Pluto

₹2 Crore Term Insurance Plan

Buy 2 Cr Term Insurance Plan Starting @ ₹1400/m

A ₹2 crore term insurance policy is a form of pure life insurance cover that provides a lump-sum payout to the policyholder's nominees if something unfortunate happens to them during the term. If you purchase a ₹2 crore term life insurance policy, your insurer ensures a financial safety net for your family or nominees as long as you keep it active with timely premium payments. Whether you are the sole earner of your family or simply want to keep your family secured against uncertainties of life, such a payout helps your loved ones to keep up with daily expenses, financial liabilities and achieve their future goals.
100% freeexpert guidance

30 min with an
IRDAI-certified advisor

Pluto insurance advisor

Available Slots on Friday, 6 November

Harsh Saini

Written by Harsh Saini

Content Expert

Ayush

Written by Ayush

IRDAI-Certified Expert at Pluto

Jump to a section

What is a ₹2 Crore Term Insurance Plan?

A ₹2 cr term insurance plan provides a pure life cover of ₹2 crore to the family members of a policyholder chosen as a nominee if something happens to them due to an unfortunate incident. Insurers offer such plans with flexible durations, such as 10, 20, 30 years or more, for which the term policy remains active. This type of plan only focuses on covering risk and does not have a savings component. It generally comes at a relatively reasonable price compared to other life insurance plans. This also means that if you survive your chosen policy term (say, 30 years), your policy expires. However, insurers provide options such as 'Return of Premium' that pays your premiums back on maturity.

Features of a ₹2 Crore Term Insurance Plan

One of the notable features of a ₹2 crore term insurance is that you can ensure a financial safety net for your loved ones. It combines a significant sum assured with options that allow you to tailor the policy to your financial goals and responsibilities. These features make it easier to choose coverage that suits your needs. Let us discuss these features in detail:
01

Efficient Coverage at an Affordable Price

A term life insurance of ₹2 crore offers extensive coverage of such a high amount at lower costs than other plans. This feature makes it a suitable choice to ensure financial security without straining your budget.
02

Flexibility to Choose Your Term

Insurers generally allow you to choose the term of a ₹2 crore insurance policy as per your requirement. For example, in your 20s or 30s, you may opt for a 30-year plan as your working years are more.
03

Flexibility in Premium Payments

Providers of term insurance allow flexibility in premium payments, suiting the needs of policy buyers. Insurers generally offer annual, semi-annual, quarterly, and monthly premium payment options. You may choose the premium frequency with which you are comfortable.
04

Customisation of Policy

While purchasing a ₹2 crore term insurance plan, you can enhance its coverage scope. You can do it with riders such as an accidental death rider, waiver of premiums, critical illness and others and ensure additional coverage.

Key Benefits of a ₹2 Crore Term Insurance Plan

The benefits of a ₹2 crore term plan extend beyond the cover amount, offering flexibility in entry age, payout and tax savings. Let us find out how:

  • Low Premium at Young age

    Most providers set the age of 18 years as an entry age for a term plan. The maximum age is also higher, i.e. around 80 years, allowing coverage for aged individuals. This flexibility of age range allows individuals to enter into a term plan at their preferred life stage.

  • Death Benefit as Regular Income

    You can choose to have the death benefit paid as a lump sum, regular monthly income or a combination of both. This gives your family greater flexibility to manage immediate and ongoing expenses in your absence.

  • Tax Saving Benefits

    As you pay premiums for a term plan, you may claim a tax deduction of up to ₹1.5 lakh in a financial year. However, you must choose the right tax regime for this benefit when you file your income tax returns.

Who Should Buy a ₹2 Crore Term Insurance Policy?

A ₹2 crore term insurance policy may be suitable for individuals whose families depend on their income or who have significant financial responsibilities to fulfil. Let us find out who else should opt for this term plan:
Buying a term plan at a young age can help you secure your family’s financial future early. Even if you have fewer financial responsibilities today, the coverage can help protect dependents, such as your parents, in your absence. Moreover, purchasing a policy when you are younger may help you secure a lower premium.

Benefits of Buying a 2 Crore Term Insurance - Based on Age

Here is a detailed breakdown of buying a term insurance of ₹2 crore at different life stages and according to needs:

In Your 20s

In your 20s, when people generally begin their careers, opting for a ₹2 crore term plan allows you to get this high coverage at a comparatively lower cost. Thus, from an early age, you can secure your loved ones and ensure peace of mind.

How to Choose the Right Coverage Amount for Term Insurance?

Before purchasing a term plan, you may wonder whether a ₹2 crore coverage is right for you in order to secure the long-term future of your family. For this, you must factor in the following aspects:

Calculate Your Earnings

Your annual income is one of the fundamental yet key factors to consider when finalising a coverage amount. Multiply your annual income by 10 or 12. For instance, if the outcome is equal to or approximately equal to a ₹2 crore sum assured, then it is right for you.

Replace Your Lost Income

Calculate the income your family would lose if you pass away before retirement and determine the amount required to cover everyday expenses, meet ongoing financial obligations and maintain their existing lifestyle without your earnings.

Factor in Your Earning Years

Calculate how many years are left until your retirement before finalising a coverage. For example, if you are 30 years old and plan to retire at 58, you have 28 working years remaining. Considering the income stability, you can understand whether you can continue the plan for your remaining working years.

Consider Major Milestones of Life

Expenses for major milestones of life are not recurring but require a higher fund available at disposal. Assess the expenses for education fees of your children or expenses for their marriage or other milestones and align them with the coverage amount of the term plan.

Factor in Liabilities and Remove Assets

To know whether a coverage is right for you, subtract your total asset value from liabilities. For instance, you may have financial assets like money invested in stocks, mutual funds, FDs, real estate, gold, etc., totalling ₹3 crore. On the other hand, your liabilities like a home, car or an education loan and others total ₹5 crore. In this case, you may opt for a ₹2 crore term plan.

Things to Consider While Buying a ₹2 Crore Term Insurance

Factors like your income level, your existing financial responsibilities, number of dependants and others are some crucial ones to look out for while buying a ₹2 crore term plan:
Your annual income is an important factor in determining a suitable term life cover, as it reflects your financial standing, lifestyle and premium-paying capacity. Consider whether a ₹2 crore cover is sufficient to replace your income.

Factors Affecting ₹2 Crore Term Insurance Premium

The premium for a ₹2 crore term insurance plan depends on your personal profile, the coverage duration and the level of risk you present to the insurer. These factors help insurers estimate the likelihood of a claim and the cost you need to pay for such cover. Let us discuss these factors in detail:

Age and Gender

As health risks and financial liabilities are generally lower at a younger age, insurers may offer lower premiums for the same coverage compared with buying a policy later in life. From a mortality perspective, women generally have longer life expectancies than men and thus are offered slightly lower premiums.

Medical History in the Family

Family medical history of an individual may also act as a premium-influencing factor. For example, suppose the parents of an individual have a record of high blood pressure or high blood sugar levels. In the eyes of an insurer, that individual may be at high risk, as they can also develop the same health condition in the future and thus incur a higher premium.

Total Annual Expenses

Family medical history of an individual may also act as a premium-influencing factor. For example, suppose the parents of an individual have a record of high blood pressure or high blood sugar levels. In the eyes of an insurer, that individual may be at high risk, as they can also develop the same health condition in the future and thus incur a higher premium.

Occupation

If your job involves physical hazards (e.g., working at a chemical plant), working at heights, or operating heavy equipment, insurers may consider you a higher risk. Aside from physical risks, if your job requires longer travel, work hours or involves high stress due to your job description, you may face a higher premium.

Lifestyle

Due to lifestyle, unhealthy diet, workplace stress and other reasons, diseases like obesity, hypertension, cardiovascular concerns, etc., are on the rise in India. An individual with such existing health concerns may face a higher premium as insurers take higher risks.

Smoking or Drinking Habits

Excessive smoking or drinking habits may lead to serious health concerns, even leading to terminal ailments. Policy buyers with such habits may find premiums to be higher compared to non-smokers or non-drinkers.

Policy Term

While a higher term is generally better for efficient coverage, as you pay a premium for a longer period, the expenses accumulate. Therefore, assess your income stability, budget and other factors and determine a tenure that you can afford.

How to Calculate ₹2 Crore Term Insurance Premium?

With Pluto, get an instant estimate for the premium of a ₹2 crore term life policy based on your age, lifestyle habits and other factors. Provide the information below and understand how much to pay for this coverage amount:

1

Basic Details

Provide your basic details like your name and gender in the specified fields of the calculator

2

Date Of Birth

Enter your accurate date of birth in DD/ MM/ YYYY format in the designated field. This helps to determine your current age.

3

Sum Assured

Provide the amount of coverage for your term insurance plan. In this case, select ₹2 crore as your sum assured amount. Also choose the term or tenure for which you want to get life cover.

4

Lifestyle Habits

You may be asked about lifestyle habits such as tobacco consumption to assess health risks. Choose ‘Yes’ or ‘No’ depending on whether you consume tobacco by any means.

5

Income and Location

The calculator may ask you for your annual income. Calculate your annual income accurately and place it in the designated field.

6

Premium Amount Calculation

Press the ‘Calculate’ button and the calculator instantly provides you with the estimated premium amount that you may need to pay for a ₹2 crore term plan.

Things to Consider While Buying a ₹2 Crore Term Insurance

When buying a ₹2 crore term insurance plan, assess whether the coverage aligns with your financial responsibilities and your family’s future needs. The right cover should offer adequate protection without making premium payments difficult to manage.

Here are some key pointers to consider while buying a ₹2 crore term plan:

  • Your Income

    Your annual income is an important factor in determining a suitable term life cover, as it reflects your financial standing, lifestyle and premium-paying capacity. Consider whether a ₹2 crore cover is sufficient to replace your income.

  • Your Remaining Earning Years

    Consider the number of working years you have remaining before retirement. Since term life insurance acts as an income replacement tool, your expected earning period helps determine how long your family may need financial support.

  • Total Annual Expenses

    You must factor in all current expenditures you incur annually. For example, consider school fees (if applicable), groceries, healthcare expenses, utility bills, fuel expenses, etc. Aside from these, consider periodic expenditures as well. Ensure that the ₹2 crore payout from the term will be enough to cover such annual expenses for your dependants.

  • Financial Liabilities

    While buying a ₹2 crore term insurance, assess your liabilities, such as an existing home, car or education loan that you have taken. Ensure that this payout is enough to pay back these loan amounts in your absence.

  • Financial Dependants

    People with dependants like ageing parents, spouse, and children may find a term plan with a high cover of ₹2 crore suitable. Such a policy can help to deal with daily expenses when the policyholder is not around.

  • Account for Inflation

    Inflation is one of the crucial aspects to factor in when finalising a term plan with a certain sum assured. This is because, with inflation, living costs increase and thus accomplishing financial goals also gets costlier. Therefore, factoring in prevailing inflation helps you understand whether the ₹2 crore coverage is enough.

Documents Required to Buy Term Insurance

For a seamless purchase of term insurance with a coverage of ₹2 crore, keep the following documents handy and submit them when requested by your chosen insurer:
Aadhaar card, voter ID or driving license as identity proof.
Copy of original birth certificate for your age proof.
Copy of your updated PAN card
Copy of your utility bills, passport or any other documents as per the insurer’s request.
Latest salary slip, ITR copy or bank statement as your income proof.

Top Riders to Add to Your ₹2 Crore Term Plan

Here are some popular riders that policy buyers can opt for, along with a ₹2 crore term plan:

Accidental Death Benefit

This rider provides an additional payout up to a limit over and above the base sum assured if the policyholder passes away due to an accident. It can be particularly useful for individuals whose families depend on their income to repay home loans or meet household expenses.

Critical Illness

Such a rider provides a lump sum payout if the policyholder is diagnosed with a critical illness, such as stroke, kidney failure, etc. This payout can be helpful since, due to such serious health issues, an insured may become unable to earn.

Waiver of Premium

Insurers waive future premium payments yet keep the policy active if the policyholder gets this rider and is disabled due to an accident or illness during the tenure. Thus, the rider helps to reduce a financial burden, as a policyholder cannot earn anymore yet maintain their life cover.

Accidental Total and Permanent Disability

This rider provides a regular or lump sum payout if the policyholder becomes permanently disabled due to an accident. To prevent financial hassle due to a disability, you opt for this rider.

How to Save on Taxes with a ₹2 Crore Term Insurance Plan?

Tax Provision

Applicable Benefit

Section 123 

Deductions of up to ₹1.5 lakh 

Section 126 

Deductions of up to ₹25,000 (₹50,000 for senior citizens)

Schedule II(2) 

Fully tax-exempt death benefits

Fully tax-exempt maturity benefits if the annual premium does not exceed 10% of the sum assured 

Here's how you can potentially save on taxes through your ₹2 crore term insurance policy:

  • Under Section 123 of the Income Tax Act 2025 (previously known as Section 80C of the 1961 Act), you can save up to ₹1.5 lakh in a financial year while filing your ITR.
  • With health riders (e.g. critical illness), you can also save on taxes under Section 126 (Section 80D of the 1961 Act) up to a specified amount (₹25,000 or ₹50,000 for senior citizens).
  • Under Schedule II(2) of the Income Tax Act, 2025 (formerly Section 10(10D)), death benefits received by the nominee are fully exempt from tax. Maturity proceeds may also be exempt if the annual premium does not exceed 10% of the sum assured for policies issued on or after April 1, 2012 and 20% for older policies.

Frequently Asked Questions (FAQs)

How do nominees claim a ₹2 crore term insurance?
If something happens to a policyholder, their nominees must inform their insurer about the incident immediately. Upon submitting the claim form, policy details and other important documents, they become eligible to receive the payout.
What is the free look-back period in a ₹2 crore term plan?
Insurers generally allow for a 15 to 30-day look-back period, where you can opt out of a policy if you are not satisfied with its features and benefits.
Are the tax benefits available in the new tax regime?
No, the tax benefits on premiums for term plans are available only if you opt for the old tax regime. However, the death benefit received by your nominee is completely tax-free under both the old and new tax regimes.
Beta