LIC Online Term Plan: How it is Different From Other Companies

Author: Anumeha Singh

LIC has recently launched its online term insurance plan which is known as the e-Term plan. Unlike almost every other LIC term plan, the pricing of the e-Term is quite competitive. Generally LIC insurance plans are the most expensive and this company was known to avoid cheap term plans. The offline term plan offered by LIC is at least 30-40% costlier than its nearest competitor and in spite of this majority of people preferred LIC. The main reason behind this is the unblemished reputation of the company and the government backing it receives. However, there is a catch in the cheap LIC online term plan and it is beneficial only if the cover is for more than 50 Lakh. We will discuss this fact later.

Features of the e-Term Plan

The best part is that in this plan you do not need to take the assistance of LIC agents as you can simply apply for it online.

  • You can take the insurance policy only through the official website of LIC India
  • You do not get any maturity amount as this is a pure term insurance plan
  • The minimum sum assured should be 25 lakh while there is no upper limit
  • The online term plan e-Term is cheaper than the offline plan known as Amulya Jeevan
  • You can pay the premium annually only
  • You can take the insurance cover only for yourself
  • There are no riders available with the e-Term plan
  • The minimum policy term is 10 years and the maximum term is 35 years
  • The entry age is minimum 18 years and maximum 60 years
  • Maximum age for insurance cover is 75 years
  • The premium has to be paid through the online method

Aggregate and Non Smoker Category

It appears as if LIC does not want to encourage the low income group for this plan. If the sum assured is below 50 Lakh the premium is pretty high. This is because if you take the plan for less than this amount the premium will be same as that charged to a smoker. This will amount to being only 16.5% less than the offline term plan of LIC. Hence interestingly it is cheaper to opt for a higher sum assured.

e-Term and Other Online Term Plans

It is not a surprise that the premium of the e-Term is not the maximum. For instance, ICICI Pru iCare charges a higher premium compared to the LIC term plan available online. However this plan is the costliest for non smokers if the sum assured is less than 50 lakh. HDFC Click2Protect is cheaper than the LIC e-Term plan. All other insurance companies charge lower premium compared to these three which are the leaders in the life insurance market.

Ease of Subscribing

Subscribing to LIC Term plan can be a little tough because it is tiring to find the online form. There will be verification on many steps and you will have to provide a lot of unnecessary information. In fact some people think that this is a tactic to demotivate people from opting for the online Term plan.

Tenure and Age Conditions

The LIC Term Plan Offers More Flexibility when it comes to tenure and age. No other plan in the market provides the opportunity to have a term plan till the age of 75 years.

Should You Opt for e-Term if You are a New Customer

There is no doubt that LIC e-Term is a superior online term insurance plan. With this plan you get the opportunity to get term insurance till the age of 75 years. This is in addition to the fact that LIC is the most trusted insurance company of India as it is backed by the government of India which makes it the most reliable insurance company in the country. The only factor against it is the higher cost although it is not the most expensive plan.