There is no one price for peace of mind. However, if you consider your family’s future, particularly after your passing, financial independence becomes indispensable. That is where a term insurance cover of ₹1 crore comes into the picture.
Over the years, numerous first-time policy owners and working professionals have started their insurance journey with a 1-crore policy. Be you a single income family, a new parent, or simply looking for long-term goals, the best term insurance plan for 1 crore provides you with affordability and maximum protection.
Let’s discuss how it works, who might want to consider it, and why a straightforward online tool such as the term insurance calculator can assist you in comprehending its full worth.
Understanding the 1 Crore Term Insurance Plan
If the policyholder passes away during the policy term, the nominee gets a payout of ₹1 crore. That’s the sum assured. This amount can help take care of home loans, school fees, monthly bills, and even future financial goals like higher education or marriage expenses.
And here’s the good part: the premiums are surprisingly low because it’s a pure term plan (not a savings plan). For example, a healthy non-smoking individual in their late 20s can get covered for around ₹1,200 a month.
You don’t have to wait long to know your premiums either. That’s where the term insurance calculator comes in. It’s a free tool available on most insurance companies like Axis Max Life Insurance. You fill in your basic details like name, age, income, smoking habits, and it gives you an estimate in seconds.
What Else Does a 1 Crore Term Plan Offer?
When you pick a high-cover term plan, you don’t just get a death benefit. You also get the chance to customise it with add-ons, also known as riders. These are optional features that offer enhanced protection.
Here’s where you should pay attention. Insurers offer critical illness covers, disability protection, and accidental death riders. So, in case you’re diagnosed with a major illness, or face a temporary or permanent disability, these riders can give a lump sum payout, helping you manage treatment and other expenses.
Is It Worth Choosing Rs. 1 Crore or Should You Look Higher?
A ₹1 crore plan is a decent choice for most individuals. But whether it’s right for you depends on your lifestyle, income, and financial responsibilities. Here’s a practical way to decide: calculate your current annual income, multiply it by 10, and add your total outstanding liabilities. If that amount crosses ₹1 crore, you might want to look at a higher sum assured like ₹1.5 or ₹2 crore.
Alternatively, start with ₹1 crore and increase your cover later as your income grows. Some term plans allow step-up benefits, where the cover increases automatically at certain life stages like marriage or childbirth.
How Does a Term Insurance Plan Actually Work?
When you buy a term insurance plan, say for ₹1 crore, you’re entering into a contract with your insurer. You agree to pay a fixed premium regularly, and in return, the insurer promises to pay your nominee the sum assured (₹1 crore in this case) if anything happens to you during the policy term.
If you outlive the term, there’s no payout unless you’ve chosen a term plan with premium return, in which case, you get back all your premiums at maturity. This simplicity makes term insurance one of the most practical financial tools available.
The payout is completely tax-free under Section 10(10D) of the Income Tax Act, 1961. Meanwhile, the premiums you pay are eligible for deductions under Section 80C.
Features You Should Look For
When you’re looking for the best term insurance plan for 1 crore, it’s easy to get distracted by just the premium amount. But there’s more to it than that.
Always check if the insurer offers:
- Quick claim settlement: Some leading insurers promise settlement in as little as 3 hours after claim intimation.
- Strong claim settlement ratio: Anything above 95% is considered good. Premium insurers like Axis Max Life Insurance have maintained a consistent 99.65%, which speaks volumes.
- Rider options: We’ve mentioned this before, but it’s worth repeating. Riders like critical illness, accidental death, or waiver of premium are worth exploring.
- Flexible premium payments: Choose from monthly, quarterly, or annual options. You can also opt for limited pay or regular pay, depending on your cash flow.
- Joint life cover: A smart choice for couples, especially if both are earning and want to protect each other under a single plan.
Who Should Consider a ₹1 Crore Term Plan?
To be honest, almost everyone. But there are a few profiles where this amount of coverage makes even more sense. If you’re:
1. In your 20s or early 30s: You can lock in a low premium now and enjoy a long tenure of protection. You’ll pay less for more cover.
2. A sole earner: Your absence would directly affect your family’s finances. A 1 crore term cover can take care of daily expenses, EMIs, education, and much more.
3. Managing loans: Got a home loan or business loan? A term plan ensures those liabilities don’t become your family’s burden.
4. Planning big goals: Children’s higher education, marriage, or just keeping your partner financially independent, it all needs long-term funding.
The idea is not just about having a number like “1 crore” in your policy. It’s about matching your life cover to your family’s actual needs.
Is the Term Plan with Premium Return Worth It?
This is a common debate and there are 2 aspects to consider. Let’s say you buy a term plan with premium return. It costs more, but if you survive the term, all your premiums are returned to you. It is a mix of protection plus savings. You don’t lose your money if you don’t make a claim.
On the other hand, if your goal is to get maximum cover at the lowest cost, a regular term plan will suit you better. Choose based on your comfort level with premium outflows and whether you’d prefer a refund if all goes well.
Final Word
Getting a 1 crore term insurance plan isn’t about overplanning. It’s about making sure your family can live with dignity, even in your absence. Whether you choose a basic plan or go for a term plan with premium return, the key is to act early, choose wisely, and review your cover every few years.
Many premium insurance providers, like Axis Max Life Insurance, offer plans with high claim settlement ratios, added features like critical illness riders, and even options to get your premiums back if you survive the term. So, take that first step. Use a term insurance calculator to get a sense of your premium. Compare your options, and pick a plan that not only suits your budget but also your responsibilities.
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Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.
Also Read: How to Prepare for Your Future and Achieve Financial Stability
