Introduction
In today’s uncertain world, financial security for your family has become more important than ever. A term insurance plan is one of the simplest and most affordable ways to provide a safety net for your loved ones in case of an unforeseen event. It ensures that your family continues to maintain their lifestyle and meet financial obligations such as loans, education, and daily expenses even in your absence.
But with so many options available, many people ask: Which is the best term insurance plan in India?
This article will give you a detailed overview of the best plans, their benefits, features, comparison, and tips to help you choose the right one.
What is a Term Insurance Plan?
A term insurance plan is a type of life insurance policy that offers financial coverage for a specific period (or “term”). If the policyholder passes away during the term, the nominee receives the death benefit. Unlike whole life or endowment policies, term plans are pure protection plans with no maturity benefit.
Key Features of Term Plans:
- High coverage at low premium
- Flexible policy terms (10 to 40 years)
- Rider benefits (like critical illness, accidental death, disability cover)
- Tax benefits under Sections 80C and 10(10D) of the Income Tax Act
- Customizable payout options (lump sum, monthly income, or combination)
Why Should You Buy a Term Insurance Plan in 2025?
- Affordability: For as little as ₹500–₹1000 per month, you can get coverage of ₹1 crore or more.
- Rising Lifestyle Costs: Inflation and high financial commitments make protection crucial.
- Dependents’ Security: Your family won’t face financial hardship if something happens to you.
- Peace of Mind: It’s one of the most effective tools for financial planning.
Best Term Insurance Plans in India (2025)
Below is a list of some of the top-rated term insurance policies in India based on claim settlement ratio, benefits, affordability, and flexibility.
| Insurance Company | Plan Name | Claim Settlement Ratio (2023-24)* | Key Features | Minimum Premium (approx.) |
|---|---|---|---|---|
| LIC of India | LIC Tech Term | 98.5% | Reliable brand, multiple payout options, online only | ₹600/month |
| HDFC Life | Click 2 Protect Super | 99% | Customizable coverage, critical illness riders | ₹650/month |
| ICICI Prudential | iProtect Smart | 98.7% | Covers 34 critical illnesses, multiple payout modes | ₹700/month |
| Max Life | Smart Secure Plus Plan | 99.5% | Low premium, accident cover, increasing sum assured | ₹550/month |
| SBI Life | eShield Next | 97.9% | Increasing cover, family income benefit | ₹580/month |
| Tata AIA | Sampoorna Raksha Supreme | 99.1% | Whole life cover option, flexible riders | ₹600/month |
| Bajaj Allianz | Smart Protect Goal | 98.4% | Child education benefit, terminal illness cover | ₹570/month |
*Data based on IRDAI Annual Report 2023-24
Detailed Review of Top Term Insurance Plans
1. LIC Tech Term (LIC of India)
- India’s most trusted insurer with decades of reliability.
- Offers flexible payout (lump sum or installments).
- Pure online plan with lower premiums compared to offline LIC policies.
2. HDFC Life Click 2 Protect Super
- Highly flexible term insurance with options like life cover, income plus, and return of premium.
- Covers death, disease, and disability.
- Allows increasing cover as per life stage needs (marriage, children, etc.).
3. ICICI Prudential iProtect Smart
- One of the most popular plans with wide coverage.
- Covers 34 critical illnesses along with death benefit.
- Offers terminal illness benefit at no extra cost.
4. Max Life Smart Secure Plus Plan
- High claim settlement ratio (99.5%).
- Affordable premiums, especially for young buyers.
- Option for increasing sum assured to fight inflation.
5. SBI Life eShield Next
- Designed for young professionals and families.
- Offers “Level Cover” and “Increasing Cover” options.
- Premium waiver in case of accidental disability.
6. Tata AIA Sampoorna Raksha Supreme
- Provides lifetime protection up to 100 years.
- Multiple rider options including terminal illness and disability.
- Known for quick claim settlement process.
7. Bajaj Allianz Smart Protect Goal
- Unique child education benefit to secure children’s future.
- Covers death, critical illness, accidental death, and disability.
- Affordable premium with flexible payout choices.
How to Choose the Best Term Insurance Plan?
When selecting the best term plan, consider the following factors:
- Claim Settlement Ratio (CSR): Always prefer insurers with CSR above 95%.
- Premium Affordability: Compare premiums across insurers.
- Coverage Amount: Ideally, your coverage should be 10–15 times your annual income.
- Policy Tenure: Choose a term that covers you until at least 60–65 years of age.
- Rider Benefits: Add riders like critical illness, accidental death, or waiver of premium for comprehensive protection.
- Payout Options: Choose between lump sum or income payout as per your family’s needs.
- Insurer Reputation: Trusted brands with strong customer support are preferable.
Term Insurance Riders You Must Consider
| Rider Name | Benefit Provided |
|---|---|
| Critical Illness Rider | Covers treatment costs of major illnesses |
| Accidental Death Benefit | Extra payout in case of accidental death |
| Waiver of Premium Rider | Premium waived in case of disability/illness |
| Income Benefit Rider | Regular monthly income for nominee |
Adding riders slightly increases the premium but ensures better protection.
Tax Benefits of Term Insurance
- Section 80C: Premiums paid (up to ₹1.5 lakh) are eligible for tax deduction.
- Section 10(10D): Death benefits received by nominee are tax-free.
- Section 80D: Additional deduction for premiums paid towards health-related riders.
Common Mistakes to Avoid While Buying Term Insurance
- Opting for lowest premium only without checking claim history.
- Choosing insufficient coverage (less than 10x annual income).
- Not disclosing existing medical conditions (may lead to claim rejection).
- Delaying purchase; premiums increase with age.
- Not updating nominee details after marriage/children.
Tips to Get the Best Deal on Term Insurance
- Buy early: Premiums are lowest when you’re young and healthy.
- Compare online: Use term insurance comparison portals.
- Annual premium mode: Save on GST charges compared to monthly payments.
- Maintain good health: Non-smokers and healthy individuals get lower premiums.
Conclusion
Choosing the best term insurance plan in India is not about picking the cheapest premium but about ensuring reliability, high claim settlement, and adequate coverage for your family’s financial well-being. Plans from LIC, HDFC Life, ICICI Prudential, Max Life, SBI Life, Tata AIA, and Bajaj Allianz are among the most trusted in 2025.
If you are young, buying a term insurance plan today ensures affordable premiums and lifelong peace of mind. Remember: a good term insurance plan is not just a financial product, but a promise of security for your loved ones.