How to Choose Term Insurance & Find the Right Term Plan.
- Posted On: 05 Feb 2026
- Updated On: 10 Feb 2026
- 24 Views
- 1 min read
https://www.shriramlife.com//blog/advice/how-to-choose-term-insurance-and-find-the-right-plan
Table of Contents
How to Choose Term Insurance?
The biggest mistake people make while choosing a term insurance plan is relying on friends’ or colleagues’ advice. In fact, 47.6% of the Indian population is still unaware of term insurance and its benefits, often leading to inadequate coverage that can cost families thousands over time.
What works for someone else may not work for you, because term insurance must be tailored to your income, liabilities, dependents, and long-term financial goals.This is why choosing the right term insurance really matters.
Follow This Checklist Before Choosing a Plan
- Coverage amount: Ideally, 10 to 15 times your annual income, adjusted for loans and future expenses.
- Policy duration: Should extend through your key earning years, usually up to age 60 or 65.
- Affordability: Term life insurance premiums must remain manageable over the long term.
- Riders: Select only relevant add-ons like critical illness or accidental death benefits.
- Medical disclosures: Full transparency helps ensure a smooth claims process.
Once you have clarity on your checklist, the next step is choosing the right term plan. Explore Shriram Life’s term insurance and protect your family’s future. |
What Are the Different Types of Term Insurance Plans
Choosing the right type of term plan depends on your life stage and responsibilities. The table below explains the major options clearly:
| Type of Term Plan | What it Means | Best Suited For |
| Level Term Insurance | Coverage amount remains fixed throughout the policy term. |
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| Increasing Term Insurance | Sum assured increases over time to match rising responsibilities. |
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| Decreasing Term Insurance | Coverage reduces gradually as liabilities decrease over the policy term. |
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| Term Insurance with Return of Premium (TROP) | Premiums paid are returned if the policyholder survives the policy term. |
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| Whole Life Insurance | Provides life cover for the policyholder’s entire lifetime. |
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How to Choose the Right Insurance Company
While selecting the best term insurance company in India, you should look beyond the premium cost.
- Consistent claim settlement performance
- Transparent policy terms
- Strong customer support
- Long-standing industry presence
They are key indicators of reliability.
FAQs
What is the 3-year rule in term insurance?
As per Section 45 of the Insurance Act, 1938, insurers generally cannot reject a claim after three years of policy issuance unless fraud is proven. During the first three years, claims can be reviewed for incorrect disclosures.
What is the best age to buy term insurance?
Buying term insurance in your 20s or early 30s is ideal, as premiums are lower and coverage can continue for a longer period.
What Is Term Insurance and How Does It Work? | Shriram Life
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