Best Term Insurance Plans in India

Best Term Insurance Plans in IndiaBest Term Insurance Plans in India

Term Insurance Plans in India are best as they come with high risk coverage and low premiums and in case of unfortunate death of the life insured, the nominee would get sum assured. However identifying best term insurance plans in India may be difficult as your insurance agent may cheat you by just looking at his commissions and do not worry about its suitability for you. This article is based on request from Vikas and Seetharaman who requested on “Suggest-a-topic” to write about Best Term insurance plans in India.

Identification of best term insurance plans in India

Now the tricky part is about identifying the good term insurance plans in India. There are a few parameters which we have taken to identify them.

1) Settlement ratio: Settlement ratio plays a key role in identifying a good term insurance plan. Settlement ratio is nothing but the claims settled by an insurance company against the total settlements received. The higher settlement ratio is good for the company as claim rejection chances are very less from such insurance companies.

2) Enhanced Features: Though every term insurance program would possess its own features, any enhanced and additional features would be helpful for individuals looking for insurance.

3) Customer service: One more key point which I felt is to look for a term insurance plan where customer service of such insurance company is good. There is no point in choosing a term insurance and your family struggling to bring the claim accepted due to delay or poor response from the insurance company.

Also read: How to choose best term insurance plan in India

Best Term Insurance Plans in India

1) LIC Amulya Jeevan Term Insurance Plan: This is pure offline term insurance plan from LIC. Below are the features of this plan:

  • The claim settlement ratio of this company for FY 2011-12 is 97.4%
  • Sum assured would be paid to nominee in case of death of the life insured. No maturity benefit or survival benefit. No loans can be taken from such plans.
  • Minimum age : 18 years and Max is 60 years. Maximum age at maturity should be 70 years
  • Policy is available for 5 to 35 year term
  • Minimum sum assured: ₹ 25 Lakhs and Max Sum assured – No limit
  • Exclusions: In case of suicide committed by insured before 1 year, no claim would be paid
  • Premium for ₹ 1 Crore sum assured for a 30 year individual for the 30 year policy term: ₹ 33,600 per annum

Though the premium looks high, I feel this is one of the best term insurance plans in India which one should consider.

2) ICICI I-Care Term Insurance Plan: This is a pure term insurance plan from ICICI which is available to buy online. Below are the features of this plan:

  • The claim settlement ratio of this company for FY 2011-12 is 96.5%
  • Sum assured would be paid to nominee in case of demise of the life insured. No maturity benefit or survival benefit. No loans can be taken from such plans.
  • I-Care option-II available with accidental death benefit feature equal to sum assured for maximum of ₹ 50L with small extra premium. Means if you are taking ₹ 50 L term insurance with accidental death benefit feature, your total sum assured would be ₹ 1 Crore (₹ 50 L + ₹ 50 L).
  • Minimum age : 18 years and Max is 65 years. Maximum age at maturity should be 75 years
  • Policy is available for 5 to 30 year term
  • Minimum sum assured: ₹ 10 Lakhs and Max Sum assured for 50 year individual is ₹ 1.5 Crore and 65 year individual is ₹ 70 Lakhs
  • Exclusions: In case of suicide committed by insured before 1 year, no claim would be paid
  • Premium for ₹ 1 Crore sum assured for a 30 year individual for the 30 year policy term: I-care ₹ 12,360 and with accidental death benefit feature it would be ₹ 15,281

I feel this is one of the good term insurance plan in India which comes with an accidental death benefit rider where you can get the additional sum assured of ₹ 50 Lakhs with small additional premium.

Also read: Best Mediclaim Policy in India

3) HDFC Click-2-Protect Term Insurance Plan: This is pure online term insurance plan from HDFC. Below are the features of this plan:

  • The claim settlement ratio of this company for FY 2011-12 is 96.2%
  • Sum assured would be paid to nominee in case of demise of the life insured. No maturity benefit or survival benefit. No loans can be taken from such plans.
  • Minimum age : 18 years and Max is 55 years. Maximum age at maturity should be 65 years
  • Policy is available for 10 to 30 year term
  • Minimum sum assured: ₹ 10 Lakhs and Max Sum assured – 10 Crores
  • Low premiums for tobacco users
  • Premium for ₹ 1 Crore sum assured for a 30 year individual for the 30 year policy term: ₹ 10,200
  • I personally had a bad experience in reaching customer support for more than 45 days to consider this plan as I want to take some additional benefits which are available only offline. Few readers on this blog expressed that customer support is good for this insurance company.

If customer support is improved, no doubt this could be the best term insurance plan in India with high settlement ratio and low premium.

4) SBI Smart Shield Term Insurance Plan: This is pure offline term insurance plan from SBI Life. Below are the features of this plan:

  • The claim settlement ratio of this company for FY 2011-12 is 95.5%
  • Sum assured would be paid to nominee in case of death of the life insured. No maturity benefit or survival benefit. No loans can be taken from such plans.
  • Minimum age : 18 years and Max is 65 years. Maximum age at maturity should be 70 years
  • Policy is available for 5 to 30 year term
  • Minimum sum assured: ₹ 25 Lakhs and Max Sum assured – No limit
  • Premium for ₹ 1 Crore sum assured for a 30 year individual for the 30 year policy term: ₹ 11,925
  • Accident death rider, permanent disability riders are discontinued w.e.f. 1-Oct-2013.

5) Kotak e-Preferred Term Insurance Plan: This is online term insurance plan from Kotak life. Below are the features of this plan:

  • The claim settlement ratio of this company for FY 2011-12 is 92.1%
  • Sum assured would be paid to nominee in case of demise of the life insured. No maturity benefit or survival benefit. No loans can be taken from such plans.
  • Minimum age : 18 years and Max is 65 years. Maximum age at maturity should be 70 years
  • Policy is available for 5 to 30 year term
  • Minimum sum assured: ₹ 25 Lakhs and Max Sum assured – No limit
  • Premium for ₹ 1 Crore sum assured for a 30 year individual for the 30 year policy term: ₹ 12,921
  • Covers tobacco users with low premium
  • This policy available with step-up option and step-down option
  • Step-up option: When an individual is married or brought first house, sum assured can be increased by 50% with additional premiums. In case of birth of a child or during the policy anniversary of 1/3/5 years, 25% sum assured can be enhanced with additional premium. The additional premium payable would be 3% of the basic premium (before 15 years from policy date) and 5% of the basic premium (after 15 years from policy date).
  • Step-down option: Similarly in case you feel you do not need high sum insured, you can reduce it with step-down option with some terms and conditions.
  • Step-up and step-down option is a unique feature of Kotak e-Preferred Term insurance plan which is not available in major term insurance plans. These extra features make this as best term insurance plan in India comparing to others.
  • Kotak website indicates that critical illness riders are available. However all major companies have discontinued these riders w.e.f. 1-Oct-2013 as per IRDA guidelines, hence I am thinking that the info available on Kotak website is yet to be updated. The website still shows that these features are available.

Also read: Premium return plan from Max Newyork Life insurance

6) Birla Sun Life Protector Plus Term Insurance Plan: This is pure offline term insurance plan from LIC. Below are the features of this plan:

  • The claim settlement ratio of this company for FY 2011-12 is 90.9%
  • Sum assured would be paid to nominee in case of demise of the life insured. No maturity benefit or survival benefit. No loans can be taken from such plans.
  • Minimum age : 18 years and Max is 65 years. Maximum age at maturity should be 75 years
  • Policy is available for 5 to 30 year term
  • Minimum sum assured: ₹ 50 Lakhs and Max Sum assured – No limit
  • Premium for ₹ 1 Crore sum assured for a 30 year individual for the 30 year policy term: ₹ 15,650

Below is the comparison chart of these Best Term Insurance Plans in India

Best Term insurance plans in India-Features

*Claim settlement ratio is at insurance company level and not for specific policy.

Conclusion: Based on your individual requirement, you can choose one of these good term insurance plan among the top ones which are listed above.

If you enjoyed this article, share it with your friends and colleagues on Facebook and Twitter.

Suresh

Best Term Insurance Plans in India

Suresh KP

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70 comments

  1. sir i m dr ashok gaikwad from maharashtra gen surgeon ,age 55 want to have a health insurance policy i m having hypertension ,which policy i have to purchase ,i m intrested in lic, sbi ,bajaj ,and requirement is up to 5to 7 lacs for myself only ,which will be better i m reading somany artical for this but confused ,or any other you suggest ….dr ashok gaikwad

  2. Dear Suresh, I had a bad experience with LIC’s Amulya Jeevan Term Policy.

    I am working in Calicut (Kerala) and I have purchased the Rs. 50 lakh term policy (LIC Order Number: 82812699017917) through LIC Direct online.

    The transaction was done on Nov. 19, 2014 by paying an amount of Rs. 10, 500/- . The hard copy was sent as directed on 25th Nov. 2014. In fact I received a phone call from Mr. Ujwal Kumar Ghosh to whom I was directed to send the had copy of the signed proposal form; on 17th December 2014 at around 1:30 pm mentioning that he had received my signed application form with photographs and he was sending it to Calicut (Kerala) office for my medical test and fixing of Premium. But till date (24th May 2015) no intimation was received by me for any medical test not I have received any other communication.

    I have contacted LIC direct customer service over phone several times, and after several requests through phone and email, they have send me a scan copy of the deposit receipt. That was on first week of March 2015. Further on contacting over phone, they said that my application is under processing, and soon I will be intimated towards my medical test at Calicut to fix the premium. But till date I have received no intimation.

    It is a matter of deep concern that LIC direct is handling its customers with such lethargic manner.

    Few days back I have sent a email to LIC’s grievance cell.(co_crm@licindia.com)

    Please advise, what should I do?

    Today, after paying Rs. 10,500/- SIX months back; and I have no live policy.

    1. Jayant, Very bad to hear your experience. I hope LIC grievance cell would be able to resolve it. Have you contact LIC customer care before approaching LIC grievance cell?

  3. hello Suresh Ji,
    Please suggest a best term insurance plan(online and offline both) for NRIs. – by ur NRI Fans. thanks.

    1. WoW, I was not aware that I have NRI’s Fans association :-). HDFC Click 2 protect and Kotak e-Term plan are available for NRI’s too. You can consider them.

  4. hi,
    your all analysis are really very good..i want to buy a term insurance plan for me, am 26 yrs old
    i am bit confused that i should buy a term plan of 1 crore sum assured or 50 lakh sum assured as i am a regular investor in PPF, LIC FD and mutual funds so please let me know whether i should go for 50 lakh or 1 crore.

    1. Gaurav, It depends on your requirement. Your family should be able to survive for atleast 15 years with monthly expenses apart from financial goals which you would have dreamed.

  5. Hi Suresh,

    Your blogs are really very informative. And its really helps us to take decision on investment.

    Here I need your valuable suggestion.

    I am 35 years old and non alcoholic and non smoker.

    I have 3 insurances in LIC…Jeevan anand-600000 sum assured, Jeevan Saral-500000 and Jeevan chaya-400000.

    Now again I want to investment 10,000/- month up to 7-10, years. Please guide me how can I invest?

    Looking forward to hear from you.

    Regards,
    Ramakrishna .

  6. I am not sure why and quite surprised that LIC’s plan has been included in this article. I think this is a gross mismatch here and can’t be called one of the best term plans for these reasons:
    1. This is only available offline – this is by far the biggest drawback of this plan. It is a known fact that LIC has been under pressure from its agents/unions etc. not to launch on-line term plan because their business would be directly impacted. And the worse thing is that LIC has succumbed to such pressure thus depriving customers a very good option. Even if it is true that some agents might leave LIC if it does go ahead with an on-line option, I am sure it would still have enough agents to do business. It is sad that the largest insurer in the country doesn’t have an on-line plan yet months and years after upstarts have launched it in the last few years.
    2. This follows from the first. Being offline, LIC would have to pay its agents who sell this plan and naturally this commission which is as high as 30% in some cases (I don’t know how much it is in this case), would come from the customer’s premium.

    Suresh, I think u should have highlighted both these aspects in your article for the benefit of newcomers who are not familiar with the insurance industry.

    1. Dinesh, LIC has launched e-term online term insurance plan recently. You can check. LIC has more than 98% claim settlement ratio and trusted one. Hence this is also considered as one of the best plans.

  7. Hi Suresh,

    I have taken AEGON Religare iTerm Insurance Plan in online . Could you plz let me know the settlement ratio for this policy and is it good policy?

  8. Hi , I have Bharati-Axa Term Insurance , it is not mentioned in the list. Please let me know any problem with this ?

  9. Hi Suresh,

    What is the difference between ICICI PRU Icare and Iprotect?It seems iprotect has less premiums.
    Do you recommend to take ICICI Iprotect

  10. Hi suresh,

    I am regular to your blog, very informative articles keep up the good work going 🙂

    I have lic jeevan tarang si 500000 & lic Jeevan Anand si 100000,now am planning to buy term insurance of 1cr which one is better among sbi/hdfc/reliance? is it good to consider accidental death benefit with this plan?

    How is lic Jeevan tarang policy already have paid 5 premiums still 10 remaining. Premium paying 34361 annually for si 500000 shall I continue or not?

    1. Hussain, You can buy icici term insurance of HDFC click 2 protect plus or SBI eshield term insurance. all are good and all these companies have high settlement ratio.

  11. Hi Suresh,

    I am 28 years old. I have decided to go for HDFC life click2protect(Smoker) with cover of 1 crore for 40 years.

    Have two queries:

    1) I read that HDFC will not take medical test once we apply for term policy (unlike LIC and SBI). Which is the good option for a smoker – they should take the test or not? I am aware that we should always disclose the correct info while buying insurance online and will do that.Is that sufficient?

    2) is it advisable to take extra accidental cover as it also increases the premium. It comes to 21k per year for 1 year which is on higher side and 15k with 1 crore without accidental cover. Please suggest

    Thanks in advance,

    Regards,
    Rocky

  12. Hi Suresh,

    I was going through the compiled chart above. I was just thinking regarding the reason for LIC Amulya Jeevan putting up a premium amount of Rs. 33,600 (without accidental death benefit) for 1 crore SA when all the other compaies with nearly same settlement ration charging half the premium. Is there any special advantage provided by LIC?  Also what happens if during the death of a person, the insurence company ceases to exist.

    Regards

     

  13. Hi Suresh,

    I just happened to visit your blog and quite impressed by the service offered.

    Please help me to select a term insurance policy.

    Personal Details: 36 years old, Married , 2 Kids , NRI, No Medical Problems, Non Smoker.

    I am planning to take a Term insurance policy worth 1 Crore, Could you pls suggest one suitable plan for me?

    Regards
    Raj

  14. Dear Suresh,

    My son 29yrs old, just married, takes a study break from his job. HDFC denied accepting his proposal for a term policy on the grounds that he is not salaried. Is this right? IS term plans an exclusive right for salaried class only?

  15. Hi Suresh,

    What is the diffrence between online ICICI I care II term Plan and ICICI I protect term plan. 

  16. Hi Satish,

    Thanks for all the information.

    My age is 30 yrs, Male, Married and smoke+drink.

    Please suggest any good term plan from amount 75 L. please do not suggest LIC. I saw few term plan :

    Aviva

    Reliance

    ICICI

    HDFC

    Kotak

    1. Hi Ram, I do not know whether you addressed me as “Satish”, thatz ok. Pls take LIC online term insurance plan or HDFC click 2 protect or SBI term insurance plan

  17. Dear Suresh,

    I currently have multiple life insurance with LIC (15L sum insured in total – Paying 60K yearly premium). This is money back policy though after terms got over. I now realized (after going through your post and all comments/advise) that terms insurance is way better then the one i have already obtained. So, I am planning to go for one with ICICI or HDFC (probably 1cr sum insure) once I received your answer on below question.

    (I must not forget that you have obtained the policies from these companies. Still like to ask you),

    The question is, these are the private companies (Not like LIC – govt.). I believe not insured by IRDA-govt. What happens to our paid premiums and sum insured, if these companies go out of market for some reason? Please do advise at your earliest convenience. Thanks so much.

    P.S. I really appreciate for your advise on one of my questions last week. This will help me make decisions. God bless you.

    1. Amit, IRDA who regulates insurance sector is very strict. After careful considering and taking adequate measures, private insurance companies are allowed. There is heavy competition. Also we should consider claim settlement ratio as primary basis in chosing term insurance plan. Hence I have personally chosen ICICI Term insurance plan which as 95%+ claim settlement ratio. You can trust large private insurance companies and consider insurance.

  18. Hi Suresh,

     

    First of all I would like to thank you for your valuable advices and time you give us from your busy schedule to guide us.

    I have been a consistent reader of your blogs since you started writting. I am stuck up in a dilemma in considering the term insurance.

    I earn 27k/month(in hand) and wanted to go for the term plan. However while comapring the term plan b/w ICICI Prudential and HDFC click2protect, I am unable to decide which one to go for. I am married, have a daughter of 2 years of age. I am a mild smoker (a cigarette a day) of 31 years old. Have some complication of Bronchitis. I wanted to take the plan, however representatives form ICICI & HDFC confused me. Please help me out.

    Settlement ratio:

    ICICI(96.7%)>HDFC(96.3)

    Premium:

    HDFC (Rs10506 inc tax)>ICICI (Rs10170 inc tax)

    Medical Test:

    HDFC:- Not required, but ready to take after I insisted, cost to be borne by HDFC, ready to share the reports.

    ICICI:- Not ready to take the test at all even after insisting, giving the reason that They have good settlement ratio and they only need medical if amt is  1 crore or above. If I disclose everything truthfully claim would be paid.

    EMI option(monthly payment of premium):

    ICICI: available from day one.

    HDFC: can be done after 1 year (will have to pay 1% extra per month)

    Smokers Group:

    HDFC: increases the premium amount.

    ICICI: Doesn't matter, smoker & non smoker have same premium.

    Accidental rider: ICICI(available), HDFC (unavailable)

    Step up Option: Unavailable in both Insurer.

    So I am confused, which one to opt for:

    ICICI looks good in premium, claim settlement and smoker's clause but not taking medical is putting me in dilemma. For HDFC medical test and result disclosure looks good but comparatibely higher premium, low claim settlement ratio, and non availability of riders are confusing me.

     

    Kindly suggest which one should I go for and is Rs 50L amount sufficient coverage for me?

    Should I step up or step down in terms of coverage?

    Should I purchase 1 plan for 50-70L or go for 2 plans one from each dustributing the coverage and shielding the case of denial making one primary and other secondary payer.

     

    Thanks a lot

    Vijay

     

    1. I suggest you go for ICICI Term insurance plan. After reviewing both these plans thoroughly, 5 months back, I have chosen ICICI Term insurance plan. Term insurance amount depends on your income and life style. If you are earning 5L per annum, Rs 50 L coverage should be sufficient.

  19. Hi,

    I am writing this on behalf of my younger brother, Ramkumar Balu. He is 32 years old, married and he has got one 2.5 years old male child.

     

    I would like to get your opinion on his existing Life insurance plan and looking for inputs to modify the Life insurance portfolio.

     

    His Family details

    Name – Ramkumar Balu

    Wife name – R. Gayathri

    Wife Age – 29years

    Child – One male child.

    Child Name – Chiranjeev

    Child Age – 2.5 years

     

    His income details 

    ————–

    He is working in one of Software company and earning 55000 INR per month. His wife is not working.

     

    Financial details

    ————

    He is having saving around 5 lakhs in hand and around 300grams of Gold and 10lakhs worth of Plot in Sivakasi.

     

    Existing Insurance details

    ——————-

    Two Insurance from LIC. Details are below.

     

    1. LIC – Jeevan Anand

    Name of the insurer – Ramkumar Balu

    Sum assured – 300000(3lakhs).

    Half Yearly Premium – 8050 INR.

    Commence from – 27/01/2012

     

    2. LIC Komal Jeevan

    Name of the insurer – Chiranjeev(His 2.5years old son)

    Sum assured – 300000(3lakhs)

    Half yearly premium – 11255 INR

    Commence from – 28/01/2012

    Date of maturity – 28/01/2038

     

    He is paying 38610 INR as insurance premium yearly. I feel like it is very high and not worth to continue. Please suggest some better insurance option like Term Insurance plan. I am thinking of MAX LIFE ONLINE TERM PLAN

    LIFE COVER PLUS MONTHLY INCOME PLAN. Since his wife is not working, it would be better his family will get monthly income even in his absence.

     

    Please provide the best insurance plan and amount to be insured for him. Please provide valuable suggestions.

    1. Hi Sivakumar, Good to hear that you as a elder want to provide guidance for your brother and his family. There is a problem in insurance. Insurance of Rs 6 Lakhs is very small amount and it would suffice just 12 months of your bother income. You should take atleast 10 to 12 years of insurance either on savings or on income. Considering Rs 50K income, he should have atleast Rs 70 to Rs 75 Lakhs of Insurance. This would cost just Rs 10K per annum by way of taking term insurance with any of the top insurance companies like ICICI Pru life or HDFC Pru Life. This should be first priority. Max newyork is good, but there are better term insurance plans like what I mentioned. You are already spending Rs 40K per annum for such insurance. Instead spend 10K for term insurance (you would get Rs 70-75 L coverage) and invest balance of Rs 30K in a FD. This amount may not be sufficient to get regular monthly income, but he need to plan and invest in RD or invest in best mutual funds to get good returns and child education plan. 

  20. Hi Sureshji,

     

    I am very much fan of your blog and need your suggestions on below things. I referred many friends to follow your blog.

     

    I have taken Term insurance of 50 lac from Bharti-AXA(claim settlement ratio-89%). I need to pay second year insurance premium but I am in dilemma whether to continue with the same or switch to HDFC.

    Shall I pay second year  premium to continue OR take/switch to another 50 lac from HDFC. Please suggest.

     

    I had taken ULIP plan from Reliance name is “Reliance super invest assure basic plan” in APR 2010. I paid 3 installments of 12k and now policy is in paid-up state and I have not paid any premium from last 2 year. My current fund value is 32K and fund name is “New Equity fund”. So please suggest me should I continue it or surrender it with 10% of penalty else It will be auto closed if I will not pay premium till APR 2015.

     

    Also, I had taken “Reliance cash flow plan- Money back”(here agent cheated me) in Dec 2010. In this plan my SA is 76K which will be paid in 3 installments as money back 25,333 INR in 4th,7th and 10th year of policy.

    So I will get 76k at maturity plus some bonus amount. This bonus amount I confirmed form cust care will be 2.1% on 76k which leads to max 21k over 10 years tenure. So, finally after 10 year I will get Max 95k only and loose 5k.  Here. I paid only 2 premiums and I am thinking to loose 20k. Please suggest should I continue or leave 20k?

  21. Hi Suresh how are you?

    It has been since we have had an interaction on this forum. Hope you remember me? 🙂

    I am in confusion yet again so you have to rescue me again 😛

    I am contemplating term insurance this year but slight confused. I have read and scanned through every article and term policy along with settlement ratios.

    Most of term insurances are for maximum 30 years. HDFC, ICICI, SBI and Kotak are offering maximum 30 years. I am 29 years of age healthy and no disease. However, considering average life expectancy of human in current scenario, it is around 65 years. So, my purpose was to take term insurance for longest duration.

    I came across TATA AIA I-Raksha Supreme policy. I understand claim settlement ratio of Tata Policies has been around 85% but the good part about the policy is that coverage is for 40 years at a premium of around 9k for 1 crore. Selecting policy on the basis of lower premium is also not advised. 🙂 

    But the fact of the matter is that claim setllement ratio does not tell us how many of the rejections were due to fraudulent cases and how many of the rejections were pertaining to term policy? These questions would always be unanswered.

    So my question to you is, considering brand name of Tata and 40yrs long term policy, does it make sense to go ahead with tata? 

    Or

    Plan B- Take 50 lac cover with hdfc/icici/sbi/kotak (help me pick one) and take remaining 50lac term cover after 10 years at a higher premium?

    Or 

    Plan C- Take 1cr cover with Tata and then after 10years take another cover with hdfc/icici/sbi/kotak or vice versa

    Look forward to your reply

    Regards,

    Zubin

    1. I remember you Zubin. I echo on what you said that fradulent cases Vs genuine cases there is no data. I personally would not try to consider taking term plans where claim settlement ratio is low. I agree that maximum being offered is for 30 years by those companies. Why not do a Plan-D by taking two policies of Rs 50 Lakh each from HDFC/ICICI/SBI/Kotak. After 10 years, you can discontinue one and take a fresh one for another 30 years at higher premium ?. This is one of the suggestion and there could be several other ways to do it. 

  22. Hi Sureshji,

    I am very much fan of your blog and need your suggestions on below things. I referred many friends to follow your blog.

    1.       I have taken Term insurance of 50 lac from Bharti-AXA(claim settlement ratio-89%). I need to pay second year insurance premium but I am in dilemma whether to continue with the same or switch to HDFC.

    Shall I pay second year  premium to continue OR take/switch to another 50 lac from HDFC. Please suggest.

     

    2.       I had taken ULIP plan from Reliance name is “Reliance super invest assure basic plan” in APR 2010. I paid 3 installments of 12k and now policy is in paid-up state and I have not paid any premium from last 2 year. My current fund value is 32K and fund name is “New Equity fund”. So please suggest me should I continue it or surrender it with 10% of penalty else It will be auto closed if I will not pay premium till APR 2015.

     

    3.       Also, I had taken “Reliance cash flow plan- Money back”(here agent cheated me) in Dec 2010. In this plan my SA is 76K which will be paid in 3 installments as money back 25,333 INR in 4th,7th and 10th year of policy.

    So I will get 76k at maturity plus some bonus amount. This bonus amount I confirmed form cust care will be 2.1% on 76k which leads to max 21k over 10 years tenure. So, finally after 10 year I will get Max 95k only and loose 5k.  Here. I paid only 2 premiums and I am thinking to loose 20k. Please suggest should I continue or leave 20k?

    1. Thanks Yogesh for your kind words. Here is what you can do 1) Consider taking HDFC or ICICI Term insurance plan. You can speed-up the process before current one expires 2) ULIP was taken from protection + wealth creation point of view. If you take care of point no.1, protection would be taken care. Coming to wealth creation, ULIP’s would provide anywhere between 4% to 5.5%. Means you can deposit such money in bank FD and get double returns 3) If you invest Rs 10K per annum for 8 years @ 9% in bank FD, it would fetch you Rs 120,000. However continuing this plan would earn you Rs 96,000 + risk coverage for Rs 1 Lakh. Risk coverage for Rs 1 Lakh is very small and it costs you less than Rs 500 and for 8 years it would cost you less than Rs 5,000. Means by coming out of this plan you get 115,000 (assuming you would buy some other term insurance for Rs 1 lakh) and by continuing this plan you would get Rs 96,000. Now I need not tell you what to do 🙂

  23. Hi, can someone help me to know what will be premium for 50lacs term life insurance for 30 yrs term. Max Life insurance (offline thru insurance agent) comes to around 30K whereas for LIC also it comes to be same. My age is 32 yrs, non-smoking individual. Max life insurance agent suggested me that for 50lacs the premium will be arounf 15K, but i thought as the term insurance SI increases the premium decrease. Plese clarify my doubt.

    1. Manish, It is not always true. I brought ICICI Term insurance plan couple of months back for Rs 50 Lakhs and I am paying around Rs 15K. At your age, it would be less than that. I am not saying max life insurance is bad. Consider taking high settlement ratio when selecting term insurance plans. This would one BIG help to your family when you are not there.

  24. what are your thoughts on Tata AIA I-Raksha Supreme term insurance? It is the only insurance company offering insurance 40years term insurance or up to 80 years of age (whichever less). premium is also 8600 including taxes for 28 years old. Claim settlement is 84% though. Other option is HDFC or SBI. HDFC you have had bad experience. So which one would you suggest to pick? 

  25. Hi Suresh,

    I am Rakesh, would like to invest upto 2000 rupees per month to get best returns. Please advise which policy is better or any good investment plan.

    Thanks

    Rakesh

    1. Rakesh, These are term insurance plans which one should consider for insurance risk coverage and not for returns. For investment purpose you should look for stocks, mutual funds and other fixed income options.

    1. Aviva settlement ratio is around 90%. Comparing to other top 5 plans suggested by me, this should be ok. Also I heard premiums are also low. You can consider it.

  26. Hi Suresh,

     

    Does this cover insurance for NRIs staying abroad? What are the T&Cs for the same.

     

    Regards,

     

    Ajay Dhoot

    1. Hi Ajay, As per my knowledge the term covers everywhere irrespective of whether the person is in India or outside India or travelling outside India. However insurance companies are floating specific plans for NRI’s as per their requirement. Hence if you are NRI, just check with insurance company before taking any term plan in India

  27. What are the rules if I opt for taking term policies from two different insurance companies? Do I need to inform the insurance about my other plan so that there is not settlement issue later.

    1. Amol, As per my knowledge, if you take two policies within same insurance company you need to indicate the same in your proposal. Otherwise if you are taking from two different companies, they would not ask you any questions during proposal time, hence you can ignore this.

  28. Thanks for the article. Its really helpful. 

    I have one doubt, where the benefits are almost similar, there is a huge difference between premiums specially LIC and others.  Can someone shed more light on it ? Why is LIC asking almost double the premium for same thing ?

     

    BR

    Amit

    1. Amit, Since LIC has good track record, high settlement ratio and trust built in, it charges high premiums. e.g. other insurance companies settlement ratio is low and they are just few years in insurance industry, hence to attract customers, they need to charge low premiums.

  29. Hi,

    I just wanted to know from where did you get individual policy wise claim settlment ratio?

    because I thought IRDA provided overall settlment ratio.

    Thanks

    1. Sager, You are right, this is at insurance company level only and not for specific policy level. Since you got such query, I just amended the line items to reflect that it pertains to insurance company level and not policy level. Thanks for your feedback.

  30. Hi Suresh

    Great Insight. However, you missed out on one point where most of these insurance companies try duping customers. They ask customers to undergo medical test even though a person is fit and healthy. And sometime they deliberately give negative review on medical test and their internal policy do not allow them to share the report with customer and demand a higher premium or else they reject policy and deduct medical test fee from premium and return money. I have heard many such cases.

    There are few companies like HDFC where they do not request customer to take medical test for cover under 75 lacs. Could you please enlighten me on term insurances from aforesaid companies that can be taken without medical test? If yes, what would be maximum that can be insured without medical test, like in case of hdfc for less than 75 lacs!

     

    Zubin

    1. Zubin, As per my knowledge except for LIC where they have limit of say Rs 10 Lakhs and beyond medical tests have to be done, all other private insurers do not ask for medical tests upto Rs 1 Crore and in some cases up to Rs 75 L (like HDFC). 

  31. What about the term insurance given by Aegon Religare? Its premium even for 1 cr and accidental Death Benefit(40lakhs) and Critical Illness rider is almost 10.5K.

    And this one is available for a really long period of age upto 75 years.

     

    I am 23 and want to have the best term plan for me. What are the main features that I should look for??

    Regards

    Navneet

    1. Navneet, Religare settlement ratio is just 66%. Means for every 10 claim applications received, they are honouring or accepting only 6 and rejecting 4 of them. I personally prefer to consider term plan with highest settlement ratio irrespective of insurance premium. 

    1. Shiv, As per my knowledge term insurance plans covers whether you are in India or outside India or travelling. However Indian insurance companies are issuing seperate plans for NRI’s to cater their need as they are going on long term assignments / job. It would be better to check with insurance companies before taking the policy if you are an NRI or person travelling abroad to avoid any further confusion.

      1. Hi,

        Thanks for reply. I am not an NRI but i might be travelling abroad. .

        I have another doubt. Will the policies cover accidental death while in travel.

        1. Hi Shiv, As per my knoweldge less. However insurance companies like ICICI Pru care offers increased protection for death due to accident with nominal additional premiums, but provides benefit up to Rs 50 Lakhs.

  32. Hello Suresh Sir,
    Thanks for the post. Sir what is ur opinion about aegon religare’s i-term plan and aviva i-life plan? Where to check claim settlement ratio? Once again thanks.

    1. Aviva life settlement ratio is 89.5% and Religare settlement ratio is 66%. These are available on respective insurance sites. Religare settlement is very very low comparing to other insurance companies. Hence if you are planning to take new term insurance plan, avoid such companies as of now.

  33. I have taken Aviva Life shief Platinum plus.  Its services are also good and have the 96% claim settlement ratio.  Can you comment on this

    1. Satish, Aviva Life insurance claim settlement ratio is 89.5% for FY 2011-12 (last report from IRDA) and not 96% as indicated by you. Min Sum assured is Rs 50L. Features are good except for low settlement ratio.

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