In a world where financial security is more important than ever, term insurance has become a must-have for every earning individual. It provides your family with a financial cushion in your absence, ensuring they don’t struggle to meet essential expenses. Choosing the best term insurance in India can be overwhelming, given the number of plans, features, and premium structures available in the market.
In this article, we’ll help you understand what term insurance is, its key features, who should buy it, and a detailed comparison of the best term insurance plans in India for 2025.
All Contents
- 1 What is Term Insurance?
- 2 Why You Should Buy Term Insurance in 2025
- 3 Key Features of the Best Term Insurance Plans in India
- 4 Top 7 Best Term Insurance Plans in India (2025)
- 5 Comparison Table: Best Term Insurance Plans
- 6 How to Choose the Best Term Insurance in India
- 7 Tax Benefits on Term Insurance
- 8 Common Mistakes to Avoid While Buying Term Insurance
- 9 Conclusion
What is Term Insurance?
Term insurance is a type of life insurance policy that provides financial protection to the policyholder’s nominee in case of the insured’s untimely death during the policy term. It is one of the simplest and most affordable types of insurance with high coverage at low premiums.
Unlike traditional life insurance, term insurance has no maturity benefit. If the policyholder survives the term, no payout is made unless the plan includes return-of-premium or survival benefits.
Why You Should Buy Term Insurance in 2025
Here are some solid reasons why term insurance is crucial today:
- Affordable premiums with high life cover.
- Financial security for your family and dependents.
- Tax benefits under Section 80C and Section 10(10D).
- Customizable options such as critical illness cover, accidental death benefit, waiver of premium, etc.
- Peace of mind knowing your loved ones are financially protected.
Key Features of the Best Term Insurance Plans in India
When evaluating the best term insurance in India, here are some features to look for:
- High Sum Assured at Low Premiums
Some insurers offer coverage up to ₹1 crore or more at affordable rates, especially for younger applicants. - Flexible Policy Terms
Coverage can be availed up to age 75 or 85 depending on the insurer. - Riders and Add-ons
Add optional riders like critical illness, accidental death benefit, or disability waiver for enhanced protection. - Claim Settlement Ratio (CSR)
The higher the CSR, the better. Look for insurers with a CSR above 97%. - Premium Payment Options
Choose from regular pay, limited pay, or single premium options. - Online Availability
Plans available online are often cheaper and easier to manage.
Top 7 Best Term Insurance Plans in India (2025)
Here are some of the most popular and well-reviewed term insurance plans in India based on premium value, claim settlement ratio, and customer satisfaction.
1. LIC Tech Term Plan
- Offered by Life Insurance Corporation of India
- High trust value due to LIC’s reputation
- Coverage up to ₹1 crore and beyond
- Claim Settlement Ratio (FY 2023-24): 98.5%
2. HDFC Life Click 2 Protect Super
- Wide coverage options including increasing life cover
- Waiver of premium on disability
- Includes top-up options for future life stages
- CSR: 99.4%
3. Max Life Smart Secure Plus
- Option for return of premium
- Coverage till age 85
- Riders available for critical illness and accident death benefit
- CSR: 99.5%
4. ICICI Prudential iProtect Smart
- Covers terminal illness and accidental death
- Option to receive benefits in lump sum or monthly income
- Premium waiver on permanent disability
- CSR: 98.6%
5. Tata AIA Sampoorna Raksha Supreme
- Customizable payout options
- Critical illness cover available as rider
- High sum assured with low premium
- CSR: 99.0%
6. SBI Life eShield Next
- Online-only plan with affordable premium
- Increasing coverage over time
- Option to add accidental and terminal illness riders
- CSR: 97.8%
7. Bajaj Allianz Smart Protect Goal
- 100% coverage for COVID-19-related death
- Option for child education benefit
- Coverage till age 99
- CSR: 98.2%
Comparison Table: Best Term Insurance Plans
| Insurance Company | Plan Name | Maximum Coverage | Claim Settlement Ratio | Available Riders |
|---|---|---|---|---|
| LIC | Tech Term | ₹1 Cr+ | 98.5% | Accidental Death |
| HDFC Life | Click 2 Protect | ₹2 Cr+ | 99.4% | Critical Illness, Disability |
| Max Life | Smart Secure Plus | ₹1.5 Cr | 99.5% | Return of Premium, ADB |
| ICICI Pru | iProtect Smart | ₹3 Cr+ | 98.6% | Terminal Illness, ADB |
| Tata AIA | Sampoorna Raksha | ₹2 Cr+ | 99.0% | CI, Waiver of Premium |
| SBI Life | eShield Next | ₹2 Cr | 97.8% | Accidental Death, Terminal Illness |
| Bajaj Allianz | Smart Protect Goal | ₹1.5 Cr | 98.2% | COVID, Education Benefit |
How to Choose the Best Term Insurance in India
Selecting the right term plan depends on several factors:
- Your Age and Health Condition
Younger applicants get lower premiums. Disclose pre-existing conditions honestly to avoid claim rejection. - Family’s Financial Needs
Assess future expenses like children’s education, spouse’s needs, EMIs, etc., to calculate appropriate coverage. - Affordability of Premium
While more coverage is better, make sure the premium fits your budget throughout the policy term. - Claim Settlement History
Always prefer companies with a proven record of high claim settlement and smooth service. - Availability of Riders
Choose a plan that allows adding riders according to your needs for enhanced coverage.
Tax Benefits on Term Insurance
Premiums paid toward term insurance plans are eligible for tax deductions under the following sections:
- Section 80C: Deduction up to ₹1.5 lakh annually on life insurance premiums
- Section 10(10D): Tax-free death benefit for the nominee
Note: Ensure that the sum assured is at least 10 times the annual premium to enjoy full tax benefits.
Common Mistakes to Avoid While Buying Term Insurance
- Delaying the purchase till later age, leading to higher premiums
- Choosing insufficient coverage without factoring inflation
- Not disclosing medical history truthfully
- Ignoring rider options that could be crucial in emergencies
- Selecting policies only based on the lowest premium
Conclusion
Choosing the best term insurance in India is a major step toward securing your family’s financial future. In 2025, insurers are offering more flexible, customer-friendly, and digitally accessible plans than ever before. Whether you’re a salaried professional, self-employed individual, or someone planning for long-term financial safety, term insurance is a must-have in your portfolio.
Evaluate your needs, compare the top term plans, and pick the one that offers maximum coverage, relevant riders, and excellent claim service. It’s not just about life cover; it’s about protecting your family’s future when you’re not around to provide for them.