Your family's security shouldn't depend on your presence.
Term insurance is the simplest, most affordable way to make sure the people who depend on you are financially protected — no matter what life brings.
₹1 Cr+
Cover available for as little as ₹500–700 per month if you start early
97%+
Claim settlement ratio of leading term insurers in India
80C
Section under which premiums qualify for tax deduction up to ₹1.5 lakh under the old tax regime
0 Tax
Death benefit received by nominee is fully tax-free under Section 10(10D)
The Basics
What exactly is term insurance?
Term insurance is the purest form of life insurance. You pay a fixed premium for a defined period, and if you pass away during that time, your nominee receives a lump sum payout. There is no investment component, no maturity benefit, and no savings angle.
That simplicity is its strength. Because the policy is built entirely around protection, it offers extraordinarily high coverage at a fraction of what traditional life insurance products cost.
Think of it as income insurance for your family. It doesn't build wealth — it protects the wealth, lifestyle, and financial plans your family has come to depend on.
Buying early matters enormously. Premiums are locked in at the age of purchase, and a clean health profile at a younger age means smoother underwriting, fewer exclusions, and long waiting periods completing while you are still healthy.
How Term Insurance Works
Choose your cover amount — known as the sum assured — based on your income, loans, and family's needs.
Pick your policy term — typically until age 65–70, when most financial responsibilities wind down.
Pay your premium regularly — monthly, quarterly, or annually. Premiums stay fixed for the entire term.
If you pass away during the term, your nominee receives the full payout — lump sum, monthly income, or a combination.
If you outlive the policy term, it means your loved ones stayed protected throughout, exactly what the cover was designed to do.
Why Term Insurance
Six reasons term insurance belongs in every financial plan.
Most people spend years carefully building a financial future for their family. Term insurance is what protects that future when you're no longer around to do it yourself.
Income Replacement
Your family depends on your earnings today. Term insurance ensures that income is replaced instantly upon your absence, so their lifestyle, goals, and daily needs remain unaffected.
Loan & Debt Protection
A home loan, car loan, or business debt doesn't disappear when you do. Term insurance ensures your family can repay outstanding liabilities without selling assets or depending on others.
High Cover at Low Cost
Because term insurance is pure protection with no savings component, it offers the highest coverage per rupee of any life insurance product. A ₹1 crore cover can cost well under ₹1,000 a month if bought early.
Premiums Stay Fixed
Once your policy is issued, your premium is locked in for the entire term — regardless of future health changes or age. This makes long-term financial planning far more predictable.
Protects Life Goals
Your child's education, your spouse's retirement, a planned home — these goals don't pause if you're gone. Term insurance ensures the financial runway to see them through.
Significant Tax Benefits
Premiums qualify for deduction up to ₹1.5 lakh under Section 80C (old regime), and the death benefit received by your nominee is completely tax-free under Section 10(10D).
Plan Types
Not all term plans work the same way.
Term insurance comes in several variants — each suited to a different financial situation or life stage. Understanding the differences helps you choose the structure that actually fits your needs.
Most Common
Level Term Plan
The sum assured remains fixed throughout the policy term. Premiums are constant and predictable. If you choose ₹2 crore cover for 35 years, your nominee receives ₹2 crore whether the claim arises in year 1 or year 35. The most straightforward and widely recommended structure.
Inflation Protection
Increasing Term Plan
The cover amount grows each year or at set intervals, helping keep pace with inflation and rising financial responsibilities over time. Premiums are higher than a level term plan, but the protection grows along with your commitments.
Loan-Linked
Decreasing Term Plan
The sum assured reduces each year, designed to mirror a declining liability such as a home loan. As you pay down your debt, the cover reduces proportionally. Best suited for those whose primary concern is loan protection rather than broader income replacement.
Premium Return
Return of Premium (TROP)
If you survive the policy term, the base premiums paid are returned to you. It addresses the "I get nothing if I survive" concern, but comes at a significantly higher premium — often 80–100% more than a standard term plan. Best evaluated carefully against the pure investment of that additional cost.
Add-On Riders
Enhance your cover with the right riders.
Riders are optional add-ons that extend your base term policy for an additional premium. Choose only the ones that genuinely add value to your specific situation.
Critical Illness Rider
Pays a lump sum on diagnosis of specified serious illnesses like cancer, heart attack, or kidney failure. The payout helps cover income loss and recovery costs that health insurance may not fully address.
Waiver of Premium Rider
If you suffer a defined disability or critical illness that affects your ability to earn, future premiums are waived entirely while your life cover continues without interruption.
Terminal Illness Benefit
Provides an accelerated payout if you are diagnosed with a terminal illness — giving you access to funds while you're still alive to manage treatment costs and make end-of-life arrangements.
Accidental Total & Permanent Disability
Pays out if an accident results in permanent disability that removes your ability to earn. This covers a gap that life cover alone doesn't address — when death doesn't occur but income is lost permanently.
Coverage Scope
What term insurance covers and what it doesn't.
Understanding inclusions and exclusions upfront avoids surprises at claim time. Coverage can vary by insurer, so always read the policy document carefully.
What Is Covered
Natural death from illness or disease
Death due to critical or terminal illness
Accidental death
Death due to natural disasters or pandemic
Death during surgery or medical treatment
What Is Not Covered
Suicide within the first policy year
Death due to undisclosed hazardous activities
Death linked to substance abuse or intoxication
Death while committing a criminal act
Claims rejected due to material non-disclosure
Full and accurate disclosure at the time of purchase is critical. After three continuous years, insurers generally cannot reject claims except in cases of proven fraud — making transparency during onboarding the single most important step in securing a clean claim experience.
How Much Cover Do You Need?
There is no single right answer. But there is a right method.
The right sum assured depends on your income, monthly expenses, outstanding loans, number of dependents, and long-term goals. Here are the key factors that shape your ideal coverage.
10–15x
A common starting benchmark is 10–15 times your annual income — though actual needs can be higher based on liabilities
65–70
Ideal age to hold term cover until — most financial responsibilities and liabilities are resolved by this point
+Loans
Always add outstanding loans — home, vehicle, business — to your base cover calculation. Debt doesn't disappear with you
If you already have an existing life insurance cover, you can subtract that amount from your total required coverage. The goal is adequate protection — not over-insuring and paying unnecessarily high premiums.
Tax Benefits
Protection that also reduces your tax burden.
Term insurance offers meaningful tax advantages — both on the premium you pay and on the payout your family receives.
Section 80C Deduction
Premiums paid towards a term insurance plan qualify for a deduction of up to ₹1.5 lakh per year under Section 80C of the Income Tax Act (applicable under the old tax regime).
Section 10(10D) — Tax-Free Payout
The death benefit received by your nominee is completely tax-free under Section 10(10D) of the Income Tax Act, under both old and new tax regimes. There is no tax deduction at source on claim payouts.
Section 80D — Health Riders
If your term policy includes a health-related rider such as critical illness cover, the additional premium paid for that rider may qualify for a deduction under Section 80D, over and above the 80C limit.
Get Covered Today
The best time to buy was yesterday. The next best is now.
Every year you delay, premiums go up and health risks increase.
Let DhanONE help you find the right term plan for your life.
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