3 reasons why Term Insurance Plans are affordable in 2026

In 2026, Term Insurance continues to be one of the simpler ways to create a substantial financial safety net for your family. Aditya Birla Sun Life Insurance (ABSLI) offers protection-oriented solutions such as the ABSLI DigiShield Plan, while the sector operates under the regulatory oversight of the Insurance Regulatory and Development Authority of India (IRDAI).

The post-budget tax environment is also changing how consumers evaluate financial products. However, the primary purpose of a Term Insurance Policy remains protection rather than investment. Premium affordability should therefore be assessed alongside the amount and duration of cover required, policy features and your family's financial responsibilities.

ABSLI's latest FYm2025-26 claims data states that, based on annual audited figures submitted to IRDAI, 98.86% of individual claims were settled, with ₹630+ crore in total claims settled.

What makes a Term Insurance Policy more affordable than many other Life Insurance products?

Term Insurance primarily provides life protection for a defined period. Unlike savings or investment-linked products, a basic Term Plan generally does not combine the cost of protection with a savings or investment component. This allows the premium to be focused on providing the selected life cover. The actual premium depends on factors such as age, health, lifestyle, sum assured, policy term, and premium-payment structure.

The affordability of Term Insurance should therefore be considered in relation to the amount of protection it provides, rather than by looking at the premium alone.

How does buying Term Insurance at a younger age affect affordability?

Age is one of the factors insurers consider when calculating Life Insurance premiums. Generally, buying cover when you are younger and healthier can result in a lower premium than waiting until later in life, although the exact premium depends on underwriting and other factors. Starting early can also help you secure protection before your income and financial responsibilities increase.

The important point is not simply to buy a policy as early as possible, but to select a suitable cover amount and policy term based on your financial needs.

How does being a non-smoker affect Term Insurance premiums?

Lifestyle and health information can influence underwriting and premium pricing. A non-smoker may generally receive a lower premium than a smoker for comparable coverage because smoking is associated with higher mortality risk.

Always disclose your smoking and tobacco-use status accurately when applying for Insurance.

What is the June 2026 premium benchmark for a 30-year-old non-smoker seeking Rs. 1 crore cover for 30 years?

For a current 2026 benchmark, the ABSLI DigiShield Plan page displays a starting illustration of Rs. 575 per month for Rs. 1 crore of life cover. However, this displayed figure is for a specific scenario: a 21-year-old female non-smoker, regular pay, 25-year policy term and level cover, with the premium stated before GST.

It should therefore not be presented as the exact June 2026 premium for every 30-year-old non-smoker seeking Rs. 1 crore for 30 years.

For a personalised 30-year-old/ Rs. 1 crore/ 30-year quote, use the ABSLI Term Insurance calculator and enter the applicant's actual details. Premiums are subject to underwriting, product options, payment mode and applicable taxes.

What are the 3 main reasons Term Insurance can be affordable?

Three factors commonly explain the affordability of Term Insurance:
1. Protection-focused design: A basic Term Plan is primarily designed to provide a death benefit during the policy term.
2. Starting early: Younger applicants may generally receive more favourable premiums, subject to underwriting.
3. Choosing appropriate cover: Selecting a sum assured and policy term that matches your actual protection needs can help avoid paying for unnecessary coverage.

Affordability should always be considered alongside adequacy. A very low premium is not useful if the cover is insufficient for your family's needs.

How does the premium payment structure affect the cost of Term Insurance?

Premium payment can be structured in different ways depending on the product, including regular-pay, limited-pay or single premium arrangements. A single premium policy involves paying the premium upfront rather than making recurring payments over the policy term. This may suit someone who prefers to make one large payment, but it requires substantial liquidity at the outset.

Regular or limited payment options can spread the financial commitment differently. The most suitable structure depends on your cash flow, financial goals and the specific policy terms.

What does Life Insurance have to do with Term Insurance affordability?

The Life Insurance means financial protection against the risk of the policyholder's death, subject to the terms of the policy. Term Insurance is one of the most protection-focused forms of Life Insurance.

Understanding this distinction helps explain why Term Plans can be relatively affordable compared with products that combine life with savings or investment features. If your primary goal is to financially protect your dependants, a term plan may be a relevant option to evaluate.

How does ABSLI's claim settlement ratio help when evaluating an affordable Term Plan?

Price is only one part of evaluating a Life Insurance Policy. Customers should also consider the insurer's claims track record, product terms, exclusions, service, and suitability.

For FY 2025-26, ABSLI's claims support 98.86% of individual claims were settled, with ₹630+ crore in total claims settled.

How can you compare affordable Term Insurance options in 2026?

Start with the protection you actually need rather than choosing a policy solely because it has the lowest advertised premium. Compare the sum assured, policy term, premium-payment term, death-benefit payout options, exclusions, riders, underwriting requirements and insurer service. You can compare ABSLI Term Insurance Plans and use the ABSLI Term Insurance Calculator for an indicative estimate.

If the ABSLI DigiShield Plan suits your requirements, you can explore the product, subject to eligibility, underwriting, and applicable policy terms.