Digit Glow Term Life Insurance

0% GST on Premium

Date of Birth

Annual Income (In Lacs)

Mobile Number +91

I agree to the Terms & Conditions

Written By

Fathima Tabasum

Reviewed By

Ashok Manwani

Term Insurance Plan for 50 Lakh Online in India

A 50 lakh term insurance plan is a way to ensure your family's financial security if something happens to you. It's a pure protection policy offering a substantial sum assured at affordable premiums, promising a large payout if you pass away unexpectedly. This kind of insurance helps your family cope with financial challenges without struggling.

Let’s discuss a 50 lakh term insurance plan: how it works, its benefits when it’s helpful, and, most importantly, whether it’s enough for your needs.

50 Lakh Term Insurance Plan Overview

Here’s a table summarising the key aspects of a 50 lakh term insurance policy:

Feature	Description
Sum Assured	₹50 Lakhs
Purpose	Provides financial security to the family in case of the policyholder’s demise
Eligibility	The average annual income of ₹3 lakhs or more per year.
Premium	Lower premiums due to the lower sum assured
Riders/Add-ons	Options like critical illness, accidental death, waiver of premium, etc.
Premium Payment Options	Monthly, quarterly, half-yearly, or annual
Tax Benefits	Premiums paid are eligible for tax deductions under Section 80C of the IT Act

What is a 50 Lakh Term Insurance Plan?

Term plans are the most basic form of life insurance that pay a death benefit in case of life assured’s demise in return for a premium paid. They do not have any savings component and hence do not pay any survival benefit.

A 50 lakh term insurance policy pays a death benefit of 50 lakh in case of the life assured's unfortunate demise.

This death benefit amount must cover all the lost income that the life assured would have earned if they were alive. It must also cover the family’s liabilities, current financial requirements, and future goals. Thus, evaluating the required sum assured while buying a term plan is imperative.

How Does a 50 Lakh Term Insurance Plan Work

Term Insurance Plan is the essential component of any healthy financial portfolio. More than an investment option, it is a financial tool that secures your family's financial future and provides you with much-needed mental peace. A term insurance plan with a sum assured of 50 lakhs works as follows:

Coverage Amount

The plan provides a sum assured of 50 lakhs, which is the amount your beneficiaries will receive in the event of your death during the policy term.

Policy Term

This is the duration for which the insurance is active. Depending on the plan, it can vary from 5 to 30 years or more.

Premiums

You pay regular premiums (monthly, quarterly, semi-annually, or annually) to keep the policy active. The premium amount is based on age, health, and policy terms.

Death Benefit Payout

If the policyholder passes away during the policy term, the nominee receives the sum assured of 50 lakhs.

Rider Benefits

Some plans offer additional riders, such as accidental death benefits or critical illness coverage, for an extra premium.

Tax Benefits

Premiums paid for term insurance can qualify for tax deductions under Section 80C of the Income Tax Act, and the death benefit is tax-free under Section 10(10D).

Benefits of 50 Lakhs Term Plan

A 50 lakh term insurance plan provides substantial financial coverage to the policyholder's beneficiaries during their untimely demise. Here are the benefits:

High Sum Assured

Provides a significant payout of ₹50 lakhs to beneficiaries in case of the policyholder’s death.

Financial Security

Ensures financial stability for family members or dependents by covering essential expenses.

Affordable Premiums

Term plans generally offer higher coverage at relatively lower premiums than other policies.

Tax Benefits

Premiums paid are eligible for tax deductions under Section 80C of the Income Tax Act.

Customisable Coverage

Policies can often be tailored with riders for additional protection, like accidental death benefits.

Loan Protection

Can cover outstanding loans or debts, preventing financial burden on the family.

Long-Term Coverage

It covers the entire term, which can be as long as 30-40 years, depending on the policy.

Simplicity

Straightforward and easy to understand, with no investment component, focusing solely on protection.

Illustration of 50 Lakh Term Insurance Plan

Mr Kamat, a 40-year-old businessman, decided to secure his family's future. He learned about term insurance and was particularly interested in a plan that would provide a sum of ₹50 lakhs if something happened to him. After discussing with an insurance advisor, he purchased a ₹50 lakh term insurance policy.

Kamat has been committed to paying a premium of ₹15,000 annually for 20 years. He set up an auto-debit system to ensure he never missed a payment. The premium was deducted from his bank account each year, and he received a confirmation from the insurance company.

Real-Life Scenarios to Better Understand ₹50 Lakh Term Insurance

Scenario 1

Scenario 2

Unexpected Event

If Mr Kamat passes away during the policy term, the insurance company quickly processes the claim, and within a few weeks, ₹50 lakhs are transferred to Mr Kamat’s family. With the ₹50 lakhs, Mr Kamat’s family manages their finances comfortably. They pay off debts, ensure their children's education, and secure their future.

On Survival

If Mr. Kamat survives the entire policy term, he would have simply stopped paying premiums after 20 years, and the insurance policy would have expired without any payouts.

Disclaimer: The above illustration is a hypothetical example created for educational purposes only and does not represent a real-life scenario.

Is a 50 Lakh Term Insurance Plan Sufficient for You?

Case 1

Case 2

Why 50 Lakh Coverage is Sufficient for Rohan

Rohan is a 35-year-old software engineer who lives with his wife, Priya, and their two young children. His annual income is ₹12 lakhs, and he has diligently managed his finances. They own a modest home with a mortgage, and Rohan has saved up educational and emergency funds.

Rohan decides to buy a 50 Lakh term insurance plan. He aims to protect his family financially if something happens to him.

Given their current financial stability, Rohan’s term plan provides:

Mortgage Coverage: ₹50 lakh is enough to cover the outstanding mortgage, ensuring Priya can continue living in their home without financial strain.

Education Fund: The amount would also cover the children's education expenses until independence.

Emergency Fund: It ensures Priya has a safety net to manage daily expenses and unexpected costs for a few years.

The 50 Lakh coverage for Rohan is sufficient, as it meets his family's immediate financial needs and long-term goals.

Why 50 Lakh Coverage Falls Short for Aman

Aman, age 40, is a successful businessman with a significantly higher annual income of ₹25 lakhs. He has a large home with a high-value mortgage, a diverse investment portfolio, and substantial future financial commitments, including his children's higher education and business expansion plans.

Aman opts for a 50 Lakh term insurance plan. However, considering his financial situation:

Mortgage Coverage: The ₹50 lakh coverage is inadequate to settle his large mortgage fully.

Business Continuity: His business requires additional funds to ensure smooth operations and cover potential losses in his absence.

Education and Future Planning: The amount must be sufficient to cover the substantial funds required for his children's higher education and other long-term goals.

Aman does not need a 50 Lakh term insurance plan. He needs a higher coverage amount to fully protect his family’s financial future and meet all his financial commitments.

Note: The one golden rule to having sufficient coverage is to “Review Your Term Insurance Every 5 Years” to cover all your increased liabilities and expenses.

A common guideline is coverage equal to 10 times one's annual income. However, this rule might only sometimes be sufficient with inflation and evolving lifestyle needs. For a more precise calculation, consider the Human Life Value (HLV) method

Who Should Buy a 50 Lakh Term Insurance Policy?

Any individual with financial dependents, such as a spouse, parents, retirees with liabilities, or business people with financial liabilities, must invest in a term insurance plan.

Debt Protection Seekers

A loan is an essential financial companion in times of need. Be it a lifestyle elevation like buying a new car, moving into a new house, renovation or some life goal like marriage or education, a term insurance policy serves as a reliable shield against unforeseen circumstances. Buying a term plan of the loan equivalent amount ensures that the outstanding loans are settled without burdening family members.

Pre and Post Retirees

As people approach retirement, most of their liabilities are over home loans, child education, etc. In most cases, they just need to take care of the basic lifestyle and necessities for themselves and their dependents. Thus, a 50 lakh term insurance plan can provide sufficient coverage, alleviating the stress of financial commitments for dependents in the unfortunate demise of the policyholder.

Higher Education Seekers

Higher education is costly, especially for individuals with dependents. Suppose Mr. A, 35, enrolls in an executive MBA with a fee of 40 lakhs, funded by an education loan. A 50-lakh term insurance can safeguard his family from financial strain, ensuring they are not burdened by the loan in case of his untimely demise.

Those Looking for Charitable Contributions

Individuals with philanthropic inclinations can utilize a 50 lakh term insurance policy to support charitable causes. They can designate the death benefit payout to charitable organizations or causes, ensuring peace of mind that they have done their part for society and made a positive impact.

Supplementing Coverage Seekers

You might have a term plan covered by your employer or one from the younger days that now seems insufficient due to added liabilities. In such a case, you can get 50 lakh term insurance. This supplementary coverage offers extra protection for the family's long-term financial well-being. It acts as a prudent measure, addressing unforeseen circumstances that may surpass the existing policy's coverage.

Factors to Consider Before Buying a 50 Lakhs Term Insurance Plan

When considering a 50 lakhs term insurance plan, it’s crucial to examine several factors to ensure it adequately meets your needs and provides sufficient coverage for your family. Here are the primary aspects to consider:

Assess Your Coverage Needs

Calculate the coverage you need based on your financial obligations, such as outstanding loans, future expenses (like children's education), and daily living expenses. A common rule of thumb is having coverage at least 10-15 times your annual income.

Claim Settlement Ratio of the Insurer

When choosing Term Insurance, focus on the Insurer's Claim Settlement Ratio. This ratio shows how many claims are settled compared to those received. Choose an insurer with a high ratio for quick and efficient claim processing. This ensures financial security for your family. Check the total claims settled to gauge the insurer's reliability.

Review the Solvency Ratio

The Solvency Ratio gives an idea of whether your insurance provider has enough financial buffer to settle all claims in case of any extreme situation, such as natural disasters. The Insurance Regulatory and Development Authority of India (IRDAI) mandates a minimum solvency ratio of 1.5, indicating the insurer's ability to meet its long-term obligations.

Customer Satisfaction and Ratings

High customer satisfaction scores and excellent service ratings are indicators of a company’s reliability and quality of service. Research customer reviews and ratings to ensure you choose an insurer known for good customer support.

Add Riders for Extra Protection

Opt for policies with customization options to meet your needs. Add riders like critical illness cover, accidental death benefit, and waiver of premium for extra protection. These can provide additional financial security in case of unexpected events.

Premium Cost

The premium cost of a term insurance plan is significant but should not overshadow the value of the protection offered. It's essential to look for plans with favourable terms and comprehensive coverage, including crucial riders, at fair rates.

Avoid Mixing Insurance with Investments

Insurance should primarily provide financial protection. Mixing it with investment products can dilute its effectiveness. Focus on pure term insurance for adequate coverage and keep investments separate.

Consider Inflation

Choose a term insurance plan with increasing coverage. These plans raise the sum assured annually, typically by 5-10%, to keep up with rising costs. This ensures your coverage remains adequate over time, protecting your family's financial security against inflation.

How to Choose the Right Life Coverage for Yourself?

Choosing the right life insurance is essential for securing your financial future and giving you and your loved ones peace of mind. But how much coverage do you need? Let's break it down:

Assess Your Life Goals

Start by thinking about what you want to achieve in life. Are you focused on supporting your family, paying for your children's education, or leaving something behind for your loved ones? Your goals will guide you in deciding how much coverage you need.

Consider Your Financial Liabilities

List your debts, like mortgages, loans, and other financial commitments. Your life insurance should be enough to cover these, so your family won't be burdened if anything happens to you.

Evaluate Your Health and Lifestyle

Your health and habits can affect your insurance costs. For example, if you smoke or have pre-existing health conditions, your premiums might be higher. Being upfront about your health helps you find the right coverage.

Consider Your Estimated Working Years

Consider how many more years you plan to work before retirement. Your coverage should last until retirement to ensure your dependents are financially secure. Plus, you will want to choose a policy with premiums you can afford during these working years.

Use a HLV Calculator

An HLV calculator can help you determine how much coverage you need by considering your income, expenses, debts, and investments. It combines all these factors to estimate better the coverage amount that’s right for you.

How to Calculate the Premium for a ₹5 Crore Term Insurance Plan?

The premium for a ₹5 crore term insurance plan depends on key factors such as the policyholder’s age, health, lifestyle, occupation, and policy term. Additional coverage options, like critical illness riders or accidental death benefits, can also impact the premium.

Example Calculation:

Let’s assume Prakash, age 30, opts for a ₹5 crore term insurance plan:

Age: 30 years
Lifestyle: Non-smoker
Policy Term: 20 years
Sum Assured: ₹5 crore
Riders: None

Insurers determine the base premium based on age, health, and sum assured. Assuming a base rate of ₹1.5 per thousand of the sum assured, the premium is calculated as:

Base Premium = (Sum Assured / 1,000) × Base Rate Base Premium = (5,00,00,000 / 1,000) × 1.5 = ₹75,000 per year

Prakash's annual premium amounts to ₹75,000, reflecting his age and healthy lifestyle while ensuring robust financial protection.

Rider Considerations:

Although Prakash has not added riders, he can consider options like Critical Illness or Accidental Death Benefits to enhance coverage as his needs evolve.

Disclaimer: This calculation is for illustration purposes only. For an accurate premium estimate, use an online calculator provided by insurance companies or consult a financial advisor to consider specific details and current rates.

Eligibility Criteria for ₹50 Lakh Term Insurance

The exact eligibility criteria may vary slightly between different insurance providers. The following table provides a general overview.

Eligibility	Description
Age	Typically, between 18 and 65 years
Income	A minimum income to issue a term plan is above ₹5 lakhs. Your income also affects the maximum sum assured you can obtain.
Occupation	Professionals, salaried individuals, self-employed persons, and housewives. Certain high-risk occupations may be restricted.
Medical History	Insurers may require medical tests to assess health risks before issuing a policy. Your medical history can influence term insurance premiums and the maximum sum assured.
Citizenship	Indian citizen

Documents Required for ₹50 Lakh Term Insurance Plan

To purchase a 50 Lakhs term insurance plan, applicants are required to submit the documents listed below:

Identity Proof

Age Proof

Address Proof

Income Proof

Photographs

Medical Reports

Common Reasons for 50 Lakhs Term Insurance Plan Rejection

Certain factors can lead to rejecting a 50 Lakh term insurance plan. By understanding these reasons, applicants can better prepare and address potential issues in advance.

Suicide: Most insurance policies include a suicide clause, stating that if the policyholder commits suicide within the first one or two years, the claim won’t be paid. If the insurer suspects the application is an attempt to exploit this, they might reject it.

Self-Inflicted Injuries: Policies often exclude coverage for death due to self-inflicted injuries. If there's evidence that the applicant has a history of self-harm or attempted suicide, the insurer may deny coverage.

Criminal Activities: Death resulting from criminal activities is usually not covered. If you have a criminal record, insurers may reject your application to reduce their risk.

Pre-existing Medical Conditions: Severe or multiple pre-existing conditions like diabetes, heart disease, or cancer make you a higher risk for insurers. They might reject your application or offer coverage with exclusions and higher premiums.

Non-Commercial Aviation: Engaging in aviation activities, like being a pilot or frequently flying in non-commercial aircraft, increases the risk of accidents. Insurers may reject your application or raise premiums if you’re involved in such activities.

War and Terrorism: If your profession or location is at high risk for war or terrorism, the insurer may deny coverage to avoid large potential claims.

Tax Benefits for 50 Lakhs Term Insurance Policies

If you hold a term insurance policy valued at 50 lakhs in India, you can benefit from various tax advantages as outlined in the Income Tax Act of 1961. Below is a breakdown of these key benefits:

Section 80C: Premium Payments

Under Section 80C, you can claim a tax deduction on the premium paid for your term insurance policy, with a maximum limit of 1.5 lakh INR annually. This benefit applies to both individuals and Hindu Undivided Families (HUFs).

According to Section 10(10D), any amount received from your term insurance policy, including the death benefit, is exempt from tax.

Conditions to Qualify:

The premium must not exceed 10% of the sum assured for policies issued on or after April 1, 2012.
The premium must not exceed 20% of the sum assured for policies issued before April 1, 2012.
If your policy does not meet these conditions, a Tax Deducted at Source (TDS) of 5% will apply if the payout surpasses 1 lakh INR in a financial year.

Section 80D: Health Riders

Section 80D provides additional tax deductions if your term insurance policy includes health-related riders such as critical illness or accidental death coverage.

Deduction Limits:

If you are below 60, you can claim a deduction of up to 25,000 INR.
As a senior citizen, you can claim a deduction of up to 50,000 INR.

Discover Other Sum Assured Options for Term Plan As Per Your Need

Choosing the right sum assured is crucial for selecting the best term life insurance plan to protect your family’s financial future. Here are the available options for sum assured amounts that might suit your needs:

25 Lakh

Term Insurance Plan

75 Lakh

Term Insurance Plan

3 Crore

Term Insurance Plan

4 Crore

Term Insurance Plan

5 Crore

Term Insurance Plan

10 Crore

Term Insurance Plan

15 Crore

Term Insurance Plan

20 Crore

Term Insurance Plan

A ₹50 lakh term insurance plan offers an affordable and essential safety net for your family's financial security. With premiums starting as low as a daily cup of coffee, this plan protects your loved ones from life's uncertainties.

However, an average-earning individual should at least plan to buy a 1 crore term insurance policy. Whether starting a family or planning for the future, this policy provides peace of mind and a solid foundation.

FAQs about 50 Lakh Term Insurance Plan

All

Eligibility

Cost

Tax

Management

Are there any tax benefits in a 50 lakh term insurance plan?

As with other term plans, the premium paid towards 50 lakh term insurance is tax-free under section 80C, and the death benefit is tax-free under section 10(10D) as per the prevailing income tax laws.

What is the premium for a 50 lakh term insurance plan?

The premium for a term plan depends on the life insured’s lifestyle, age, health and few other factors. The younger the age, the lesser the premium.

What are the eligibility requirements for a 50 lakh term plan?

Eligibility for a 50 lac term plan typically includes age (usually between 18-65 years), income proof to justify the sum assured, and medical history. The specific criteria can vary based on the insurance provider.

Are there any tax benefits in 50 lakh term insurance plans?

Yes, premiums paid for term insurance plans, including those with a sum assured of 50 lakhs, are eligible for tax benefits under Section 80C of the Income Tax Act, 1961. The death benefit is also tax-free under Section 10(10D). However, tax benefits depend on the prevailing income tax laws.

What is 50 lakh return policy?

The 50 Lakh Return Policy refers to a term insurance plan with a return of premium feature. If the policyholder survives the policy term, they will receive back the total premiums paid, excluding GST.

Is a 50 lakh term insurance plan sufficient for my family's financial needs?

Whether a ₹50 lakh term insurance plan is sufficient depends on factors like your current lifestyle, outstanding debts, future financial goals, and inflation. It is recommended that you opt for a coverage amount that is 10 to 15 times your annual income.

What factors influence the premium of a 50 lakh term insurance plan?

The premium of a 50 lakh term insurance plan is influenced by factors such as the policyholder's age, health status, lifestyle habits (e.g., smoking), occupation, and the length of the policy term. Additionally, the sum assured, any riders or additional coverages, and the insurer's underwriting process also play a significant role in determining the premium.

How can I find the most affordable 50 lakh term insurance plan option without compromising coverage?

Considering factors like claim settlement ratio, policy features, and customer reviews. Opt for policies that offer essential benefits without unnecessary add-ons, and consider purchasing online for discounts. Regularly reviewing and adjusting the plan as needed can also help maintain affordability.

Can I increase the sum assured of my 50 lakh term insurance plan in the future, and if so, what are the associated costs and procedures?

Yes, you can increase the sum assured of your 50 lakh term insurance plan in the future. The process typically involves undergoing a medical examination and paying additional premiums based on your age, health, and the increased coverage amount. You can also opt for rider options that allow an increase in the sum assured.

How do riders like affect the premium and overall benefits of my 50 lakh term insurance plan?

Adding riders like critical illness cover, accidental death benefit, and return of premium increases your premium but enhances overall benefits by providing additional financial protection for specific events.

In the event of my untimely death, how can my family ensure a smooth claim settlement process and avoid delays or complications?

To ensure a smooth claim settlement, your family should keep your policy documents accessible, notify the insurance company promptly, and provide all necessary documentation, such as the death certificate and any claim forms. Regularly updating beneficiary details and informing them about the policy can prevent delays.

What health conditions or lifestyle factors might affect my eligibility for a 50 lakh term insurance plan?

Health conditions like diabetes, heart disease, or a history of cancer can impact eligibility for a term insurance plan. Lifestyle factors such as smoking or excessive alcohol use also matter. Address these concerns by maintaining a healthy lifestyle, getting regular check-ups, and providing accurate information during underwriting.

After the initial term, can I convert my 50 lakh term insurance plan to a whole life insurance policy?

Yes, many insurers offer conversion options. The advantages include permanent coverage and potential cash value accumulation However, this comes with increased premiums and the loss of term insurance benefits, such as its lower cost than term plans.

How often should I review my 50 lakh term insurance plan to ensure it remains aligned with my evolving financial circumstances and family needs?

Review your term insurance plan annually or after major life events like marriage, the birth of a child, or a significant change in income. Regular reviews help ensure coverage remains adequate and aligned with your current financial situation and family requirements.

Is it better to get term insurance or health insurance?

Both serve different purposes, and ideally, you should have both. Term insurance offers financial support to your family if you're no longer there, while a health insurance policy helps manage medical costs during your lifetime.

If your main concern is your family’s financial stability after your passing, term insurance is key. But if you're worried about rising healthcare costs and medical emergencies, health insurance is a must-have.