Bharti AXA iProtect—Online term life insurance hits a new price bottom

There is a new insurance product using the iProtect brand name in the market. ICICI Pru Life has one and now Bharti AXA Life has used the very same product name. The premium is cheapest offered so rar, which means that price war between insurers is still hot. The Bharti product is a good deal for non-smokers, but a little expensive for smokers

The Insurance Regulatory and Development Authority (IRDA) has allowed the same product name for new a term life insurance plan. iProtect is a product from ICICI Pru Life and now Bharti AXA Life has launched a product with exactly same name for its online term life insurance. IRDA has done this in the past, too, but it is rare to have the same product name from different insurers. Is it intentional copying of the product name? We don’t know.

Bharti AXA Life iProtect is now the cheapest online term life insurance plan for non-smokers. There is a wide difference in the premium between smokers and non-smokers. The premium for Rs50 lakh Sum Assured (SA) for a 27-year old non-smoker male based in Mumbai for a policy term of 25 years is Rs3,700 (excluding taxes). On the other hand, the premium for a smoker in the same case will be Rs6,150 (excluding taxes).

Recent entrants DLF Pramerica U-Protect and Edelweiss Tokio Life Protection have premiums which are the lowest in offline term plan space. Their premium are Rs5,956 and Rs5,984 respectively for similar parameters. Both the products are offline as of now.

Aviva i-Life was the cheapest term life insurance till now with the revamped Aegon Religare iTerm closing the gap. HDFC Life Click2Protect was recently launched to compete in the online term market. The much-awaited online term plan this year will be from LIC, which is is expected to hit the market soon.

Advantages of Bharti AXA iProtect

  • Cheapest term life insurance
  •  For SA above Rs50 lakh, premium discount is given
  • This policy offers reduced premium for non-smoking policyholders
  • Family care benefit: This benefit becomes applicable after premiums for two consecutive years have been paid. Under this, a part of SA equal to Rs1 lakh is provided to the nominees within 48 hours of submitting all the required claim documents. The 48-hour time limit is subject to some conditions like working day, etc
  •  The press release specifies no medical test till Rs50 lakh, however, the brochure silent on the medical test

Disadvantages of Bharti AXA iProtect

  • The maximum age at maturity is 60 years. Many other plans are available till the age of 70 to 75 years.   
  •  Policy term can be for 10, 15, 20, 25 and 30 years. E.g. A policyholder of 42 years will be offered a maximum policy term of 15 years which will end when the person is 57 years. It will not be easy to get another term plan from another insurer at that age.
  •  Minimum sum assured is Rs25 lakh
 
Online term life plan options for Rs50 lakh sum assured for 27-year old non-smoker male based in Mumbai for policy term of 25 years. Premium inclusive of taxes

ICICI Pru Life iCare has tried to address the major hiccup with the online term insurance buying process. The medical tests which online term insurance products require for all (or higher age groups) has been done away with this innovative product. There were issues like premium hike after medical tests which used to catch customers by surprise. This one-of-a-kind product will have no medical tests and no surprises of premium hike. This is an online term plan in the complete sense.

The question is whether an online sale without any agent makes up for such a gigantic difference in the premium? It cannot justify the enormous variation; even though that’s the standard answer you will read or hear from the insurance company. Is there an assumption of the online buyer living a healthy lifestyle, having access to proper healthcare and hence will live longer? Time will tell if the assumptions stand true. The mortality experience of the product will tell if the premiums collected are enough or the insurance company has a hole in its pocket.

You may also want to read:

HDFC Life Click2Protect—an online term life insurance @50% discount

Online term life insurance – Race to the bottom?

Online term plans
 

 

Comments
Dharmesh Kumar
1 decade ago
Term Plan
misrilal k
1 decade ago
it very good policy in fact iam intrested to know some more details about the policy can you send our excecutive to meet me 9948720718
Madhusudan Thakkar
1 decade ago
Raj....Looking Good....Excellent analysis ...One of the best piece of yours...Keep it up...Only ML can do such in depth analysis....Thank You
raj
Replied to Madhusudan Thakkar comment 1 decade ago
Thanks, Mr. Thakkar
Madhusudan Thakkar
Replied to raj comment 1 decade ago
Aaisa piece lik ke aap agent community ka kya chuthe kaarana chate ho...Raj Saab?.....LOL...This piece is written without FEAR or FAVOUR to any company.....Keep up the good work under guidance of Sucheta Ji & Debhashish
raj
Replied to Madhusudan Thakkar comment 1 decade ago
thank you. hope you like the Moneylife cover story has came in the market today. Read it.
RAJESHWAR REDDY
1 decade ago
The purpose of taking the term insurance is to support the family in that particular persons absence.what is the use if the companies reduce the premium and as well as reduce the claim settlement ratios? Only LIC where agent is the mediator will solve this purpose.The figures prove this as per the IRDA Report.
raj
Replied to RAJESHWAR REDDY comment 1 decade ago
LIC does have best settlement ratio. Insurance companies who are in business for short time will not have high settlement ratio as early death claims (within three years of taking policy) are scrutinized more by all insurance companies including LIC. As the insurance company grows old, these ratios are supposed to improve.

Read our cover story on term plans http://moneylife.in/article/online-term-...
RAJESHWAR REDDY
Replied to raj comment 1 decade ago
Then how come 2 companies which are started in the same year 2000 have different claim settlement ratios.Example : HDFC and Max New York which have 91.14% and 65.51%
raj
Replied to RAJESHWAR REDDY comment 1 decade ago
Read again. I have written that these ratios are SUPPOSED to improve.

Max New York...we had already written about it. Read http://foundation.moneylife.in/article/m...
B V Vijaya BE CIS
1 decade ago
You haven't mentioned the premium of LIC of India which makes your article more biased to Pvt. Insurers. LIC happens the biggest Insurer in India with Highest Claim Ratio in the World. Side by side you should have mentioned the claim ratio of all companies too which is a major parameter.
raj
Replied to B V Vijaya BE CIS comment 1 decade ago
The article is for online term life insurance. LIC does not have online plan till now.

How can you say that the article is biased to private insurers? It mentions that the low premium pricing for online term plans is based on assumptions which only future will tell if it holds true.

If you want to read about settlement ratio and many other details, please read http://moneylife.in/article/online-term-... It is a cover story which is on the home page of the Moneylife website under Moneylife Essentials. How did you miss it?

There are also many other short articles on latest settlement ratio, etc. You have to do search on Moneylife website if you want to read on different aspects of life, health and auto insurance.

Don't expect a news article to give you information on all aspects of life insurnace industry.
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