Getting the best term insurance plan involves finding the right balance between cost and coverage. A proper term plan will provide financial security for your loved ones without burning a hole in your pocket. As we move into 2025, let us see what makes a term insurance policy so valuable and how you can opt for one with low premiums.
1.What Makes a Term Insurance Plan the Best?
The best term insurance plan is not necessarily the cheapest one but the one that offers the correct balance of affordability, high coverage, and flexibility. The following are the essential features to consider:
- High Sum Assured at a Low Premium: The policy must provide high coverage to ensure your family’s future while keeping the premium reasonable.
- Flexible Policy Terms: Check for policies providing coverage until the age of 70 or 80 years for long-term financial protection.
- High Claim Settlement Ratio: Choose a term plan from an insurer with a good record of settling claims.
- Optional Riders for Additional Benefits: Riders such as accidental death, critical illness, and premium waiver provide extra financial security. However, some riders, like critical illness coverage, may increase premiums significantly.
- Tax Benefits Under the Income Tax Act: Term insurance premiums are eligible for deductions under Section 80C, and policy payouts may be tax-exempt under Section 10(10D), subject to conditions.
2.How to Choose an Affordable Term Insurance Plan?
Choosing an affordable term insurance plan from the available options creates an overwhelming situation. Use the following points to make a well-informed decision:
a.Determine Your Coverage Needs
Your term insurance sum assured should be 10 to 15 times your annual income by a multiple of ten to fifteen. Your family will be able to continue their current way of living after your death because of this insurance coverage.
b.Compare Premiums across Policies
Insurance organisations set their own rates when providing similar policy coverage. Online premium calculators enable users to evaluate multiple pricing options, which helps identify the least expensive policy.
c.Opt for a Longer Policy Tenure Early
Younger policyholders receive better rates when they purchase term insurance since their premiums are lower. Starting your term insurance in early adulthood, especially during your 20s or 30s, can lead to significant premium savings compared to purchasing a policy later in life.
d.Choose Annual Premium Payment
The single payment method of annual premiums is often less expensive than dividing payments across months due to lower administrative costs.
e.Look for No-Medical-Exam Policies (With Caution)
Some insurers offer policies that do not require a medical exam, which may be convenient for healthy individuals seeking quick approval. However, these plans often come with higher premiums and a lower sum assured cap, typically around ₹50 lakh to ₹1 crore. Insurers may also conduct background checks on medical history before approval.
3.Why 2025 Is the Right Time to Get Term Insurance
Securing life insurance through a term insurance plan in 2025 remains a smart financial decision as it offers long-term financial security. Premium rates may increase over time due to actuarial adjustments, regulatory changes, and evolving risk assessments. Locking in a policy earlier can help secure lower premiums for the long term.
Using the best term insurance plan that offers affordable premiums will protect your loved ones financially while staying within your budget. Devote time to analysing different plans and their value to obtain the most beneficial option.
