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A life insurance is a formidable financial cushion necessary for all. While it offers security to a family with a single breadwinner, it also helps individuals secure their life, especially post retirement. This is because a life insurance can be claimed by the insured even after it reaches maturity. It, therefore, promises a financially secured future, irrespective of anyone’s marital status, job or business stability.
Life Insurance is an assurance of financial cover to a beneficiary upon the death of the insurance holder or after a maturity period. This arrangement is entered through a legally binding contract between an insurance policy seller or provider and an insurance policyholder. The recipient appoints a beneficiary who will receive an insured financial aid after the death of the insurance holder. The insured amount is compiled over time by the policyholder through recurring monthly premium payments.
Even though life insurance, in general, is a straightforward financial investment with assured returns over maturity or after the death of the insured, there are various kinds of life insurances offered to the residents of India. These variations have their own targeted customers who may benefit from them uniquely. One has to carefully consider these types before choosing a plan that best suits them
Here are the types of life insurances offered in India.
Term life insurance is a fairly basic and common insurance plan where customers have the freedom to choose a term for their insurance, such as 10 years, 20 years, etc. This kind has a relatively cheaper premium due to its nature being a pure life cover. There are usually not any returns under normal conditions or expiration of the term period. The benefits are only provided in case of death or illness. The financial benefit is provided to the beneficiary of the insurance holder after his/her death during the term.
A whole life insurance policy offers a financial cover for the entire lifetime of the policyholder. It is only after the demise of the policyholder that the beneficiary receives the premium amount. There are several benefits available with whole life insurance, such as collateral benefits for availing loans, dividend paybacks at regular intervals, etc.
A two-way beneficial life insurance plan is just as much an insurance policy as it is an investment with returns. The endowment plan life insurance policyholder will have the benefit of receiving the full amount upon the expiration date of the policy along with the profits or bonus relative to the number of years the insured survived. Many see this as an investment opportunity that also provides a life cover.
With a money-back life insurance policy, customers are eligible to receive a sum of money at regular intervals along with the full payment at the expiration of the term or after the death of the insurance holder. Being an extremely rewarding policy, Money-Back Life Insurance Policy is one of the most expensive policies to purchase. It is worth considering given its returns are assured in the form of survival benefits, death benefits and term-expiration benefits.
A hybrid of life insurance and investing, Unit Linked Insurance Plan (ULIP) is a unique and popular life insurance plan to look out for. The special features of ULIP include allocation of funds towards the policyholders' life insurance and rest invested in the various Investment instruments such as mutual funds, equities, etc. There are benefits of ULIP for a policyholder in terms of cash-flow allocation in relation to market behavior. The percentage of funds allocated for investments is generally handled by an expert fund manager.
It is almost prudent to have our lives insured and financially covered so that our loved ones do not have to face money-based needs after our lifetime. This demand equally needs to be matched with entities supporting the cause.
In India, there are 58 officially listed insurance companies along with 34 general insurance companies. These companies provide a great deal of assistance in helping people secure their lives for their loved ones.
Given below is a list of the top 10 life insurance companies in India that have impacted the insurance industry gravely.
LIC or Life Insurance Corporation of India is a government-approved statutory entity that came into effect by the LIC Act, 1956. It is one of the major insurance policy providers in India. Since its establishment in 1956, LIC has generated a revenue of 74 billion USD. The corporation is parent to subsidiaries like LIC Housing Finance, LIC International Ltd., LIC Cards Services Ltd., LIC Mutual Funds, etc.
Life Insurance Corporation has various insurance products. This includes endowment plans such as LIC’s Bima Jyoti, LIC’s Bachat Plus, LIC’s New Jeevan Anand, etc.; Whole Life plans namely Jeevan Umang; Money-Back Plans such as LIC’s Dhan Rekha, LICs Bima Bachat, LICs Jeevan Tarun, etc.
Another major company in the insurance industry that has managed to raise a revenue of US$350 million is ICICI Prudential Life Insurance. It offers an array of life insurance products for people with various exigencies of life. The products enlisted with the ICICI Prudential Life Insurance company are term insurance plans, health insurance plans, unit-linked insurance plans, traditional savings/money back plans, retirement plans, riders plans, group plans and rural plans. ICICI Prudential also claims to provide complete protection and savings benefit
Approved as one of the best insurance companies in India by the Insurance Regulatory and Development Authority of India (IRDAI), SBI Life Insurance operates with its high standard policies and service. SBI Life Insurance offers products for both individual life insurance as well as group life insurance. Some of the popular life insurance plans include Arogya Shield, SBI Life eShield Next, SBI Life Saral Bima Jeevan, etc.
This large non-banking Insurance company was founded in the year 2000 and is well funded by an Indian multi-venture company and a Japanese Insurance Company. Max Life Insurance Company, since its establishment, managed to raise a net income of more than INR 400 crore. The company offers various term plan products to its customers along with excellent customer service. Some of the main features of their Term Insurance Plans include a cheaper minimum purchase amount, guaranteed terminal illness coverage, tax exemption, etc. Customers can consider the Smart Secure Plus Plan, Term Plans With Return of Premium, Saral Jeevan Bima or the Critical Illness Plan..
Another crucial private insurance company, namely, HDFC Life Insurance Company is a joint venture of HDFC Ltd. and Standard Life Aberdeen, which was also founded in the year 2000. HDFC Life Insurance has established a strong digital base allowing its customers to easily access its products and services. Moreover, with several agencies supporting the company's operations, HDFC Life Insurance manages to offer its customers a holistic service. Some of the main products offered by the company include HDFC Life Click to Protect Life, HDFC Life Saral Jeevan Bima, Quick Protect Plan, HDFC Group Poorna Suraksha, HDFC Life Group Credit Protection Plus, etc.
There are various companies offering high-end insurance products that serve the public needs in diverse ways. These products are often modified with current prices and policies with respect to both market behaviour and industry competition. Here are some of the best-fared life insurance plans in India in 2022:
Life Insurance Corporation (LIC) introduced the plan in the year 2019 and assures the customers of a pure protection policy. This policy is a non-linked non-profit policy that aims to provide financial cover for the benefactor at the time of the insurance holder’s demise.
HDFC Click 2 Protect Plus is another Term-Life-Insurance Policy that has fared well among the public. HDFC Life Insurance introduced this plan with the aim to provide an extensive life cover at a lower cost along with complete protection for the customer and his/her loved ones. The policy is modifiable in terms of cover options, such as life option, extra-life option, income option, income plus option, etc.
Max Life Smart Secure Plus Plans offer great financial protection along with repayment flexibility. The minimum age to enter into this policy is 18 and a maximum of 65 years. The premium can be paid till the age of 44-60 years. There will be an assurance of up to INR 20 Lakhs in case of a base death benefit.
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