We might have come a long way in creating formulae and solving very complex calculations. However, when it comes to all the uncertainties that life can throw at us, all of these calculations fade away. One of the easiest ways to handle such instances is to take the help of a life insurance. A life insurance is a generic umbrella which covers a slew of products. The intent of all of these products is to ensure that you or your loved ones are well taken care of financially in the case of an unforeseen event.
To deem one or more companies as the best in a certain business aspect, one must compare them across uniform parameters. When it comes to life insurance in general, here are some of the parameters that one must base their comparison on.
- Solvency Ratio
This ratio primarily shows if the insurer is in good or bad financial state. What this ratio means for you is the ability of the company to settle claims. The IRDAI mandates insurers to have a solvency ratio of 150% to minimize the risk of bankruptcy. Thus, it should be one of the prime factors for comparison.
- Claims Settlement Ratio
The CSR or claims settlement ratio is another parameter which can show you a clear indication as to you should choose an insurer or not. This ratio indicates the total number of cases that an insurer has settled versus the total number of claims that it had received. A higher number is what you should be looking at. A healthy CSR will offer you peace of mind, knowing that the insurer settles most of the cases that it receives.
Keeping these two basic yet strong enough points, here are some of the best life insurance companies in the country.
Life Insurance Corporation is a brand that is synonymous with insurance. The firm is one of the largest insurers in the country when it comes to life insurance products. LIC enjoys a very healthy CSR ratio and a solvency ratio of 151%. Apart from coming strong on these two parameters, the brand has expertise in handling insurance products for a very long time. So, you cannot go wrong with any of its product offerings.
- HDFC Standard Life
HDFC’s insurance arm has been slowly yet very steadily strengthening its position in the life insurance market. The insurer has a very impressive claim settlement ratio along with one of the highest solvency ratios at 192%. If these two factors weren’t enough for you to consider them as your insurer, they also have a very user friendly customer service desk.
- Bharti AXA
Bharti AXA is another insurer that makes into the list of one of the best life insurance companies in the country. The brand scores a strong 182% as far as the solvency ratio is concerned. Bharti AXA has managed to bring some innovative products to the table and a great customer service desk as well.
Tax Saving Plans in Life Insurance
Life insurance plans have an inbuilt USP in the form of tax savings. In fact, that is one of the prime reasons why a lot of people consider life insurance plans. Irrespective of which insurer you wish to buy your policies from, you will come across tax saving plans. Here are a few examples of the most popular life insurance plans in the country.
- HDFC Life Click2Protect Plus
- LIC New Jeevan Anand
- PNB MetLife Mera Term Plan
- LIC New Jeevan Nidhi
- ICICI Prudential Wealth Builder II
You can pick up anyone from the above popular list of plans or even opt for other plans. They will all ensure that you get tax benefits in some form or the other.
How to Save Tax in Life Insurance
Depending on the category of life insurance plan, there are a couple of ways in which one can save taxes. For starters, any premium amount that you pay for your life insurance plans qualifies for tax deductions. You can claim for these deductions under Section 80C of the Income Tax Act, 1961 up to a maximum of INR 1, 50,000. You can exhaust the entire limit using your life insurance premiums.
Some of the proceeds of a life insurance policy as also exempted from taxes. This means, that if you or your family members were to receive payouts from a policy, it is exempted from taxes under Section 10 D (D) of the Income Tax Act, 1961. Though this should not be the primary motive for buying a policy, it can surely support your decision.