How to Approach Term Insurance Comparison in India

More individuals are now keen on ensuring a safe and secure financial future for their family members, especially in case of their untimely death or other unwanted mishaps. 

As a result, many are looking for term plans that accompany extensive coverage and a simple claim process. 

However, the availability of multiple policies makes it difficult for many to compare term plans. 

To avoid confusion, one should focus on the accompanying features of the term plans and their terms of claim to pick one that best suits their needs. 

That said, let’s delve deeper into what to look for to compare term plans better. 

Factors to consider when looking for a term insurance plan

Typically, a term plan is designed to offer financial benefits to the insured’s family members in case of their untimely death. However, nowadays, insurance providers are extending a wider range of term plans to enhance the scope of offerings. This adds to the confusion of individuals who find the options overwhelming. 

However, to ensure one gets the best of term plans, one should weigh in these factors for effective term insurance comparison

  • Claim Settlement Ratio

Leading insurance providers mention their claim settlement ratio on their websites. It appears as a percentage of claims they have settled from the total applications they have received in a given year. 

Consider a provider with a robust claim settlement ratio when looking for a term insurance plan. This shows the chances of getting an insurance claim approved are higher. While at it, individuals should also check the process of raising a claim. This will ensure you pick a term insurance plan that accompanies easy claim features so that the beneficiary can submit a claim without much hassle. Also, a simple claim process ensures simple verification and quick approval. 

Additionally, make it a point to check the terms and conditions that accompany the claims. Reading the fine print is crucial to know what comes under the purview of an insurance policy and what doesn’t qualify for a claim. 

  • Solvency Ratio

The solvency ratio is an indicator of the financial health of the insurance provider, and this further ensures that the insurer will be able to settle the claim. Notably, every insurer in India must have a solvency ratio of at least 1.5, as mandated by the Insurance Regulatory and Development Authority of India. It is recommended to always go for an insurer with a higher solvency ratio. This will prove useful when a large number of claims are raised within a small window, say, in case of a disaster. 

  • Critical Illness Cover

Besides the death benefits, insurance providers today extend extensive critical illness coverage to enhance the policy benefits. Usually, the critical illness cover comes as an add-on that expands the scope of the term insurance policy. 

If a policyholder is diagnosed with any of the listed health conditions covered under their plan, the policy will pay a certain percentage of the sum assured. This financial aid can be used for treatment and to cover hospitalization expenses. 

Based on one’s coverage needs, individuals can add as many critical illness add-ons as they deem essential. Notably, critical illness cover add-ons offer tax benefits to the insured. The insurance premium paid toward the coverage can be claimed for tax deduction under Section 80D. Weigh the extent of coverage offered by different providers for effect term insurance comparison.

  • Additional Rider Benefits

Insurance policy providers also extend additional rider benefits to make the term plan more flexible for consumers. 

Some of the most popular rider benefits include the following –


  • Accidental death benefit
  • Income return benefit
  • Waiver of premium benefit
  • Return of premium benefit

To avail of additional rider benefits, you need to pay an extra premium over the existing amount. Compare the rate of additional add-ons and their coverage to pick a better plan. 

  • Insurance Premium Rates

It is important to weigh the premium amount to know if they should fit your budget Or not. 

A basic term insurance policy is the most affordable life insurance product in the market. However, adding rider benefits tends to increase the policy premium. 

While a term insurance plan with a higher premium offers more extensive coverage, it is essential to check other aspects as well. 

Compare the coverage offered by other insurance providers to understand which plan offers what coverage and which suits you the best. 

You may also use a term insurance premium calculator to determine the payable premium. It can also help you ascertain if the same suits your pocket and financial goals, especially when opting for other investment options in India. 

  • Check Coverage Requirement

The key is never to go overboard when taking term insurance coverage. However, that doesn’t mean you will pick the most basic plan. It is always recommended to weigh in on one’s needs, especially the family’s needs and requirements, while selecting a term insurance coverage. 

Always pick coverage after weighing your family’s expenses, current financial needs, and future goals. This way, you will be able to ensure your family’s financial future and safeguard their future. 

Besides these, always buy a term insurance plan from a trusted provider. This will ensure that you are able to settle your claim with surety or receive maturity benefits without any hassles. 

When is the right time to buy a term insurance plan? 

The right age to get an insurance plan is when you have less financial liability and are in the pink of your health. In other words, getting a term insurance plan early in life is recommended to avail of the most benefits. 

The health complications tend to be lower at an early age, and the risk of the same surges as one gets older. 

To offset the risk, insurance providers charge insurance buyers a higher premium, mainly if they belong to the older age group. Keeping these aspects in mind will help make an informed term insurance coverage.

Also, most young policyholders are likely to outlive the policy term and can benefit from the accumulated policy amount, which will serve as a corpus on maturity, making it one of the lucrative investment options in India

Regardless, individuals must always weigh their current financial standing before buying a policy because it is equally essential to maintain the insurance plan after buying it.

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