 Crore sum assured for basic life cover.
It’s Basic Premium is approx. Rs 8,312 per annum (Excl taxes) for a 30 year non smoker for a 30 year policy for 1 Crore sum assured for basic life cover + Accident dealth benefit of Rs 20 Lakhs.
It’s Basic Premium is approx. Rs 9,012 per annum (Excl taxes) for a 30 year non smoker for a 30 year policy for 1 Crore sum assured for basic life cover + Accident dealth benefit of Rs 20 Lakhs + disability rider of Rs 20 Lakhs.
Aegon Life is one of the good 1 Crore term insurance plan for 2019-2020.
Top#3 – ICICI iProtect Smart Term Insurance Plan
Here are the key features of ICICI iProtect Smart Term Plan.
Any individual who is between 18 to 65 years can take this plan. However, the maximum maturity age should not cross 99 years.
The policy is issued for the tenure of 5 to 40 years.
There is no maximum limit on the sum assured.
There is an optional rider that it pays if diagnosed by any of the 34 Critical Illnesses.
It comes with 4 levels of protection 1) Life 2) Life Plus 3) Life and Health and 4) All in one.
The claim settlement ratio of FY 2017-18 is 97.88% that was announced in Jan-2019.
The premium is approx. Rs 7,800 per annum for a 30 year non smoker for a 30 year policy for Rs 1 Crore sum assured. The accident death cover would cost Rs 2,800 additional premium for Rs 50 Lakhs Coverage and Critical illness cover cost Rs 3,800 for Rs 10 Lakhs coverage. These 2 are optional riders which you may consider based on your requirement.
I feel ICICI iProtect Term plan is one of the best 1 Crore term policy that has several unique features and comes with low premiums and has a high claim settlement ratio.
Top#4 – HDFC Click 2 Protect Plus Term Insurance Plan
Below are the features of HDFC Click 2 Protect Plus Term plan.
Any individual who is between 18 to 65 years can take this plan. However, the maximum maturity age should not cross 85 years.
The policy is issued for the tenure of 5 to 40 years.
The policy is issued for sum assured of Rs 10 Lakhs with no maximum limit.
There are various term plan options like Life Option, 3D Life Option, Extra Life Option, Life Long Protection Option, 3D Life long protection, Return of Premium Option etc. available in this plan.
The claim settlement ratio of FY 2017-18 is 97.8% as announced in Jan-2019.
The Basic Premium is approx. Rs 9,800 (Excl taxes) per annum for a 30 year non smoker for a 30 year policy for Rs 1 Crore sum assured (Lumpsum payout option).
If you take 3D Life that covers waiver of premiums in case of critical illnesses or premium waiver in case of permanent disability, the premium works out to be Rs 10,200 for similar details.
This HDFC Life Click 2 Protect Term plan has several riders which make this as a unique term insurance plan for 2019-2020.
Top#5 – LIC Tech Term Insurance Plan
LIC is trusted brand in the insurance segment in India that has been catering to insurance for several decades. LIC offers Tech Term Insurance Plan that is online which is considered as best term plan. lic term insurance 1 Crore comes with some unique features.
Any individual who is between 18 to 65 years can take this plan. However, the maximum maturity age should not cross 75 years. Risk coverage is there upto 80 years of age
The policy is issued for 10 to 10 years.
The policy is issued for a sum assured of Rs 50 Lakhs with no maximum limit.
Accidental death benefit rider is available in this plan which is optional, but comes with additional premium.
The claim settlement ratio of FY 2017-18 is 98.04% that is announced in Jan-2019.
The premiums are little high in LIC. If you take LIC Tech Term Insurance plan for Rs 1 Crore and have opted for regular annual premium, in a simple sum assured, the premium works out to be Rs 5,368 for 20 years individual and for the 20 year policy term. It would be Rs 7,216 for 30 years individual and Rs 13,770 for 40 years individual. No discounts applied here. You can check pros and cons of LIC Term Insurance Plan.
Readers, have you considered any of these 1 Crore term insurance policies? What are your experiences with your insurance company?
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Best 1 Crore Term Insurance Plans in 2019-2020
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