Imagine you want to buy an air conditioner. You'll first conduct proper research and filter the top brands available on the market. Next, you’ll compare various models based on their price, features, customer reviews, ratings, etc. You'll then zero in on the model that best suits your needs and budget, choosing a brand that offers the best features and the best service.
Similarly, when it comes to term life insurance, it is important to choose a trustworthy and reputable insurer. After all, the only reason you buy term insurance is to protect your family financially - should the worst happen. In this article, we will discuss the best term life insurance companies in India and the things you should look out for in them.
What is Term Insurance?
Term insurance is an excellent option for anyone who wants to ensure their family's financial security. If something unfortunate happens to you, the policy provides a fixed amount of money to your loved ones, giving them the financial security and stability they need to move forward. However, you need to remember that term insurance is a pure risk cover. This means it does not give any payout if you survive the policy term.
The main purpose behind purchasing a term insurance policy is to secure the financial future of your family when you are no longer around. And, you would obviously want them to receive the entirety of the benefits under the policy so they can tackle such a hard and taxing time with ease. The money will help them meet their financial obligations and maintain their lifestyle.
To make sure that your family members receive the complete benefit under your term insurance policy, you need to buy it from a credible and trustworthy insurance company. Picking the best insurance company will give you the assurance that your family will be well provided for - since you will be out of the picture then.
But, how do you choose the best insurance company? Let’s see.
Factors To Keep An Eye On While Buying Term Insurance From An Insurance Company
Here are some of the important things to look out for in an insurer -
The solvency ratio is an important metric used to determine an insurer’s financial strength and capability to meet its financial obligations. According to the Insurance Regulatory and Development Authority of India (IRDAI), all insurance companies need to have a minimum solvency ratio of 150% to ensure they have sufficient capital to settle their liabilities. It is therefore recommended that you choose an insurance company that has a high solvency ratio, which means that they have sufficient financial resources and assets to pay out claims, take care of any crises, stay afloat when the business is slow, etc.
Claim Settlement Ratio
The claim settlement ratio refers to the percentage of claims an insurance company settles to the total number of claims it receives in a particular financial year. It shows how reliable and effective an insurer is at settling claims. If the claim settlement ratio of an insurance company is high, it indicates the company fulfils its promise and meets customers' expectations. In other words, the higher the CSR, the higher the chance of your family's claim being settled in the future.
Every insurance company offers different benefits and features, so ensure you make a proper comparison before making a decision. The scope of coverage provided by the insurer determines the level of protection your family will receive in the face of a tragedy. Ensure you choose an insurance company that offers adequate coverage and a wide range of benefits, so your family is well-protected.
The premium is a certain amount that you are required to pay in order to keep your policy in effect. Given that term insurance is a long-term commitment, make sure the insurance company you choose provides the coverage you need at an affordable rate, so you can pay the premiums comfortably throughout the premium paying period. You should compare the premium quotes of different insurance companies and pick the most affordable out of the lot to get the best value for your money.
When you are choosing an insurer, it is also important to assess the quality of their customer service. It is always recommended to select an insurance company that offers strong customer service that’s available around the clock, so you or your family can contact them at times of need.
Spend enough time to read customer feedback before making a decision. This will give you a better picture of the company's service quality, claims settlement process, and other important aspects. You can reach out to past and existing customers and inquire about their experiences. In this way, you will be able to gain a better understanding of the company and decide if it is the right choice for you.
Best Term Insurance Companies in India
Here are some of the leading term life insurance companies in India -
1️⃣ Aditya Birla Sun Life Insurance Co. Ltd.
ABSLI has a claim settlement ratio of 98.07%. Their solvency ratio is 188%. Aditya Birla Sun Life DigiShield is a popular term plan sold by them where the minimum and maximum entry age is 18 years and 65 years. The maximum maturity age available is 85 years.
2️⃣ HDFC Life Insurance Co. Ltd
HDFC Life Insurance Co. Ltd has a claim settlement ratio of 98.66% and it possesses a solvency ratio of 176%. One of the prominent plans it sells is HDFC Life Click2Protect Super Life, which comes with a minimum and maximum entry age of 18 years and 84 years. The maximum maturity age available is 85 years.
3️⃣ Max Life Insurance Co. Ltd
Max Life Insurance Co. Ltd has a solvency ratio of 201% and a claim settlement ratio of 99.34%. One of its top plans is Max Life Smart Secure Plus. It has a minimum and maximum entry age of 18 years and 65 years. The maximum maturity age available is 85 years.
4️⃣ TATA AIA Life Insurance Co. Ltd.
TATA AIA Life Insurance Co. Ltd. has a solvency ratio of 196%. Their claim settlement ratio is 98.53%. One of their well-known plans is TATA AIA Sampoorna Raksha Supreme, having a minimum and maximum entry age of 18 years and 65 years. And, the maximum maturity age under the plan is 100 years.
The importance of choosing a good insurance company cannot be overstated. Make sure you compare and evaluate different insurance companies based on several factors like coverage, claim settlement ratios, customer service, financial stability, etc. By choosing the best insurance company, you can rest easy knowing that your family is in safe hands.