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Which is the best term insurance plan for 1 crore in India?

dateKnowledge Centre Team dateFebruary 09, 2021 views144 Views
which is the Best Term Insurance Plan for 1 Crore In India

In these times of increasing prices, a person needs to make sure that his family has enough to live comfortably. With rising living standards of people, inflation is also seen as a consequence. What should one do to make sure that his family won’t suffer in their absence.

Buying insurance is not a new thing now that is what makes people feel secure about both their present and future. Term insurance of at least 1 crore can make a person and his family sure about their future.

Various financial responsibilities may cause obstacles to happiness like children’s education, buying a new house, children’s marriage, etc. In such cases, there is a specific need to buy a term insurance plan.

What is a term insurance plan?

It is an insurance policy that provides the nominee opted by the insured with a specific amount of money and benefits, after the insured’s demise within a required term chosen by the insured.

If the plan completes the specified term, no benefits are provided to the policyholder. These are available at least premium rates that is why they are most opted for. These plans ensure the policyholder the coverage of the death or mortality risk.

Why choose a term insurance?

Isn’t it great to opt for a plan that asks a person to pay little, but it’s returns are great. Yes, a term life insurance plan provides benefits when there is darkness everywhere, and unfortunate times such as death of the only breadwinner of the family, etc.

Benefits of term insurance:

  • The affordable premium:
  • The thing about term insurance is that the premiums are affordable to everyone. This ensures that any person, even a common worker, can easily pay this insurance premium. Isn’t it better to pay less for something as normal and basic as life insurance? According to the policyholder’s convenience; he can pay a premium either monthly, yearly etc.

  • An assured sum that considers inflation:
  • Another great thing about term insurance is that while other plans provide an assured sum that can make a person enjoy their current lifestyle, term insurance considers the market’s ups and downs. These plans calculate their assured sum according to the situation of the market. Other plans demand a high premium for high assurance, but term insurance offers high sum assured at minimal premiums. A person can also choose whether he wants to provide his family monthly or yearly pay-outs.

  • A plan for younger people:
  • With its low premiums, high returns, flexible payment options, it is best suited for young people, especially those who have just started working. This ensures that a person can start early for an investment that is most important for one’s future.

  • Easy renewal:
  • It is important for insurance that comes with such amazing benefits to last long. This term insurance plan can be easily renewed, and a person can keep availing the benefits provided.

  • Riders provided:
  • There are specific riders available in term insurance plans such as accidental death benefit rider or accidental total and permanent disability riders. These riders exempted the option of buying a new policy for accident benefits.

Term plan’s tax benefit:

1. Tax benefits are available on the premiums paid for the term plan. Reduction in the premium under 80c of the Income Tax Act. These deductions are up to 1.5 lakhs. The reduction is available on policies before 31st march, 2012 if the premium is 20% of the sum assured. And for policies after 31st march 2012, if the premium is 10% of the sum assured.

2. Tax benefits can also be provided on the death benefit. The amount is exempt without an upper limit under section 10d of the Income Tax Act. If the premium paid is less than 10% of the sum assured or summed assured, it is ten times the premium. Any extra benefit that is available for the nominee is also exempted from the tax.

What is the 1 crore term insurance plan?

It is a term insurance that provides the insurance coverage of Rs. 1 crore. Other life insurance plans may demand a high premium on 1 crore assured term, but the term plan offers minimal premium and a coverage of 1 crore. These plans are regulated by IRDA( Indian Regulatory and Development Authority of India). These plans are available online as well as offline mode.

Is a 1 crore term plan suitable?

  • These term plans are best suited for individuals aged between 25 to 35 because such a large sum assured plan can increase up to 30 years.
  • People who are sole workers of the family can opt for this plan.
  • These plans are well suited for those who have an income range of 5 to 7 lakhs.

Canara HSBC Oriental Bank Of Commerce Life Insurance term insurance plan

Canara HSBC Oriental Bank Of Commerce Life Insurance till now provides only one term insurance that is iSelect star term insurance plan.

Canara HSBC Oriental Bank Of Commerce Life Insurance iSelect star term plan:

It is solely a death benefit plan that protects the policyholder’s sudden death or case of a terminal illness. The nominee opted by the policyholder receives the sum assured in case of death.

It offers namely two plans:-

  • Life term assurance-
  • The sum is fixed for the entire tenure of the policy.

  • Increasing term insurance-
  • A person can increase the assured sum according to his increasing financial responsibilities. The assured sum will keep on increasing every 5th year of the policy term by 25%. It will increase up to 100% then it will remain constant.

Eligibility for this plan

Parameters Minimum Maximum
Age limit at entry 18 years 65 years

For PPT Upto Age 60 years (Under Plan Option Life)# – 55 years

For PPT Upto Age 60 years (Under other Plan Options)# – 50 years

For Single Premium Option – 45 years
For Non-Working Spouse – 50 years
Age at maturity 28 years 80 years
For Whole Life Coverage# under Plan Option Life – 99 years
For ADB / ATPD – 75 years

Policy term/ premium payment term

Parameters Minimum Maximum
Policy Term (subject to Maximum Maturity Age) Plan Option Life – 5 years*

Other Plan Options – 10 years
Plan Option Life – 62 years except for Whole Life Coverage# where it will be fixed at 99 minus Age at Entry

Other Plan Options – 30 years
Premium Payment Term (PPT)
Life Single Premium (not available for Whole Life Coverage)

Limited Pay – 5* / 10 / 15 / 20 / 25 / Upto Age 60 years@#

Regular Pay – Equal to the Policy Term
Life with returns of premium Limited Pay – 10 / 15 / 20 / 25 / Upto Age 60 years@

Regular Pay – Equal to the Policy Term
Life plus Limited Pay – 10 / 15 / 20 / 25 / Upto Age 60 years@

Regular Pay – Equal to the Policy Term

Sum Assured

Parameters Minimum Maximum
Sum assured Plan Option Life – Rs. 25,00,000*

Optional In-Built Covers – Rs. 25,00,000

Other Plan Options – Rs. 15,00,000
As per Board Approved Underwriting Policy (BAUP)

For ADB – Rs. 3,00,00,000

For ATPD PPP – Rs. 1,00,00,000

For non-Working Spouse – Rs. 25,00,000

Benefits of this plan

  • Long term financial security-
  • iSelect Star Term Plan offers a life insurance coverage of 80 years, ensuring the longest financial security.

  • Advantage of spouse cover-
  • This plan ensures the coverage which extends to the policyholder's spouse. So it provides the longest financial security to the policyholder and his spouse.

  • Accidental death cover-
  • It is specially designed to provide cover for the death of the policyholder. So it helps the family of the assured to overcome the loss of death.

  • Increased coverage with increasing age-
  • A person's responsibilities increase with his age. iSelect star term plan offers coverage of the critical illness and accidents that come with increasing age. The coverage increases every 5th year of policy as policyholder ages. A person can opt for an increase of up to 100%.

  • Tax benefits-
  • A person is provided with tax benefits on the sum assured under 80c and 80d of the Income Tax Act. And it also provides the extra benefit of lifetime coverage even after the death of the holder.

How to choose the best 1 crore term plan?

While choosing the best 1 crore term plan a person needs to go through following questions as it is not something that fits everyone:

  • How much can a person pay? It is the very first question. The paying capability of the policyholder is the deciding factor so calculate using online calculators. Compare various one crore term plans and see what fits perfectly.
  • Note the benefits that every insurer offers and then compare. What kind of riders, policy, the flexibility of payment etc. that they offer? Holders should select the benefits that make the family comfortable and ensure a better future.
  • Settlement ratio of the insurer is another factor one should look after. It tells the number of policies settled by the insurer. Choose the one with at least 95% settlement ratio.

Why should you choose Canara HSBC Oriental Bank of Commerce Life Insurance?

  • Low-cost financial settlement-Canara HSBC Oriental Bank Of Commerce Life Insurance provides the policyholder with the low-cost settlement.
  • Rewards-This bank provides the holder rewards on living a healthy lifestyle. Special benefits if the holder is a non-smoker.
  • Premiums- You can opt for monthly or annual payment options at this bank.
  • Riders-Only Canara HSBC Oriental Bank Of Commerce Life Insurance provides the policyholder with accidental death benefit rider and permanent and final injury benefit rider.

Choosing the best 1 crore term plan can bring peace to the policyholder's mind. Opting for the right options is the correct decision. Go through various details like tenure of payment as well as its flexibility and benefits. Choose right and make the future of your family bright.

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Frequently Asked Questions (FAQs) for Term Insurance

This being a term plan doesn't offer any payout after maturity or expiration date.

Each insurance company has its own term insurance premium calculator. If you want to check out the premium quote, go for the iSelect Star term plan calculator. It gives a premium amount based on your age, gender, habits, education, and annual income.

You can purchase an iSelect Star term plan anytime between 18 to 70 years of age.

It depends on your needs. For example, if you want to cover a child's education or wedding expenses, you have to include them in your coverage. Your premium will be calculated accordingly.

If your key purpose is to give your Family financial protection, go for the term insurance plan. And if you want some savings, in the end, go for a traditional life insurance plan.

Go for at least 12 times cover than your annual income. Or you can go as far as 20 times coverage as per your needs.

The right time is when you don't have anything to keep your Family safe from financial storms, and they rely on you for financial needs.

If you are unable to make the payment or suffering from a terminal illness, a term plan pays a part of the sum insured to treat your disease.

Term insurance riders are attachment or endorsements made, while taking the term insurance policy, as a supplementary coverage to policyholders. Apart from the core death benefit, term insurance riders offer below-given additional benefits:

  • Accidental Death Rider When a person suffers from a terminal illness, his/her family ends up spending a significant amount in treatment and medical expenses. Accelerated death rider pays a part of the sum insured in advance to cover such costs and save the family from running out of cash.
  • Accidental Disability Rider If the policyholder can't pay the premium because of an accident or permanent disability, a sudden disability this pays the premium on behalf of the policyholder till completion of policy term or for a defined duration.
  • Critical Illness Rider If the insured person gets a heart attack, cancer, or any other critical illness, this rider pays a lump sum on valid diagnosis.
  • Premium Waiver Rider If the policyholder is unable to make payments due to income loss or disability, a premium waiver rider waives off all future premium payments. And the term policy remains active until the expiration date.
  • Income Rider: The rider ensures that your family receives regular income + sum insured in case of unfortunate demise of life insured.

Anyone can go for life insurance as it offers some savings after the maturity date, but it doesn't cover the protection of your family . The best term insurance plan is solely designed for taking care of loved ones if something happens to you. Term plans act as a shield between your family and sudden financial fall. They make sure that your family lives a healthy life even after you. With a little amount paid per year, you can be worry-free from the family's financial conditions.

Questions that you need to ask while buying Term Insurance?

  1. 1. Amount of premium you have to pay based on your age, habits, education, and monthly income
  2. 2. The total number of benefits covered in the term plan. Do they include benefits that you care about the most?
  3. 3. How to save money on tax if you pay for the term plan?
  4. 4. Do they offer regular income options?
  5. 5. Can you change the coverage and premium in the future?
  6. 6. Does the claim consider valid if death occurs outside India?
  7. 7. Which kind of death is not covered by insurance?
  8. 8. Can NRIs take term insurance? If yes, what are the conditions?
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