Insurance is an important component of your financial planning for the simple reason that it is a means to protect your family from uncertainties of life, as well as enjoy the benefits of investment to create wealth in the long run. It is not a question of whether a life insurance policy is to be bought at all, but when. It is one instrument that gains priority over all others when an individual initiates investment as a part of his long-term financial strategy with definite objectives and goals in mind.
Keeping the basic concept of investment intact, life insurance companies in India have evolved to offer plans that offer a variety of options that are almost tailor made for most individuals. And then there are a host of insurance companies operating in India. Where to invest and what plan to choose requires meticulous analysis on your part to finally repose faith on the policy that best suits your needs.
What is Life Insurance?
Life Insurance is a contract for a specified tenure between you and the insurance company which promises to pay an agreed upon amount in lump sum as “Death Benefit” to your beneficiary in the event of your demise, or on your survival a “Maturity Benefit” depending on the terms of the policy after the completion of policy term To keep your policy live, you are required to pay a predetermined amount as premium in specified intervals.
Why is a good Life Insurance Company important?
There are presently 24 life insurance companies in India, offering a variety of plans each, which confuses you with its multiplicity of features, making your choice a very complex one. The solution is to approach the problem methodically to first choose the best life insurance companies in India and then make a choice of your ideal policy.
What are the parameters for a good Life Insurance company?
There are a few rules which will help you to sift the best life insurance companies in India amongst the galaxy operating in this industry.
- Claim settlement ratio: This is one parameter of prime importance that will give you an insight into the operational efficiency and financial strength of the insurance company and if it can be trusted.
- Analyze your financial status: Since a policy will protect your family in your absence, you must assess your assets and liabilities and projected milestones in different stages of your life in relation to your current and future earnings. This will help you compare the plans better.
- Compare plans: Every Insurance company offers a bouquet of plans to meet the demands of the clients. Check for the types of plans and their benefits to match your needs with your age, objectives and your projected time horizon.
- Rider Benefits: You are in a position to augment your cover with specific needs with the help of riders. Look for those that match your needs.
- Inflationary factor: Check for the returns in relation to the inflationary trends in consonance with your timelines and how they cope with it.
- Service Quality: Best insurance companies in India dish out an array of services for the comfort and ease of the policyholder. Check for the following:
- Good portal supporting all online activities.
- Seamless claim settlement process.
- Facility for fund switch.
- Facility for policy alterations.
- Online policy and profile management.
Top 10 Life Insurance Companies in India
Conforming to the above parameters, a list of top 10 life insurance companies in India has been arrived at.
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LIC of India:
Life insurance has become synonymous with this most trusted brand. It is a public sector undertaking headquartered in Mumbai. They have the best settlement ratio at over 98% and by far the most dominant player in the industry.
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SBI Life Insurance:
Headquartered in Mumbai, it is a combined undertaking between SBI and BNP Paribas Cardiff in the ratio of 74:26, making it a potent player in the market. It holds an edge with their presence in the banking sector of the country.
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Birla Sun Life Insurance:
A combined undertaking between the Aditya Birla Group and the Sun Life Insurance boasts of a good network and one of the most innovative plans in the market. It is also reputed to be the pioneer in introducing ULIP in the insurance arena.
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Reliance Nippon Life Insurance:
Since its inception in 2001, this Navi Mumbai based company has been able to acquire a niche place for itself in the life insurance industry. Apart from a good claim settlement ratio, their grievance resolution is 99%.
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Tata AIA Life Insurance:
A combined undertaking between the globally renowned Tata Group and AIA, one of the major life insurance giants in the world, was established in 2001 and operates from Mumbai. They enjoy a 100% grievance resolution ratio.
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ICICI Prudential Life Insurance:
It is the first private sector insurance company in India which began operation in 2000 as a combined undertaking between ICICI and Prudential Plc, UK. They are a popular brand amongst its clients with some innovative plans like Wealth Builder II.
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Bajaj Allianz Life Insurance:
It is headquartered in Pune and earned a name for itself by customization of its products and transparent benefits offered for a wide range of clientele spread across ages and diverse income groups.
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Max Life Insurance:
They are in India since 2000 and operate out of New Delhi. They have a reputation of 100% grievance resolution. Their term plan offering a cover of Rs.1 Crore is very popular.
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HDFC Standard Life Insurance:
Among one of the top private insurance providers, they are headquartered in Mumbai. They boast of a good network with the HDFC channel open to them. They have some remarkable sought-after products in their bouquet.
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PNB Metlife India Insurance:
It is a combined undertaking between PNB, a public sector banking giant and Metlife, a global brand. They boast of a good presence through their large network and are known for offering cost-effective plans that suit the customers.
Bottom Line:
The choice of top 10 insurance companies in India is a complicated task, not so much at the top but on the lower end. There are companies that may swap places from year to year based on performances. In other words, the difference between them is wafer thin and the position is only relative.
