India's best life insurance plans

Unsung heroes rarely get the attention they deserve. They do their job better, are the lifeblood of any ecosystem, but remain criminally hidden in plain sight. The good-old life term plans are one such example. If someone received secondary treatment, it was them. But that's all. about to change now.

- Ashish Menon, Omkar Vasudev Bhat, Sahiba Kaur Arora & Ravi Banagere. Inputs from Maushami Singh.

Thanks to this year's Union Budget, the government will impose a tax on proceeds of life-insurance plans with a premium value of over ₹5 lakh. With one blow, the government has broken the back of the insurance industry's popular (though inferior) vehicle - moneyback/ endowment plans. 

Unit-linked insurance plans (ULIPS) the third wheel of the life-insurance industry escaped the hammer this time, as the provision to tax returns from ULIPS with a premium of more than ₹2.5 lakh has already been introduced in 2021. ULIPS are structurally flawed and offer poor returns to investors. Bluntly speaking, they are useless. That's another reason why term plans should be your go-to option. Although poorly promoted by insurers and distributors due to slim commissions, their merits far outweigh those of ULIPS and endowment plans. Term plans help you get a large cover at a low cost. Thankfully, the turf war is on the verge of getting settled and the cream of term plans is finally rising to the top.

How we decided on the best

Since there are 24 life insurers, we thought we would make your life easy by distilling the best term plans for you. We restricted our research to only pure term plans which offer sufficient flexibility in (a) sum assured and (b) policy tenure, and (c) which provided the regular premium-payment option. We also ensured the insurance company had an adequate track record. Finally, to ensure their premiums can be compared easily, we limited ourselves to only those insurers that offer online term plans.

A total of 19 plans across 15 insurers made the cut. We eliminated them based on the first and second criteria below and ranked them on the basis of the third:

1. Claim-settlement ratio and benefit amount were important metrics to decide an insurer's track record of honouring claims in a timely fashion.