📅 Published on: June 22, 2025
⏱️ Estimated Read Time: 5–6 minutes
Most Indian middle-class families ignore term and health insurance thinking it's a waste. But one emergency can wipe out savings. With just ₹2,000/month, you can protect your family through smart EMI-based insurance. Real-life case (Shyam vs Ram) proves why starting early matters. Don’t wait for a crisis — secure your future now.
- 📌 Introduction: Why Term and Health Insurance Are Critical in India
- 💔 Shyam vs Ram – With vs Without Insurance
- 📊 Top 5 Term Insurance Plans – India 2025
- 💡 How to Afford Insurance in ₹25K–₹40K Salary
- 💡 5 Reasons to Take Term & Health Insurance
- ⚠️ Mistakes to Avoid While Buying Insurance
- ❓ Term & Health Insurance FAQs
- 🧠 Final Advice for Indian Families
Hi, I’m Amrut Chitragar — I write simple and practical finance articles for India’s growing middle class. My goal is to help you make informed money decisions without confusion. 🙏
📌 Introduction: Why Term and Health Insurance Are Critical in India
The biggest financial mistake most Indian middle class families make is skipping insurance – both term and health. Many believe it's a waste of money because there's “no return.” But this mindset can destroy years of savings in one emergency.
❌ Common Myths People Believe
- “Why pay for something that gives nothing back?”
- “We’re healthy, nothing will happen.”
- “Office insurance is enough.”
💔 Real-Life Example: Shyam vs Ram – With vs Without Insurance
Ram: Same job, same salary. Took term & health insurance early. Got ₹15 lakh health claim when needed. Family protected. After his sudden death, ₹1 crore term plan supported children's education and household.
📊 Top 5 Term Insurance Plans in India – 2025 Comparison
| Company | Plan Name | Sum Assured | Annual Premium (Age 30) | Claim Settlement Ratio |
|---|---|---|---|---|
| LIC | Tech Term | ₹1 Cr | ₹12,000 | 98.5% |
| HDFC Life | Click 2 Protect Life | ₹1 Cr | ₹11,800 | 99.4% |
| ICICI Prudential | iProtect Smart | ₹1 Cr | ₹11,500 | 97.9% |
| Max Life | Smart Secure Plus | ₹1 Cr | ₹11,000 | 99.5% |
| Tata AIA | Sampoorna Raksha Supreme | ₹1 Cr | ₹10,900 | 99.0% |
💡 How to Afford Term and Health Insurance in ₹25,000–₹40,000 Salary
Most middle class families skip insurance not because they don’t believe in it — but because they think it doesn’t fit their budget. However, smart payment options can make it affordable without burdening monthly expenses.
✅ Smart Payment Options
- Term Insurance: Most companies allow monthly payments. For example, instead of paying ₹12,000 once a year, you can pay ₹1,000/month for ₹1 crore cover.
- Health Insurance: Now companies offer quarterly or monthly EMI options. Instead of ₹9,000/year, you can choose to pay ₹750/month.
📊 Sample Cost Estimation (Age 30)
| Insurance Type | Coverage | Monthly EMI |
|---|---|---|
| Term Plan | ₹1 Crore | ₹1,000 |
| Health Plan | ₹10 Lakh | ₹1000 |
| Total | ₹2,000/month |
📌 Conclusion
Even with a ₹25,000–₹40,000 salary, both term and health insurance can be taken smartly by opting EMI/monthly payment modes. Start with minimum, upgrade later. What matters is that you begin now.
💡 5 Reasons to Take Term & Health Insurance
- Full Protection: Term insurance protects your family’s future, health insurance protects your savings.
- Affordable When Young: ₹1,000/month (term) + ₹1000/month (health) = full coverage under ₹2,000/month.
- Tax Benefits: You save under 80C (term) and 80D (health), reducing your taxable income.
- No Worry Investing: With protection in place, you can invest in SIPs or mutual funds fear-free.
- Emergency Ready: You’ll never need to borrow or sell assets if something goes wrong unexpectedly.
⚠️ Common Mistakes to Avoid While Buying Insurance in India
- Avoid agent traps: Many agents sell high-commission products (ULIPs, endowment). Stick to term + pure health plans.
- Never mix insurance + investment: Focus on pure protection. Use separate SIP for investment.
- Read exclusions carefully: Check what’s covered and not — room rent limit, waiting period, etc.
- Check IRDAI status: Buy only from approved insurers. Visit irdai.gov.in
- Use online comparison tools: Like Policybazaar, Coverfox or official company sites to get best plan and rate.
✅ Summary
Don’t delay insurance. Even with ₹25,000 salary, you can get started with both covers. It’s better to be safe than sorry — your family deserves this security.
❓ Frequently Asked Questions (FAQs) on Term & Health Insurance
1. What is the best age to buy term insurance in India?
As early as possible — ideally in your 20s or early 30s. Term insurance premiums are lowest when you're young and stay fixed for the entire policy term.
2. Is employer-provided health insurance sufficient for Indian families?
No. Group health insurance ends when you leave the job or retire. Always have a personal or family health insurance plan for full protection and long-term security.
3. Will I get money back if I survive my term insurance period?
No. Pure term insurance does not provide maturity benefits. It is meant for life coverage only. If you're alive at the end of the policy, there's no payout — just like a helmet protects but gives no return.
4. How much term insurance coverage should I take in India?
Ideally, at least 10 to 15 times your annual income. For example, if you earn ₹5 lakh/year, take ₹50–75 lakh coverage. For metro cities, ₹1 crore is the new minimum standard.
5. Can I afford both term and health insurance with a ₹25,000 salary?
Yes. With smart monthly payment options, you can take ₹1 crore term insurance for ₹1,000/month and a ₹10 lakh health plan for ₹800/month — total ₹1,800/month fits most middle-class budgets.
🧠 Final Advice for Indian Middle-Class Families
📝 Disclaimer
This blog is for awareness purposes only. Insurance plans and prices may vary by insurer and age. Please consult with an IRDAI-registered advisor or visit official company websites before buying any plan.
🔗 More Insurance Posts: Click here
🔗 Trusted Resources to Explore More
- IRDAI – Official Insurance Regulator
- Policybazaar – Compare Term Insurance
- Coverfox – Health Plan Comparisons
- Max Life Insurance – Official Website
- Star Health – Health Insurance Plans
📣 Share This Post to Help Others
Someone you know might still be avoiding insurance. Share this guide with them. It could save their family’s future.
👉 Share Link: learnwithamrut.com – Insurance Guide 2025
Post a Comment