The LIC online term life insurance plan
LIC has finally joined the online bandwagon with its e-Term insurance plan. But with a very high premium compared to other insurers, should you consider the term plan?
Life Insurance Corporation (LIC) of India has made a term insurance plan available online. The company, one of the largest in the insurance industry in the country, had stayed away from the online market up until now.
The LIC e-Term insurance plan is a pure life cover plan and the premium is among the most expensive in the category, when compared with other insurers’ online plans. But then, the premium amount shouldn’t be the only thing you look at when getting such a plan. Also to be considered are other factors including an insurer’s claim rejection ratio and the maximum policy term offered. Read more on that here.
So what makes LIC’s e-Term insurance plan one to consider? Here are some of the main features of the policy.
Features of LIC’s e-Term plan
Different premium for smokers and non-smokers
Min sum assured: Rs25 lakh (aggregate category)
Min sum assured: Rs50 lakh (non-smoker category)
Max sum assured: No limit
Min age for policy: 18 years
Max age for policy: 60 years
Max coverage age: 75 years
Min policy term: 10 years
Max policy term: 35 years
The benefit of an online plan
Any online term insurance will be cheaper than getting one from the insurer’s office. Since there are no middlemen involved with the online term plan, the benefit gets passed to you. This is reflected in the fact that the premiums are less with the online term plan than if you got one from the company through an agent.
Let’s consider an example to demonstrate this. For a non-smoker who is 30 years of age, with a policy of Rs1 crore for a duration of 25 years, the premium with the e-Term plan would be Rs12,100 excluding taxes (Rs13,596 inclusive of taxes). However, with the same specifications, the premium for LIC’s Amulya Jeeva II would be Rs19,600 excluding taxes (approximately Rs22,023 when taxes are taken into account). This amounts to a yearly saving of about Rs8,400.
So if you’re simply looking for a term plan with the cheapest premium, this one won’t suit you. But if you prefer sticking to LIC for whatever reason – its settlement ratio, the brand value or the customer service it offers – the company’s online e-Term plan can only be good news.