Life Insurance is an essential financial instrument that binds the policyholder and insurer into a contract, per which the insurer will pay the policyholder a certain amount of money in exchange for premium payments done on a regular basis, in case of any unfortunate event.
A Life Insurance Policy safeguards the future of your loved ones by providing financial aid. Some Life Insurance Policies even allow maturity benefits in case your policy term has expired. It may ensure cash flow during difficult times. However, policies need to be chosen carefully as per your needs to serve the maximum benefits.
Given this, you may be interested to know about the life insurance policy types and the key differences between them. Here we will discuss the life insurance policies and best premiums.
Types of Life Insurance Policies Available in India
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Term Insurance
Term Insurance is the most affordable type of life insurance in India, which offers financial coverage for a specific amount of time. In exchange, the policyholder is obliged to pay a certain amount of insurance premiums to the insurer. In case of the accidental death of the policyholder, the nominee receives the cover amount. This amount depends on the type of insurance policy.
Term Return of Premium (TROP) works in a similar way as term insurance. However, it also provides an additional feature of survival benefit. Along with Life Cover, If the policyholder survives the policy term, then all premiums are paid back, with GST.
Whole Life Insurance covers an entire lifetime, up to 100 years. It will ensure the insured amount is left to your family, after your demise.
Features of Term Insurance:
- It has affordable premiums as compared to other types of life insurance policies.
- It offers flexible policy terms that can range anywhere from 5 years to 40 years. It allows the policyholder to choose the plan as per their financial requirements and investment goals.
- It provides significant financial protection to the family of the policyholder in case of an unfortunate event.
- Premiums paid toward Life Insurance have tax benefits under the old and new tax regimes, as Section 80C of the Income Tax Act.
Unit Linked Insurance Plan
Under the ULI Plan, investors get the double benefit of insurance and an investment plan. Part of the Premium amount is allocated towards life insurance, while the remaining amount is invested into equity or debt funds. It also offers tax benefits as per Section 80C and Section 10D of the Income Tax Act.
Features of a Unit Linked Insurance Plan (ULIP):
- The ULIP serves as both an investment opportunity and an insurance plan. This provides the double benefit of financial protection and wealth generation to the policyholder.
- Insurance Premiums are subjected to tax benefits under Section 80C and Section 10D of the Income Tax Act, which allows the maturity to be tax-free.
- It provides life cover insurance.
Endowment Policy
It serves life cover and also provides saving benefits to its policyholders. A guaranteed sum is provided to the nominee in case of an untimely death of the policyholder. In addition, the maturity is paid to the policyholder at the end of the policy term.
- Money Back Policy: A Money Back Policy has Life Insurance and regular payouts to the policyholder, also known as survival benefits. The premium for money-back policies is usually higher but is suitable for those looking to make a regular income. It also provides maturity benefits at the end of the policy term.
Top Life Insurance Policies in India
Here, we list the top life insurance policies available in India.
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ICICI iProtect Smart
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max / Min) | 5 Years / 99 Years |
| Assured Sum (Max / Min) | Rs. 50 Lakh / Rs. 1 Crore |
| Claim Settlement Ratio | 97.82% |
| Premium Payment Mode | Single, Yearly, Half-yearly and Monthly |
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HDFC Click 2 Protect Super
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 years |
| Policy Term (Max / Min) | 0.1 Years / 85 Years |
| Assured Sum (Max / Min) | Rs. 50 Lakh / Rs. 20 Crore |
| Claim Settlement Ratio | 98% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or Monthly |
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Max Life Smart Secure Plus
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max / Min) | 10 Years / 67 Years |
| Assured Sum (Max / Min) | Rs. 20 Lakh / No Limit |
| Claim Settlement Ratio | 99.34% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or Monthly |
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TATA AIA Sampoorn Raksha Supreme
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 60 years |
| Policy Term (Max / Min) | 10 Years / 67 years |
| Assured Sum (Max / Min) | Rs. 50 Lakh / Rs. 20 Crore |
| Claim Settlement Ratio | 99.34% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or Monthly |
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Bajaj Smart Protect Goal
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max/ Min) | 5 Years / 40 Years |
| Assured Sum (Max/ Min) | Rs. 50 Lakh / Rs. 1 Crore (Rs. 2 Crore with rider) |
| Claim Settlement Ratio | 99.02% |
| Premium Payment Mode | Yearly, half-yearly, quarterly, and monthly |
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PNB Met Life Mera Term Plan Plus
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 60 Years |
| Policy Term (Max / Min) | 10 Years / 40 Years with ROP and 99-Entry age without ROP |
| Assured Sum (Max / Min) | Rs. 25 Lakh / No Limit |
| Claim Settlement Ratio | 97.33% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or Monthly |
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Canara iSelect Smart 360
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max / Min) | 5 Years /81 Years |
| Assured Sum (Max / Min) | Life Secure Rs. 25 Lakh and Rs. 15 Lakh for ROP and income benefit |
| Claim Settlement Ratio | 98.44% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, and Monthly |
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Kotak Life e-Term Plan
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max / Min) | 10 Years /40 Years |
| Assured Sum (Max / Min) | Rs. 25 Lakh / No Limit |
| Claim Settlement Ratio | 98.5% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or monthly |
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Edelweiss Tokio life Total Protect Plus
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max / Min) | 5 Years / (100 minus your Current Age) Years |
| Assured Sum (Max / Min) | Rs. 25 Lakh / No Limit |
| Claim Settlement Ratio | 98.09% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or Monthly |
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IndiaFirst e-term Plus Plan
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max / Min) | 5 Years / 40 Years |
| Assured Sum (Max / Min) | Rs. 50 Lakh / No Limit |
| Claim Settlement Ratio | 96.92% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or Monthly |
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Birla DigiShield Plan
| Plan Type | Term |
| Maximum and Minimum Age | 18 Years / 65 Years |
| Policy Term (Max / Min) | 5 Years / (100 minus your Current Age) Years |
| Assured Sum (Max / Min) | Rs. 30 Lakh / No Limit |
| Claim Settlement Ratio | 98.07% |
| Premium Payment Mode | Yearly, Half-yearly, Quarterly, or Monthly |
Conclusion
With a variety of insurance policies available in the market, it is essential to choose the best life insurance policy in India based on your financial goals and requirements. Term insurance is an affordable option that offers pure life cover, while ULIPs provide insurance and investment benefits. Endowment policies and money-back policies offer guaranteed returns and periodic payouts, respectively, making them suitable for risk-averse and income-seeking investors. It is advisable to compare different policies. Read the policy documents carefully and consult a financial advisor before making a final decision.
Disclaimer
The investment options and stocks mentioned here are not recommendations. Please go through your own due diligence and conduct thorough research before investing. Investment in the securities market is subject to market risks. Please read the Risk Disclosure documents carefully before investing. Past performance of instruments/securities does not indicate their future performance. Due to the price fluctuation risk and the market risk, there is no guarantee that your personal investment objectives will be achieved.