Best Term Insurance Policies for 2012

A lot of investors in India have realised the importance of term insurance plans vis-a-vis whole life policy and endowment plans which are quite expensive in nature as compared to term plans. 
But there are a lot of questions which comes to their mind while choosing a term insurance plan and choosing the best term insurance plan.


Question 1- Do they buy term insurance from LIC or private company?
Question- Should premium amount to be paid should be the only consideration in deciding term insurance plan
Question 3- Should they go for offline or online insurance plan keeping the cost factor into consideration


I am going to answer all these questions but before that lets understand, why do you need term insurance:

• Just because in case of your untimely death, you family dependents doesnt have to suffer too much on account of finances apart from emotional loss
•  After your death, your child needs higher education which may cost around 25-30 Lakhs after 12-15 years considering a annual inflation rate of 8%
• After you death, your wife has to take care of your child marriage which may cost around 40-50 Lakhs after 15 years

Generally one must choose a term insurance plan on the basis of brand name of the company and financial health of the company and most important the percentage ratio of claim settlement called claim settlement ratio of insurance policy. Generally life insurance premiums from LIC would be on higher side and they also have high claim settlement ratio. 

Lets have a look at the life insurance premiums offered by some of the insurance companies which can give us a sense of best term insurance policies:

	Sum Assured	Age of Policyholder	Tenure of the policy	Premium
Met Life	30 Lakhs	30	25 Years	4269
Kotak Life	30 Lakhs	30	25 years	4739
ICICI Pru Life	30 Lakhs	30	25 years	5129
HDFC Life	30 Lakhs	30	25 years	8512

One can buy online term insurance plans which are much cheaper as compared to offline term insurance policies because of high commissions involved in offline insurance policies. 

Another important point to look at while anlysing term insurance policies are riders

1. Accidental Death Riders- This means you will get additional life cover but only if you get death from accident

2. Critical Illness Rider- This will help you to get additional life cover if you die due to the illness mentioned in the policy while buying it

3. Disability Rider- This rider covers you for disability and pays you life cover in some predefined installments in the case where you become permanent disable

4. Waiver of Premium- In case you become permanently disable due to some accident, you would be waived off for the future premium payments while your term insurance policy will remain in continuation

Finally while choosing the term insurance plan, one can recommend choosing HDFC Life Insurance which has high claim settlement ratio though it has high premium, this option may be one of the best term insurance policies in India.