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Best Term Insurance Plans for the Sandwich Generation

Best Term Insurance Plans for the Sandwich Generation

The sandwich generation, or those in their 30s and 40s, are stuck between an upcoming generation and a generation whose glory is past. They are responsible, not only for the younger ones but also for the aging adults in their families. The best way to ensure that both these generations are financially secure even in your absence is by purchasing a life insurance policy.

India has been taking huge strides in the life insurance industry. In the year 2019, India was ranked 10th in the global life insurance industry. In fact, of the total premium garnered by the insurance sector in the year 2019, the share that is attributed to life insurance policies stood at a whopping 74.94%.

These numbers have only risen since the onset of the pandemic. The need for insurance coverage was truly understood by the consumers as the world was gripped by the fear of the novel coronavirus. This article looks into the dilemma of multiple options that the sandwich generation is faced with. And it specifically focuses on term insurance plans as they are the most commonly preferred insurance plan in India. The different aspects of term plans are discussed and the readers are given pointers to help arrive at the best term insurance plans.

Many options to choose from

The sandwich generation is caught between the past and the present and their responsibilities towards them. They have numerous options of life insurance plans to choose from. These plans may be broadly grouped into the following categories.

1. Endowment Insurance Plans

Endowment insurance plans are the earliest form of life insurance plans that we had in India. The majority of the policyholders under this category of insurance plans are salaried and receive the benefits of endowment insurance plans through their employers. Simply put, it is both an insurance plan and a long-term savings plan. A part of the premium paid is reserved as savings, whereas the other part is used to cover in the case of emergencies (insurance). If the policyholder outlives the plan, they are entitled to the savings amount (maturity benefit) that has accrued in the lifetime of the policy.

2. Unit Linked Insurance Plans (ULIPs)

Unit linked plans are another type of combination insurance plan. Here, a portion of the premium goes towards risk coverage, and the remaining is invested in funds. It is hence, a part investment part insurance plan. The money can be shifted between the investment and the risk cover according to the policy holder’s wish. This flexibility makes it a popular investment in India.

3. Term Insurance Plans

Term insurance plans are those that only cover risks. The entire premium paid is dedicated to covering expenses incurred in the case of emergencies. This makes it a very simple affair, and is perfect for the adults of this generation, who are looking to be insured. Enjoy extensive risk coverage at affordable premiums and claim tax deductions on the premium paid. This article will lay out the features of the best term insurance plans in India that the sandwich generation should watch out for.

What is a term insurance plan?

Term insurance plans are simply insurance plans that cover the insured for a fixed period (term). The entirety of the premiums paid during the subsistence of the policy goes towards coverage of the insured for risks in life. This is one of the most commonly availed life insurance plans in India because it affords greater protection at affordable rates. For someone who is responsible for both the younger and the older generation in the family, term insurance plans are the best way to secure the future.

Term plans cover the 3D

Term insurance plans cover the three major risks that life throws at one – death, disease, and disability. In addition to death benefits, term insurance plans cover expenses incurred in the treatment of disabilities and critical or terminal illnesses.

How is the premium calculated?

The premium is the amount that is periodically paid to the insurance service provider so that the policyholder is adequately covered. As mentioned above, the premiums in term insurance plans go completely towards risk coverage and are therefore more affordable than that of the other types of insurance plans. The premium is calculated on the basis of several factors. These factors include the age of the insured, the gender of the insured, the policy terms and the insurance coverage being availed, the medical history of the insured, the lifestyle led by the insured, and the occupation of the insured.

The advantages of term plans

There are numerous benefits to purchasing a term insurance plan. Some of the major advantages of term plans are listed below.

  • Receive extensive risk coverage for affordable premiums
  • Receive coverage for illnesses – both critical and terminal
  • The insurance cover can be adjusted according to changing circumstances
  • Receive additional security through riders
  • Enjoy the benefits of multiple options for payout
  • Enjoy tax deductions

Choose the best term insurance plan

Now that you know what a term insurance plan is and what its advantages are, here are a few steps that will help you choose the best term insurance plan for you.

1. Determine cover amount

The first step to cross in the quest to arrive at the best term insurance plans is to determine what the cover amount of the policy should be. While determining this amount, consider factors like age of the insured, the medical history of the insured, potential inflation, existing liabilities or debts, etc.

A simple way to arrive at this amount is to keep this general formula in mind – the ideal term insurance cover for a policyholder between 20 to 30 years of age should be about twenty times their annual income. Remember, the younger the insured, the greater the policy coverage.

2. The insurance provider should be reliable

The quest to arrive at the best term insurance plans is to ensure that the future is secure for your loved ones. This security can be truly enjoyed only if the insurance service provider you opt for is reliable.

Claim Settlement Ratio(CSR) is a factor that will help determine reliability. It is a metric that represents the ratio of the total claims raised in a year to that settled in the same year by the insurance provider. Similarly, the solvency ratio of the insurance provider should have been constantly over the minimum mandate. And lastly, the market reputation and financial background of the insurance provider can serve as important factors to determine reliability.

3. Choose the policy duration

The next step in choosing the best term insurance plan is to choose a policy duration that is right for you. The term of the policy determines the benefits received from it, premium amount, etc. It should be chosen to keep in mind the age of the policyholder. Experts in the insurance industry advise that if the insured is in their 20s, one should go for term insurance policies that last for a term of at least 40 years.

4. Make sure payments are feasible

The final step in arriving at and purchasing the best term insurance plans is to make sure that the terms of payment and the options related to it are feasible. This includes not only the premium amount but also the mode of payment of premiums and the frequency with which premiums may be paid. Look into your bank statements and choose the payment option that is most feasible for you.

Buy a term plan easily

People of the sandwich generation can often feel left out in this fast-paced world. From growing up in a world where paper and books were a luxury to living in a soon-to-be paperless world, the shifts and changes have been revolutionary, to say the least. But there is no need to be worried. The process of purchasing the best term insurance plans is simple and quick and can be done in the comfort of one’s own home. The steps to be carried out are given below :

  • Visit the insurance service provider’s website.
  • Choose the desired term insurance plan.
  • Fill out the details required by the insurance provider
  • Check the premium amount, mode, and frequency of payment
  • Make the payment online

Once you follow these simple steps, you will receive the policy details in the email address you have registered with the insurance provider.

A checklist to choose term plans

In summation, here is a checklist of the factors that are characteristic of the best term insurance plan.

  • Reliable insurance provider (high CSR)
  • Extensive coverage options
  • Provides a wide variety of riders
  • Premiums are affordable
  • Numerous payment options that are flexible
  • Positive feedback on the plan from customers

This checklist will help you weed out the sub-par and choose only the best term insurance plan so you can bite into that scrumptious sandwich knowing fully well that your future and the future of the younger and older generations in your family is also secured.


*Tax benefits are as per the Income Tax Act, 1961, and are subject to any amendments made thereto from time to time
The article is meant to be general and informative in nature and should not be construed as solicitation material. Please read the related product brochures for exclusions, terms and conditions, warranties, etc. carefully before concluding a sale.
Make responsible financial decisions. Consult with your financial advisor before making any decisions on insurance purchase.

Suggested Plans

Bharti AXA Life Guaranteed Wealth Pro

  • A non-linked, non-participating individual savings life insurance plan
  • Flexibility to choose the payout structure
  • Multiple income options
  • Option to receive tax free income beginning from the second policy year itself
  • Option to get lifelong income along with life cover till 100 years of age

Bharti AXA Life Shining Stars

  • Non-linked, non-participating limited pay endowment Life Insurance plan
  • Designed to take care of the financial needs of your child.
  • Flexibility to opt between 2 Maturity Payout Options
  • Flexibility in Policy Term/Premium Payment Terms
  • A great short-term investment option for a child insurance policy.

Bharti AXA Life Super Series

  • A non-linked non-participating individual life insurance savings plan
  • Range of investment duration and returns
  • Guaranteed money back benefits (provided policy is in force and all due premiums have been paid)
  • Income tax benefits (as prevailing tax laws in India that are subject to changes)