Best Life Insurance Plans in India

In order to understand how life insurance plans, work, you need to look at two critical points. One is the purchase of the policy, and another is when the claim settlement must take place.

Let’s look at them one by one. 

Purchase of policy, premium and lump sum payments:
Under the life insurance agreement, the insurer promises financial protection by paying out death benefits in a lump sum or as regular payouts to nominees/beneficiaries in the unfortunate event of the demise of the life assured. These beneficiaries are designated in the policy documents itself and are usually family members or dependents of the life assured. The sum assured can be decided by the policyholder and should be enough to help your family maintain their lifestyle in your absence. Hence, a multiplier with your monthly salary is a good way of arriving at this figure. In return for this promise, the policyholder is supposed to pay an amount called premium. The amount of premium to be paid is defined at the time of purchase of the policy. To calculate the premium under a life insurance policy, the insurer takes your lifestyle and finances into consideration.

Claim settlement process with the insurer:
Upon the happening of the event for which the policy is drawn, the insurer will pay the beneficiary the entire coverage amount. Instead of a lump sum, if you want you can be paid in the form of instalments to the beneficiary/beneficiaries after your sudden death. The insurance company may also pay bonuses, based on the amount that has been accumulated over the policy tenure.
In order to acquire this money, the beneficiary/relative of the deceased policyholder has to get in touch with the insurer to intimate them of the situation. You have to provide the policyholder’s death certificate as a proof, along with other necessary documents as required by the company. After reviewing the documents, the insurer will either accept or reject the claim. Following that, an arrangement would be worked out for the payment of regular payouts or the lump sum.

Life insurance plans are heavily customized to suit your individual needs. There’s no one size fits all. However, life insurance is broadly classified into these categories, the parameters being the presence/absence of an investment or money back component, the goal they aim to serve, and scope of coverage.

• To ensure that your immediate family and dependents have steady financial support in the event of your demise and don’t have to deal with crippling debts or expenses.
• To provide your children with education and other needs you can life insurance for children.
• To have a constant source of income after retirement either through a pensions plan or a retirement solutions.
• To secure some extra income for medical contingencies like serious illness or accident.
• To create a corpus for other financial contingencies and lifestyle requirements

Choosing the best life insurance plan can be intimidating due to the plethora of considerations, so here’s a quick checklist of parameters to make the right decision:

Time Period
If you want seek protection for a certain time period, then go for term insurance. If your medium or long-term goal is to provide for your child’s education, choose an insurance plan that lasts around a decade. If you seek a lifelong insurance plan, then a whole life plan is the right choice. Simply put, align the tenure of the policy with your larger financial goal.

Type of life insurance plans
If you are only seeking protection for your family, choose term insurance. If you are looking for policies than can pay off debts, check out ULIPS, pension plans, money back plans, endowment plans etc., based on the time-period and individual needs.

Premium
Premium is an important factor, especially if you consider life insurance as a tax-saving product. The premium amount for endowment plans, ULIPs etc. are on a higher side when compared to term insurance, Money Back Plans and Pension Plans.

Arrive at a reasonable Sum assured
How many dependents do you have? Are you the sole breadwinner? One basic rule of thumb is that the death benefit on your policy should equal 7 to 10 times the amount of your annual salary.

Research, Compare and decide
Go online, seek quotations for your requirements by filling the appropriate forms and then compare them in terms of the policy period, premium, coverage. it is so much more convenient to buy life insurance online. To get an estimate how much premium you need to pay, you can refer to online life insurance premium calculator to get an overall idea about the premium calculations.

Buying online life insurance policy is a convenient, cost-effective and a pretty straight-forward process.

Furnish Basic Details
To begin with, you need to furnish your basic details in an application form, such as name, date of birth, contact details, smoking and lifestyle habits, income, expected life cover. This will generate quotes and provide different options to choose from.

Premium Payment
Once you have decided on the insurance policy you intend to go ahead with, the next step is the payment of the premium. You can pay using the modes of payment listed on the insurer's portal.

Provide Required Documents
The list of required documents will be sent to you once you fill the form and pay the premium, including identity proof, address proof, or health certificates.

Pre-policy Health Test
Some insurers require the potential policyholder to undergo a medical test. Such reports also need to be furnished.

Issue of Policy
Once all the documents are in place, the insurer will confirm your application and draft your policy papers.

At PNB MetLife, we understand that life is about the little moments and memories. In keeping with that belief, our life insurance helps you live worry-free amid the uncertainties of life.

We make sure your loved ones feel safe and financially protected from all harm in the unfortunate event of your demise and extend long-term financial security.

We bring together the financial strength of a leading global life insurance provider, MetLife, Inc., and the credibility and reliability of PNB, one of India's oldest and leading nationalized banks

We have a vast distribution reach with presence in over 111 locations across the country, serving over 100 million customers.

You can buy life insurance anytime between 18 to 90 years of age, but the sooner you get it, the better. Getting life insurance at a younger age ensures lower premium rates.

The amount of life insurance depends on various parameters like your age, number of dependents in your family, your debts and liabilities, your standard of living etc. As a rule of thumb, it is recommended that you choose a cover that is at least 10 to 15 times your current annual income.

A claim settlement ratio is the percentage of the number of insurance claims settled against the number of claims filed in a financial year. You should opt for an insurer with a high claim settlement ratio.

Even if you are a regular smoker, you can be eligible for a life insurance policy. However, you will have to pay a higher premium than a non-smoker. 

Life insurance is a legal contract that binds the insured policyholder and the insurance service provider. You, the insured, are required to pay premiums to the insurance company in return for which the insurer promises a protective financial cover. The financial cover can be in the form of an assured sum that’s paid out to your beneficiaries/nominees in the event of your demise. Alternatively, if you survive the tenure of the policy, some life insurance plans also give you a maturity benefit.

The unequivocal answer is yes. Life insurance is an extremely essential part of financial planning, particularly if you’re the breadwinner of your family and if you have financial dependents. In the event of your death, the financial benefits of a life insurance policy can help the surviving members of your family cope with the sudden loss of the main source of income. Additionally, it also equips them to pay off any debts or liabilities you may have left behind. The monetary cushion offered by a life insurance policy can help your family and beneficiaries significantly.

The purpose of life insurance is to help your family or your financial dependents survive the loss of revenue, at least until they can find an alternative source of income. So, the estimates will typically vary depending on your family’s average levels of spending. One way to approach this is to follow the general rule of thumb and opt for life insurance that is at least 7 to 10 times your annual income. Alternatively, you can also calculate the amount of income required for your family to survive after your demise. Subtract any other sources of income from that amount, and the balance is the insurance cover you need.

The cost of life insurance is directly proportional to the death benefits and maturity benefits offered by the plan. Other factors such as your age at the time of application and your medical history also play a significant role in determining the cost. The premium charged also varies from one policy to another. Depending on these factors, you can purchase a life insurance policy for as low as around Rs. 2,000 per month or for as high as Rs. 10,000.

You have the option to choose the scheme of paying your premiums. Depending on what’s convenient for you, you can opt to pay a single premium and purchase the cover, or you could choose to pay monthly, quarterly, semi-annual, or annual premiums. In addition to this, you also have the freedom to choose the mode of making these payments. If you prefer offline transactions, you can pay your premium using bank challans, demand drafts, or checks. Alternatively, you can also make the payments online using direct bank transfers or head to the insurer’s web portal to pay the premium. 

If you do not pay your premium on time, you run the risk of your policy lapsing. Most insurers generally offer you a grace period within which you can catch up on the payments you’ve missed. However, once the grace period is up, your life insurance policy lapses. This means that you will no longer be eligible to enjoy the protective cover of death benefits or maturity benefits. If you find yourself in this situation, you can reinstate your policy by contacting your insurer and paying all the outstanding premiums along with the interest and penalties charged on them, if any. 

The primary benefit of a life insurance policy is protective financial cover it offers. In case the policyholder dies, the beneficiaries or the nominees receive a lump sum payout to help them through tough times. Additionally, with a life insurance policy, you can also enjoy tax benefits on the premiums paid to purchase the policy. If you survive the tenure of the policy, you may even receive maturity benefits, depending on the kind of plan you opted for. Life insurance policies also allow you to take a loan against the plan in case you need to borrow funds to meet your life goals.

In addition to offering you a life cover, these insurance policies also provide tax benefits. According to section 80C of the Income Tax Act, the premiums you pay in each financial year can be claimed as a deduction from your total taxable income for that year. This has the effect of reducing your income, and therefore, also brings down the taxes you are liable to pay. The maximum amount of deduction you can claim is Rs. 1.5 lakhs each year.

If your insurance policy “matures,” it essentially means that cash value of the policy has grown to equal the death benefits. If you survive the term of the policy and live to see it reach maturity, the insurance provider generally pays out a lump sum amount, known as the maturity benefit. It includes the value of all the premiums you paid during the policy’s tenure, over and above which a bonus is added. In some cases, the insurer may extend the maturity date and make the lump sum payment only on the policyholder’s demise.

Most people generally purchase insurance policies from insurance representatives employed by the insurer. These third-party agents help people understand the features and benefits of various policies offered by the insurance company. On the other hand, if you prefer dealing directly with the insurer, you can simply visit a branch office, submit the necessary documentation, and purchase the policy of your choice. In recent years, with increased digitization, it’s also possible to buy life insurance online. If you’re tech-savvy and prefer online transactions, you can always head to the insurer’s web portal and purchase the policy of your choice from their site.

If the policyholder passes away, the nominee or legal heirs need to claim the death benefits offered by the policy. To file a life insurance claim, the first thing you’ll need is multiple copies of the death certificate. If you’d purchased the policy through a representative, you can then reach out to your agent, who will help you fill out the necessary forms and submit the claim on your behalf. Another way to do this is to directly visit the branch office, fill out the forms yourself, and submit the claim to the insurer. Some companies also offer the option of filing a claim online.

If you’re the primary breadwinner in your family, it’s evident that they depend on you for their financial requirements. In the event of your unfortunate demise, your dependents will need a monetary safety net to fall back on. A life insurance plan can help your spouse, kids, parents, or other financially dependent relatives meet their essential expenses in the immediate aftermath of your demise. Additionally, it can also help them repay any debt you may have left behind or pay for important needs like healthcare and education.

A life insurance policy can be beneficial to the policyholder in more ways than one. Here are the main advantages of investing in this instrument.

• A guaranteed Death Benefit
• Lifelong coverage
• Tax Benefits under section 80C
• An option to avail a loan against your policy
• Wealth creation in the form of maturity benefits

The term of life insurance policies varies from one provider to another. Typically, most insurers offer different plans with varying tenures. You can invest in life insurance that lasts for 10, 20, or even 30 years, depending on your age when you purchase the policy. Ideally, the younger you are when you invest in life insurance, the longer your policy can be. Shorter policies may mean higher premium payments. Some insurers providers also offer the option of 5-year or 10-year increments on the original policy term.

Most life insurance policies generally offer death benefits in case of natural deaths, such as those caused by a heart attack or old age. Life insurance also almost covers the deaths caused by accidents. In addition to death benefits, you can also opt for enhancer coverage with additional covers like a critical illness rider or a disability rider, which can help your family cope with financial distress in case the policyholder is diagnosed with a critical illness like cancer, or in case they’re unable to continue earning on account of any disability. In such situations, the rider on your policy may either offer a lump sum payment or ensure that you receive a steady sum of money periodically.

Yes, they are. As per the provisions of section 80C, the premiums you pay for your life insurance are deductible from your total taxable income. The maximum amount of deductions you can claim is Rs. 1.5 lakhs per financial year. If your premium payments add up to less than Rs. 1.5 lakhs, then the entire amount of premiums paid are deductible.

The earlier you invest in a life insurance plan, the more affordable it gets. When you’re younger, you have years of earning income ahead of you. You’re also healthier and generally more fit. So, insurance providers will charge you a more affordable premium in this case. Another way to make premiums fit better into your budget is to buy only the amount of coverage you actually need. You could also opt for a term plan that offers a pure protective cover, since these plans typically charge premiums that are relatively lower.

Here’s a quick look at the most commonly used life insurance terms.

Premium:Premium refers to the periodical payments made by the policyholder to the insurance company in exchange for purchasing the policy. Premiums can be one-time payments, limited-term payments, or regular outlays made over the entire tenure of the policy.

Sum assured:This is the amount that the insurance service provider will pay to the nominee in the event of the policyholder’s death.

Maturity benefit: This term refers to the sum that the insurer pays the policyholder if the latter survives the policy tenure. Term insurance plans do not offer any maturity benefits, but life insurance plans do.

Surrender value: In case the policyholder decides to discontinue premium payments before the policy matures, there’s always the option of surrendering the policy back to the insurer. On doing this, the insurance company pays the policyholder the surrender value, which is typically a certain percentage of the total basic premiums paid till surrender.

If you opt for a single premium policy, it means you’ll only need to make one payment. So, in this case, you can opt for the longest term offered by the insurer. On the other hand, if you opt to pay premiums periodically, ensure that you spread the payment period across your working years. By doing this, you can rest assured that you have the earning capacity to make all your premium payments on time. Keep in mind that policies that spread over a shorter period may often mean higher premiums.

You can change the nominee in your insurance plan either online or offline. In either case, you need to fill out the relevant nomination form and submit it to the insurance company. Depending on the particulars submitted, your insurance provider will update the nominee’s details in your insurance plan.

To purchase a life insurance policy online, you’ll need to submit various KYC documents to verify your age and address. Among these documents are your PAN Card, Aadhaar Card, Passport, Voter ID, Ration Card, Birth Certificate, Driving License, and Marriage Certificate if you’re married.