Best Term Insurance Plans in 2025 You Can Buy Now to Secure Your Family & Save Tax

Why Term Insurance Is More Important Than Ever in 2025

In today’s fast-paced world, financial security is not just a luxury — it’s a necessity. If there’s one financial product that guarantees your family’s financial safety even in your absence, it’s term insurance. It’s affordable, transparent, and offers one of the highest coverage amounts for the lowest premium.

As we enter 2025, the importance of term insurance has skyrocketed. With rising healthcare costs, job uncertainties, and unpredictable economic changes, protecting your family’s future is non-negotiable.

This article, crafted for readers of moneyxmillionaire.com, will help you understand:

Why term insurance is the best financial safety net
The top term insurance plans in India (2025)
How to pick the right one for your needs
And how to save tax while building a strong financial base

Let’s dive deep into the world of term insurance plans and help you make the smartest financial decision of 2025.

What Is Term Insurance? (And Why You Need It)

Term insurance is the simplest and purest form of life insurance. You pay a small premium every year, and in return, your family gets a large lump sum (called the death benefit) if something happens to you during the policy term.

It doesn’t have complicated investment structures or hidden charges — just pure protection. Think of it as a financial safety belt for your loved ones.

Key Features of Term Insurance:

High coverage at a low cost (₹1 crore cover can cost as low as ₹700/month)
Tax benefits under Section 80C and Section 10(10D)
Multiple payout options (lump sum, monthly income, or a mix)
Add-on riders like critical illness, accidental death, and premium waiver

Term insurance ensures your family’s lifestyle, education, and goals continue seamlessly — even if you’re not around.

Why Term Insurance Should Be Your First Financial Priority

If you’re earning, term insurance should be your first investment, not your last. Here’s why:

Peace of Mind: Your family is financially secure, no matter what.
Debt Protection: Covers home loans, education loans, or personal loans.
Future Security: Helps maintain your family’s standard of living.
Tax Savings: Up to ₹1.5 lakh deduction under Section 80C and tax-free payout under Section 10(10D).
Low Cost, High Reward: Affordable premiums compared to traditional insurance plans.

💡 Pro Tip: Don’t delay buying term insurance. Premiums rise with age and health risks. Buying early locks in a lower rate for life.

Top 10 Best Term Insurance Plans in India (2025)

We’ve analyzed over 25 term plans based on affordability, claim settlement ratio, customer reviews, and features.

Here’s a list of the best term insurance plans in India for 2025 you can buy right now.

Rank	Insurance Plan	Claim Settlement Ratio (2025)	Unique Features	Approx. Premium (₹1 Cr Cover / 30-Year Term)
1	LIC Tech Term Plan	98.5%	Trusted brand, flexible premium payment, online plan	₹11,000/year
2	HDFC Life Click 2 Protect Super	99.3%	Income + lump sum payout, premium return option	₹10,200/year
3	ICICI Pru iProtect Smart	98.8%	Covers 34 critical illnesses, multiple payout options	₹10,500/year
4	Max Life Smart Secure Plus	99.5%	Option to increase cover with age, return of premium	₹9,800/year
5	Tata AIA Sampoorna Raksha Supreme	99.1%	Flexible payout, accidental death rider	₹10,100/year
6	SBI Life eShield Next	98.9%	Life cover + income replacement benefit	₹9,600/year
7	Aditya Birla Sun Life DigiShield	99.0%	Customizable protection options, 10 payout choices	₹9,700/year
8	Bajaj Allianz Life Smart Protect Goal	98.7%	Covers spouse, premium waiver, critical illness	₹10,000/year
9	Kotak e-Term Plan	98.2%	Pocket-friendly, simple online purchase	₹9,500/year
10	PNB MetLife Mera Term Plan Plus	98.4%	Option to cover spouse, child education protection	₹9,900/year

Premiums are indicative for a 30-year-old non-smoker male, as of 2025.

In-Depth Look at the Top Term Plans

1. LIC Tech Term Plan

LIC’s Tech Term Plan is a pure online term plan that offers simple protection and trust backed by India’s largest insurer.

Policy term: 10–40 years
Riders: Accidental benefit available
Payout: Lump sum or installments
Unique Benefit: Special rates for non-smokers and women
Why Choose: Legacy and reliability — LIC is unbeatable in trust.

2. HDFC Life Click 2 Protect Super

One of India’s best-selling digital plans in 2025, it offers flexibility, premium return options, and income payout models.

Coverage: Up to age 85
Add-ons: Critical illness, accidental death, waiver of premium
Highlight: Option to return all premiums at maturity
Why Choose: Great balance of affordability and protection

READ MORE:

3. ICICI Prudential iProtect Smart

Perfect for working professionals, this plan combines life cover + critical illness protection.

Covers 34 major illnesses
Offers terminal illness benefits
Tax benefits under Sections 80C & 80D
Why Choose: All-in-one coverage for health + life

4. Max Life Smart Secure Plus

A popular choice among young investors, it offers increasing cover as your income grows.

Increasing cover option (up to 200%)
Return of premium feature
Payout flexibility (lump sum or monthly income)
Why Choose: Dynamic plan that grows with your financial journey

5. Tata AIA Sampoorna Raksha Supreme

A plan designed for those seeking customizable term coverage.

Add riders for accidental death, terminal illness
Policy term up to 100 years
Flexible premium payment modes
Why Choose: Long-term coverage till lifetime

Key Factors to Consider Before Choosing a Term Plan

Picking a term plan isn’t just about finding the cheapest premium. You must ensure your family gets the best protection possible.

1. Claim Settlement Ratio (CSR):

Always choose an insurer with a CSR above 98%. It reflects reliability and faster claim processing.

2. Coverage Amount:

Your term cover should be at least 15–20 times your annual income. If you earn ₹10 lakh/year, go for ₹1.5–₹2 crore cover.

3. Policy Tenure:

Ideally, choose a policy term till retirement age (60–65 years).

4. Premium Payment Option:

You can pay annually, half-yearly, or even monthly. Choose what suits your budget.

5. Riders & Add-ons:

Boost your plan with accidental cover, critical illness, or waiver of premium riders.

6. Inflation Protection:

Some plans like Max Life Smart Secure Plus offer increasing cover options to beat inflation.

7. Insurer Reputation:

Stick to IRDAI-registered insurers with consistent performance.

Tax Benefits of Term Insurance (2025 Update)

One of the biggest advantages of buying term insurance is its tax efficiency.

Here’s how you save tax while securing your family:

Section	Tax Benefit	Limit	Applicable To
80C	Premiums paid for term insurance	Up to ₹1.5 lakh/year	Policyholder
80D	Premiums for critical illness rider	Up to ₹25,000/year	Self/family
10(10D)	Death benefits received by nominee	Fully Tax-Free	Nominee

💡 Pro Tip: Combine Section 80C and 80D benefits for maximum savings.

Common Mistakes to Avoid When Buying Term Insurance

Delaying Purchase: Every year you wait, your premium increases by 10–20%.
Choosing Insufficient Cover: Always account for inflation and family goals.
Ignoring Riders: Riders like accidental cover can double your protection.
Hiding Health Information: Never hide pre-existing conditions. Claims may get rejected later.
Not Reviewing Your Policy: Revisit your coverage every 5 years or after life milestones (marriage, kids, home loan).

Who Should Buy Term Insurance in 2025?

Term insurance isn’t just for married individuals. It’s a must-have for anyone with dependents or financial responsibilities.

✅ Working professionals with loans
✅ Parents with children
✅ Married couples
✅ Business owners
✅ NRIs with family in India

Even if you’re young and single, term insurance acts as a financial foundation — locking in low premiums for decades.

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Step-by-Step Guide to Buying the Right Term Plan

Assess Your Needs: Calculate current expenses, future goals, and liabilities.
Compare Online Plans: Use trusted aggregators or insurer websites.
Check CSR and Reviews: Ensure reliability and service record.
Choose Riders: Add protection for accidents or critical illnesses.
Disclose Truthfully: Provide accurate health and lifestyle info.
Pay Securely Online: Most insurers offer digital policy issuance.
Keep Nominee Informed: Ensure your family knows how to claim benefits.

Term Insurance Trends to Watch in 2025

The term insurance industry in India is evolving rapidly. Here are the top trends shaping 2025:

AI-driven Claim Approvals: Faster claim settlements using automation.
Health-Linked Premiums: Fitness tracking devices can lower premiums.
Customizable Payouts: Flexibility to mix lump sum and income options.
Digital-First Policies: Instant policy issuance with zero paperwork.
Women-Centric Plans: Special discounts and maternity-related riders.

Final Thoughts – Protect Today, Prosper Tomorrow

Buying term insurance is not about fear — it’s about responsibility and love.
It ensures that your family’s dreams don’t stop, even if life takes an unexpected turn.

In 2025, with so many flexible and affordable term plans, there’s no excuse to delay. Whether you’re starting your career or planning for retirement, term insurance gives you both financial peace of mind and tax savings.

Remember — wealth starts with protection. Investing without insurance is like building a house without a roof.

Secure your family today with the best term insurance plan that fits your budget and goals.

For more insights on smart money moves, visit moneyxmillionaire.com — your guide to smarter wealth, insurance, and financial freedom.

FAQs

1. What is the minimum age to buy a term insurance plan?
You can buy term insurance as early as 18 years old. The earlier you start, the cheaper your premium.

2. Can I increase my cover later?
Yes. Many plans like Max Life and HDFC Life allow step-up or increasing cover options as your income grows.

3. Are medical tests compulsory for term insurance?
In most cases, yes — to ensure accurate health evaluation and claim approval. However, some online plans may waive it for low cover amounts.

4. What happens if I stop paying premiums?
Your policy will lapse, and you’ll lose coverage. Some insurers offer a grace period to renew without penalty.

5. Is the death benefit taxable?
No. Under Section 10(10D), the death benefit is completely tax-free in the hands of the nominee.

6. Can NRIs buy term insurance in India?
Yes. NRIs can buy Indian term plans in INR or foreign currency, with the same benefits as residents.

7. What’s better — term plan or endowment plan?
Term plans offer pure protection at low cost, while endowment plans combine insurance and savings. Term plans are better for affordability and higher coverage.

8. Can I add my spouse under the same policy?
Yes, certain plans like PNB MetLife Mera Term Plan Plus allow joint coverage for couples.

9. What is the claim settlement ratio?
It’s the percentage of claims an insurer settles successfully. Choose insurers with a CSR above 98%.

10. How do I claim the insurance after the policyholder’s death?
Submit the death certificate, claim form, and policy documents to the insurer. Claims are usually settled within 30 days.

11. What is the ideal coverage amount for term insurance?

A good rule of thumb is to take coverage that is 15–20 times your annual income. So, if you earn ₹10 lakh per year, aim for at least ₹1.5–₹2 crore in life cover to ensure your family’s long-term financial security.

12. Can I change my nominee later?

Yes, you can update or change your nominee anytime during the policy term by submitting a written request or online update through your insurer’s customer portal.

13. What happens if I survive the policy term?

In a standard term plan, there’s no maturity benefit — it’s pure protection. However, some insurers offer “Return of Premium” options where you get back all premiums paid if you survive till the end.

14. Can I buy more than one term insurance policy?

Yes, you can hold multiple term plans from different insurers to diversify risk and manage different financial goals, as long as your overall coverage is reasonable based on your income.

15. Is online term insurance safe to buy?

Absolutely. Buying term insurance online is not only safe but also cheaper since you save on agent commissions. Always buy directly from an insurer’s official website or IRDAI-approved aggregator.

16. What is a ‘return of premium’ term plan?

It’s a type of term insurance where you get back all the premiums you’ve paid if you survive till the end of the policy term. It’s a bit more expensive but offers peace of mind and savings.

17. Can I buy term insurance without income proof?

Most insurers require income proof (like salary slips, ITR, or Form 16) to ensure the coverage amount is appropriate. It helps prevent over-insurance and claim disputes later.

18. What are riders in term insurance?

Riders are add-on benefits that enhance your basic policy. Common ones include Accidental Death Benefit, Critical Illness Cover, Waiver of Premium, and Disability Protection.

19. What is the difference between single premium and regular premium term plans?

A single premium plan requires a one-time payment upfront, while a regular premium plan lets you pay annually, quarterly, or monthly. Regular premiums are easier for salaried individuals to manage.

20. How does lifestyle affect term insurance premiums?

Factors like smoking, alcohol consumption, and high-risk occupations (e.g., pilots, miners) can increase premiums because of higher mortality risk. Non-smokers often enjoy special discounts.

21. Can senior citizens buy term insurance in India?

Yes, some insurers offer term plans up to age 65 or 70, though the premiums are higher. For seniors, shorter-term policies with limited pay options are recommended.

22. Is it necessary to take a medical test before buying term insurance?

Yes, for higher cover amounts, a medical test is required to assess your health condition. It ensures transparency and prevents claim rejections later.

23. Can I cancel my term insurance after buying it?

Yes, you can cancel within the free-look period (usually 15–30 days) and get your premium refunded after minimal deductions. After that, cancellation is possible, but you might not get a refund.

24. Can homemakers get term insurance?

Yes, homemakers can now get coverage through joint term insurance plans with their spouse or specific policies that consider family income rather than personal income.

25. What is the grace period in term insurance?

It’s the extra time (usually 15–30 days) given to pay your premium after the due date. During this period, your policy remains active, and claims are still valid.

✅ Pro Tip for 2025 Investors:

Always compare multiple term insurance plans online before buying. Even a ₹500 difference per month can save you ₹1–2 lakh over the policy term — that’s smart financial planning the moneyxmillionaire.com way.