Term Insurance is one of the simplest, most affordable, and effective ways to protect your family’s financial future in your absence. If you’re the sole earner or have people dependent on you, term insurance is a must.
What is Term Insurance?
Term Insurance is a type of life insurance policy that provides coverage for a specific period (term), like 10, 20, 30, or 40 years. If the insured person dies during the term, the nominee receives the sum assured.
If the person survives the term, no maturity benefit is paid (in pure term plans).
Key Features of Term Insurance:
| Feature | Description |
|---|---|
| 🎯 Low Premium | Cheapest form of life cover |
| 🧒 High Coverage | ₹50 lakh to ₹5 crore or more |
| 👪 Family Security | Financial protection for your dependents |
| 🔄 Flexibility | Choose term length: 10–40 years |
| 📉 Tax Benefits | Under Section 80C (up to ₹1.5 lakh) |
| 💼 Add-ons Available | Riders like accidental cover, critical illness, etc. |
Who Should Buy Term Insurance?
- Salaried employees with dependents
- Newly married individuals
- Parents with young children
- Business owners with liabilities
- Anyone with loans or financial responsibilities
How Much Term Cover Do You Need?
A good rule of thumb:
15 to 20 times your annual income
✅ Example:
If your annual income is ₹5,00,000
👉 Go for a cover of at least ₹75 lakh to ₹1 crore
Also, consider existing loans, child’s education, and inflation.
Types of Term Insurance:
- Level Term Plan – Same premium, same sum assured
- Increasing Term Plan – Sum assured increases yearly
- Decreasing Term Plan – Sum assured decreases over time (for loans)
- Return of Premium (TROP) – Get premium back if you survive the term
- Joint Life Term Plan – One plan for husband and wife
- Term Plan with Riders – Extra protection (accident, illness)
Top Term Insurance Plans in India (2025)
| Company | Plan Name | Claim Settlement Ratio |
|---|---|---|
| LIC | Tech Term | 98.5% |
| HDFC Life | Click 2 Protect Super | 99.4% |
| ICICI Prudential | iProtect Smart | 98.6% |
| Max Life Insurance | Smart Secure Plus | 99.5% |
| Tata AIA | Sampoorna Raksha Supreme | 99.0% |
| SBI Life | eShield Next | 97.5% |
🔍 Source: IRDAI Annual Report 2024
Documents Required for Buying Term Insurance:
- Aadhaar card / PAN card
- Income proof (Salary slips / ITR)
- Age proof
- Photograph
- Health declaration / Medical test (if required)
How to Buy Term Insurance Online?
- Go to trusted platforms like PolicyBazaar, Coverfox, LIC, etc.
- Enter age, income, and requirements
- Compare premium & features
- Select company & plan
- Submit KYC and medical
- Make payment and get policy instantly!
What to Watch Out For?
- Choose only IRDAI-approved companies
- Always disclose health issues honestly
- Don’t delay medicals, if required
- Read terms about “riders,” “waiting period,” and “non-payment” clauses
Conclusion
Term Insurance is the foundation of financial planning.
It costs very little but protects your family from huge loss in your absence. Whether you’re 25 or 45 — the earlier you buy, the better (and cheaper).
