How to Choose The Best Term Insurance Company in India

Term insurance is one of the most straightforward and cost-effective ways to secure the financial future of your loved ones. However, with numerous insurance providers offering a variety of plans, choosing the right one can be a daunting task. This is where understanding the best term insurance company in India becomes crucial.

Before we begin, let’s understand what term insurance is. Term insurance is a pure life cover policy where you pay premiums for a specific period (the term) in exchange for a large sum assured to your beneficiaries if something happens to you during the policy's tenure. Unlike other life insurance policies, term insurance doesn’t offer maturity benefits, but it provides high coverage at an affordable cost.

Given the importance of term insurance, selecting the right insurance company is essential. After all, this product is designed to safeguard your family’s future during your untimely demise. The credibility of the insurance provider plays a critical role in ensuring that your beneficiaries receive the promised amount promptly and without hassle. Several factors, such as the claim settlement ratio and timely claim approvals, underscore why making an informed decision about the insurer is crucial. Moreover, the period following a loved one's death is incredibly difficult, and having to deal with an unresponsive insurance company only adds to the emotional burden. Opting for a reliable insurer helps ease this grieving time by ensuring a seamless and fast settlement process. 

Now that we’ve established why selecting the right insurer is crucial, let’s move forward and explore the process of choosing the best term insurance company in India.

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Overview

Why Choosing the Right Term Insurance Company Matters?

Choosing the correct term insurance company is crucial for several reasons, particularly when considering the large sum involved and its financial risk.

• Financial Security
  Your term insurance plan is the safety net for your family in case of your untimely demise. However, ensuring that your chosen company has a strong claim settlement record and offers reasonable premiums aligned with your coverage needs is essential. A company with a poor claim settlement record or high premiums may not provide the coverage your family needs. Therefore, selecting a provider that ensures peace of mind, with reliable claims processes and affordable options, is essential. 
• Income Replacement
  Term insurance is intended to replace lost income, offering your family financial stability when you’re no longer around to provide. A reputable insurer with a strong financial track record is critical to ensure the policy effectively fulfills this role. If the insurer doesn’t honor its commitments or delays payments, it can significantly impact the financial well-being of your loved ones.
• Customer Support and Claims Processing: 
  Customer support and claims processing are key factors when choosing an insurer. A reliable insurer ensures that claims are processed smoothly and efficiently, providing your loved ones with the necessary assistance without unnecessary delays or complications. Excellent post-sale support is equally important, as it helps your family navigate the claims process during a difficult time. Opting for an insurer with strong customer service and a straightforward claims process can bring peace of mind, knowing your family will be supported when needed.

Now, let’s walk through the best term insurance companies in India and explain what makes these companies stand out.

Best Term Insurance Companies in India (2025)

Selecting the right insurer for your term insurance plan can be difficult with so many options available in the market. However, some companies have consistently stood out regarding their comprehensive offerings, claim settlement ratios, customer service, and flexibility. Here’s a breakdown of some of the best term insurance companies in India in 2025, along with their strengths and drawbacks:

1) Axis Max Life Insurance

Originally a partnership between Max India and New York Life, Max Life Insurance evolved over the years and is now a joint venture between Max Financial Services Ltd. (80%) and Axis Bank (20%). Established in 2000 as Max New York Life, the company, now known as Axis Max Life Insurance, has become one of the top players in India’s life insurance space. Known for its strong digital capabilities, Axis Max Life is highly regarded for offering flexible and innovative insurance solutions. The company emphasizes innovation, and its products are designed to be easily customizable to suit various life stages and financial goals. With a high claim settlement ratio, Axis Max Life ensures that claims are settled efficiently, making it a trusted choice for customers who value proactive financial protection and responsive customer support.

Metrics of Axis Max Life Insurance

Drawback: While Axis Max Life is known for its high claim settlement ratio, it has occasionally faced a higher volume of complaints compared to some other insurers. This could reflect the need for improvements in customer service or claims resolution efficiency.

2) Bajaj Allianz Life Insurance

Bajaj Allianz Life Insurance, a joint venture between Bajaj Finserv and Allianz SE, has established itself as a reliable and trusted provider of life insurance products in India. Founded in 2001, the company is known for its comprehensive range of term insurance plans that can be tailored to meet individual needs. The company’s digital platform allows customers to easily compare, purchase, and manage their policies, offering a seamless experience. Its transparent processes and strong customer support make Bajaj Allianz Life a solid option for those seeking affordability and flexibility in their life insurance plans.

Metrics of Bajaj Allianz Life Insurance

Drawback: Bajaj Allianz Life Insurance generally offers affordable and flexible plans; however, some customers find that the company's plans are less comprehensive than those of other insurers. This can be a limitation for individuals looking for broader coverage or more add-on options.

3) HDFC Life Insurance

Founded in 2000, HDFC Life Insurance is a joint venture between HDFC Ltd. and Standard Life Aberdeen (now Abrdn Plc), a UK-based investment company. Since Aberdeen’s exit in 2023, HDFC Life has operated independently, backed by the strong financial stability of the HDFC group. The insurer is known for offering flexible and affordable term insurance plans that cater to a wide range of customer needs. Moreover, HDFC Life has earned a reputation for reliability and trust. Customers appreciate its digital-first approach, making managing policies easy and submitting claims online. 

Metrics of HDFC Life Insurance

Drawback: While reliable and highly rated, HDFC Life's term insurance plans tend to be slightly more expensive than those of other insurers. This higher cost may be a factor to consider for budget-conscious individuals seeking affordable coverage.

4) Tata AIA Life Insurance

Tata AIA Life Insurance is a joint venture between Tata Sons, one of India’s most respected conglomerates, and AIA Group, a leading pan-Asian life insurance company. Established in 2001, Tata AIA Life offers a range of affordable and customizable term insurance plans. It is known for its customer-first approach, strong post-sale support, and efficient claims processing. Tata AIA Life offers various riders such as Critical Illness and Accidental Death Benefit, allowing policyholders to enhance their coverage. The company’s focus on affordability and solid financial backing from the Tata Group make it a popular choice for individuals seeking robust life coverage.

Metrics of Tata AIA Life Insurance

Drawback: While Tata AIA Life Insurance offers a solid range of products, its claim settlement ratio, though strong, falls slightly behind some competitors. This could be a concern for individuals who prioritize maximum reliability in claims processing.

5) ICICI Prudential Life Insurance

ICICI Prudential Life Insurance, established in 2000, is a joint venture between ICICI Bank and Prudential Corporation Holdings, a UK-based insurance and investment group. The company offers a range of customizable term insurance plans with flexible coverage options, making it suitable for various life stages and financial goals. It’s particularly popular among tech-savvy customers due to its seamless digital experience and transparency in the policy purchase process.

Metrics of ICICI Prudential Life Insurance

Drawback: ICICI Prudential Life has shown a relatively higher complaint volume in recent years than its peers. While it offers flexible policies and a strong digital platform, addressing customer grievances more efficiently could help improve its overall customer satisfaction.

What Makes an Insurance Company the Best?

When selecting a term insurance company, you should evaluate the following factors:

Claim Settlement Ratio (CSR)

The Claim Settlement Ratio (CSR) measures the percentage of claims an insurer settles compared to the total number of claims received. A higher CSR indicates an insurer's reliability in honoring claims, which is crucial for customers as it ensures financial protection in times of need. HDFC Life and Axis Max Life demonstrate exceptional CSR figures, with Axis Max Life leading at 99.5%, just slightly above HDFC Life’s 99.2%. This suggests that both companies are highly committed to fulfilling their customers' claims, significantly improving consumer trust. 

Solvency Ratio

The Solvency Ratio measures an insurer’s financial health, calculated by dividing its available capital by the required capital to pay all its liabilities. A ratio above the regulatory minimum indicates an insurer’s ability to withstand financial challenges and meet future obligations. The Insurance Regulatory and Development Authority of India (IRDAI) mandates a minimum solvency ratio of 1.5, which all the listed insurers (in the list of top term insurance companies in India) comfortably exceed. Bajaj Allianz Life, however, stands out with an unusually high solvency ratio of 5.1, indicating a powerful buffer, likely a result of prudent risk management and capital reserves.

Complaint Volume

Complaint Volume refers to the number of complaints an insurer receives per 10,000 claims. A lower complaint volume generally suggests better customer service and satisfaction. In this area, ICICI Prudential Life faces a relatively higher number of complaints, with an average of 14.3 complaints per 10,000 claims. On the other hand, HDFC Life and TATA AIA show lower complaint volumes of 2 and 3 complaints per 10,000 claims, indicating better customer satisfaction and smoother claims handling.

Amount Settlement Ratio

The Amount Settlement Ratio refers to the percentage of the total amount of claims paid out compared to the total amount of claims filed. A higher ratio indicates the insurer settling low and higher-value claims, an essential indicator of fairness and transparency. While anything above 90% is good, remember that the higher the better. On that note, Axis Max Life and ICICI Prudential Life lead with higher amounts settled, with ratios of 96.2% and 95.1%, respectively. This suggests that these insurers are very effective at paying out the claim amounts in line with what was requested. HDFC Life, though slightly lower at 93.9%, still performs strongly within the industry standard, highlighting a fair and efficient claims process.

Total Business Volume

Total Business Volume represents the premium collections an insurer generates over a period. It reflects the size and reach of the company in the market. HDFC Life leads with the highest business volume of ₹27,490 crore, indicating its strong market presence and customer base. Axis Max Life and Bajaj Allianz Life follow, with ₹9,296 crore and ₹10,456 crore in total premiums, respectively. These figures show that while HDFC Life has a clear edge in business volume, Axis Max Life and Bajaj Allianz Life are also substantial players in the market. ICICI Prudential Life, with ₹17,198 crore in premiums, is well-positioned, though its business volume is lower than that of HDFC Life.

Comparison of Top Term Insurance Plans from the Best Insurers

Let’s see how the best term insurance company in India compares to others on the basis of premiums, coverage options, and available riders for each plan. 

Note: For premium comparison, we’ve taken the example of a 30-year-old salaried male, non-smoker, living in Delhi, with a 35-year term insured for a sum of ₹1 Cr.

Disclaimer: The data is indicative as premiums are subject to periodic revision and vary with age, medical history, smoking/tobacco consumption habits. Please verify the latest premiums for accuracy.

How to Choose the Best Term Insurance Company in India for You?

When selecting a term insurance plan, evaluating several key factors will ensure you choose the most suitable option for your needs and circumstances. Here are the critical aspects to consider:

1) Age and Income

Your age and income are critical in determining the best term insurance plan for you. Younger individuals tend to have the advantage of lower premiums, making it an ideal time to lock in a longer tenure at an affordable rate. For those nearing retirement, shorter tenure plans with higher coverage may be more appropriate, ensuring your family is well-protected for a shorter period while also fitting your financial situation. Considering your income, you can choose a plan that doesn’t strain your monthly budget but still provides adequate coverage.

2) Family Size and Responsibilities

Suppose you have dependents, such as children or elderly parents. In that case, it’s crucial to select a plan offering higher coverage to ensure their financial security if something happens to you. For instance, if you have young children, you may want a plan with a larger sum assured to account for their education and future needs. Additionally, consider the coverage level that reflects your financial responsibilities towards your spouse and other family members. The goal is to secure a policy that will provide peace of mind and financial protection for those who rely on you.

3) Life Goals

Your life goals should play a significant role in shaping your term insurance plan. If you have plans to pay off a home loan, ensure the coverage amount is sufficient to clear the outstanding debt. For those with young children, it’s wise to choose a policy that can support their education in case of your untimely demise. Similarly, if you wish to support your spouse’s lifestyle, select coverage that ensures their financial independence and security in your absence. Aligning your term plan with these goals will help create long-term financial stability for your loved ones.

4) Riders and Flexibility

Riders are additional benefits that can be attached to your term plan, offering more comprehensive coverage. It's also essential to ensure that the insurer provides flexibility, allowing you to adjust your coverage as your circumstances change. For example, increasing coverage or adding more riders can offer greater financial security as your income grows or your responsibilities change (such as having children or paying off debts). Here’s a list of some of the riders that can be added to your term insurance plan

1. Waiver of Premium Rider: This rider waives the future premiums if the policyholder becomes critically ill or disabled, ensuring continued coverage without additional financial burden.
2. Critical Illness Rider: The Critical Illness rider provides a lump sum payout if the policyholder is diagnosed with a covered critical illness such as cancer, heart attack, or stroke.
3. Accidental Death Benefit: In case of accidental death, this rider offers an additional sum of money over and above the sum assured, providing extra financial support to the family.
4. Accidental Total and Permanent Disability Rider: This rider provides financial support in case the policyholder becomes permanently disabled, either by accident or illness, ensuring they don’t lose coverage due to income loss.
5. Terminal Illness Rider: This rider offers an early payout if the policyholder is diagnosed with a terminal illness, providing much-needed funds for treatment and other expenses.

5) Ease of Claims

An essential factor when choosing an insurance company is the ease of claims settlement. Select a company with a high claim settlement ratio, as this indicates that the company has a proven track record of efficiently processing claims. Additionally, ensure the insurer has a clear and transparent process for filing claims. A company known for fast, hassle-free claims ensures that your loved ones won’t struggle with paperwork and delays during a difficult time.

By considering factors such as age, income, family size, life goals, riders, and ease of claims, you can select a term insurance plan that best meets your unique needs, ensuring your family’s financial security and peace of mind.

Benefits of Buying from Top-Rated Insurers

Choosing a top-rated insurance company offers several advantages that ensure the best protection and peace of mind. Here are the key benefits:

Peace of Mind: 

Top-rated insurers are known for their proven track records in delivering reliable services. With companies that have consistently high claim settlement ratios and a strong financial background, you can be confident that your family's financial future is safe. This peace of mind comes from knowing that the insurer is stable, trustworthy, and capable of handling claims effectively in times of need.

Faster Claims: 

One of the benefits of choosing high-quality insurers is their faster claims process. Leading insurers have streamlined their claims management systems, ensuring that policyholders’ families can receive the sum assured without unnecessary delays. These insurers prioritize customer satisfaction by making the claims experience as seamless as possible, offering clear guidelines and digital tools to track and settle claims quickly. This efficiency can be crucial during a stressful time, allowing your loved ones to receive financial support when needed.

Stronger Post-Sale Support:

Top-rated insurers are committed to providing exceptional customer service long after purchasing the policy. Whether helping with policy updates, guiding rider options, or assisting in managing claims, these companies invest in building long-term relationships with their customers. Their post-sale support includes easy access to customer service representatives and self-service portals, ensuring you can get assistance whenever required. This continuous support makes it easier to navigate any questions or changes throughout the life of your insurance policy.

Lower Risk of Rejection: 

A key indicator of a quality insurer is a low claim rejection rate. Top-rated insurance companies maintain transparent and clear procedures, making it easier for customers to understand the terms and conditions of their coverage. With fewer claim rejections, these companies reduce the risk of financial hardship for your family in case of a claim. Their transparent policies and strong underwriting practices ensure that once you’re covered, your loved ones will be provided for without unnecessary hurdles.

By choosing a top-rated insurer, you gain financial protection and enjoy the benefits of reliability, customer-centric services, and a smoother claims experience. These factors collectively offer peace of mind, knowing that you and your family are well-supported by a company with a reputation for excellence.

Term Insurance Companies vs. Life Insurance Companies

While there is no strict distinction between term insurance companies and life insurance companies, since term insurance is a type of life insurance. 

However, the company's focus can vary, and this is where we can make a subtle distinction.

For example, 

• LIC (Life Insurance Corporation of India), one of the largest life insurers, strongly emphasizes endowment, money-back, and pension/annuity-based plans, with a comparatively smaller emphasis on term insurance products. 
• In contrast, companies like HDFC Life and Axis Life are also well-established life insurers but have a more prominent focus on term insurance. These companies offer comprehensive term plans alongside their broader product portfolio, giving customers more specialized options for term coverage.

In essence, while all life insurance companies offer term insurance, some are more focused on it, while others prioritize a variety of life insurance products.

Why Use Ditto to Compare Insurers

Choosing the right insurance plan is easier with Ditto. Here’s why:

• Transparent Comparisons: Ditto offers a clear comparison of different term plans based on premiums, coverage, and riders.
• Expert Help: Our team helps you navigate through the confusing terms and conditions of different policies.
• Claim Data and Product Clarity: Ditto gives you access to data on insurers’ claim settlement ratios and other essential metrics.

Buy the Right Term Insurance Plan Through Ditto

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Conclusion

When looking for the best term insurance company in India, it’s essential to weigh multiple factors such as claim settlement ratios, solvency ratios, and premium costs. The top 5 term insurance company in India offer varying features and benefits, so make sure to compare them thoroughly. You can also use the policy comparison tool on our (Ditto’s) website. 

Choosing the best term plan company in India requires thoughtful consideration of your financial goals, family responsibilities, and the company’s reputation in the industry. Companies like HDFC Life, ICICI Prudential, and Axis Max Life are often cited as the best term insurance companies in India, owing to their strong financial health, excellent claim settlement ratios, and customer satisfaction levels.

FAQs: Best Term Insurance Company in India