Term Insurance

Term insurance is the most basic form of life insurance, which comes at an affordable rate of premium.  This low-cost policy offers life coverage to the insured, where the family gets a financial shield in case of the untimely death of the insured. The benefits offered by term insurance plans can be availed for specific years in exchange for a regular premium.
Apart from the death benefit, the policy also comes in handy in covering those unavoidable financial burdens on the family, in case of accidental disability of sole earner of the family leading to loss of income.

Best Term Insurance Plans in the UAE

Here’s a quick rundown on some of the best term insurance plans in the UAE based on customer reviews, features, and services. 

Smart Term Plan from Union Insurance

Union insurance is one of the most reliable and popular insurance in the UAE. The company was established in the year 1998 with a paid-up capital of approximately AED 330 million. The company is known for its budget-friendly and innovative lineup of insurance solutions for people from all classes of society. One of such popular yet affordable insurance plans from Union insurance is the smart term plan. 

This plan is a simple, straightforward, and user-friendly term insurance that is designed and developed to mitigate the degree of risk associated with one’s life. The smart term plan offers worldwide coverage considering the number of migrants residing in the UAE. The term plan can be chosen by the policyholder based on their needs and budget. One of the major factors that make smart term popular amongst buyers in the UAE is the choice of making payments at variable intervals such as monthly, quarterly, half-yearly, annually. 

Furthermore, unlike various other term plans the enrollment process for the smart term plan is quite simple. One does not need to undergo a medical examination to purchase the policy. The eligibility criteria for this plan requires the applicants to fall in the age group of 18 to 55 with a valid Emirati visa. The provider offers a free lookup period of 30 days from the day of enrollment under which the buyer can simply cancel the policy without paying anything. 

Level Term Insurance from Alliance Insurance

Alliance Insurance is a leading insurance provider that operates in the UAE. The company offers comprehensive insurance solutions to wide a range of customers right from corporations to individuals to government bodies and undertakings. Alliance insurance various term insurance plans from basic and inexpensive to complex and expensive plans. 

One of the most selling plans of all time is the level term plan by alliance insurance. The plan offers coverage of AED 1 million with the premium based on numerous factors such as age, health condition, medical history, and the term of the plan. In the case of the level term plan, the premium is constant and remains the same during the course of the validity of the plan. In case the policyholder passes away within the policy period then the nominee of the plan receives the sum assured as the death benefit of the policy. The premium of the level term plan is quite low in comparison to other plans available. The minimum term of the plan is 5 years and the maximum term is 30 years. 

Hemaya and Hemayati Plus from Salama 

Salama is one of the most well-known names when it comes to shariah-compliant takaful providers in the UAE. The company was incorporated in the year 1979 with a paid-up capital of AED 1.2 billion. The company offers different types of financial tools and insurance products that are designed and developed to provide solutions to its customers. 

Under the category of term insurance Salama offers two types of products i.e., Hemaya and Hemayati Plus. Both the plans are term plans from the same company but offer different services and benefits. Hemaya is the basic version of a term plan from Salama and comes with options where the buyer can choose the term and cover offered by the plan. 

On the other Hemayati plus is the advanced version of term insurance from Salama. It offers high levels of financial protection to you and your loved ones in case of any event that leads to the demise or disability of the policyholder. One of the best features of this plan is that it does not require the buyer to undergo any sort of medical examination. Secondly, the plan requires minimal paperwork and comes with a guaranteed maturity benefit that makes it the right choice if one is looking for optimum returns at maturity. The minimum term of the plan is 5 years and the maximum term is 15 years. 

Pure Protection from Noor Takaful

Under the category of Shariah-compliant Takaful services, the first name that strikes one’s mind especially in the case of the UAE is Noor Takaful. The company was established in the year 2009 to provide a broad range of Islamic insurance products also known as takaful. Within the entire middle east Noor takaful has built a massive market share making it one of the largest service providers in the region. 

Under the category of term insurance or takaful, the company has an innovative product known as pure protection. The plan is term insurance that is developed in a way that it takes care of the financial needs of the policyholder’s family in case of any unfortunate event that leads to the demise or disability of the policyholder. The plan is available in variable choices of terms starting from a minimum of five years to a maximum of fifteen years. 

One of the features of a pure protection plan that makes it distinct from other plans within the same category is the provision of maturity benefit. Policyholders are entitled to receive guaranteed cashback at the maturity of the plan depending upon the term and premium of the policy. The minimum and maximum eligibility age of the plan is 18 and 60 years respectively. 

International Term Assurance from Zurich

Zurich Insurance group also is known as Zurich is a Swiss company located in Zurich, Switzerland that renders insurance services all across the globe. The company deals in different kinds of insurance services and products such as general insurance, farming insurance, and global life. 

The company offers a term insurance plan known as international term insurance that is available in the UAE as well. The plan is designed and developed considering both the needs of expatriates as well as Emiratis. The ITA comes with critical illness coverage at extremely low premiums making it the right choice for applicants searching for plans with low premiums. The plan tenure and coverage are free to be chosen by the applicant based on their needs and requirements. If one is looking forward to enhancing the coverage of the basic plan, they can go for purchasing add-on riders such as accidental cover, waiver of premium, etc. 

Healthee Plan from LIC International

Life insurance corporation commonly known as LIC is one of the largest insurance providers that operates in India, Sri Lanka, Nepal, and the UAE. The Healthee plan provides coverage against 37 life-threatening ailments and covers the disability and demise of the policyholder due to any unforeseen event. 

The premium of this plan is variable and depends on a plethora of factors such as age, health, occupation, term, coverage, etc. A major factor that influences the prices of the premium is smoking habits. People who tend to smoke end up paying more premium in comparison to non-smokers as the chances of claim submission are reduced substantially. The minimum and maximum eligibility age for the plan is 18 and 65 years respectively. The policyholder can enhance the protection quotient of the basic plan by simply opting for add-on riders. The plan offers numerous riders and the policyholder can choose the ones based on their needs and budget. The minimum and maximum terms of the plan are 5 years and 35 years respectively. 

The plan comes with a grace period of 30 days that allows policyholders to assess the policy and return it if found unsatisfactory without paying anything. 

What’s the Need for Term Insurance in UAE?

Planning for the future of one’s family is one of the most important decisions. Buying term insurance, the insured can secure the financial safety of their loved ones, especially in countries like Dubai or other Emirates where the cost of living is higher. The importance of the term Takaful in UAE has been realized of late. However, the main reasons for buying a term life insurance plan include:

• The policy comes at a lesser premium than other life insurance policies.
• The death benefit can be availed by the family in case of the sudden demise of the insured.
• The policy payouts can be customized as per the needs of the insured, it can either be a  lump sum payout or regular monthly payouts.
• As the premiums are comparatively less, the savings can be utilized in planning for other life goals such as retirement, child education, property purchase, etc.
• The policy can be clubbed with different riders in order to get the basic insurance coverage increased. Rider covers such as Critical Illness Cover, Permanent Disability, Accidental Death, etc. can be availed at an additional cost.

Best Term Insurance for NRI

For an individual that is an NRI i.e., a non-resident Indian, there is a wide array of options to choose from that are specifically designed for those who reside outside India. One should opt for a  plan that deems fit in order to secure the future of his or her family members, and protects them in their absence. Most of the plans falling under the best term insurance for NRI are available online and do not require the individual to undergo any medical tests or examinations.

Term plans are pure protection policies and most of them can be purchase by non-resident Indians. Some providers have also streamlined their entire procedure in order to issue term insurance plans to the NRIs.

The important factors that NRIs need to consider before opting for the best term insurance for NRI are:

1. Age: One should not opt for a shorter duration of coverage as that will expose them to the risk of not being covered during the risky years. Opting for term coverage at an older age can be expensive and provides limited or no coverage if the individual has any pre-existing diseases.
2. Inflation: You need to factor in inflation as it plays an important role when choosing your life coverage. The value of your policy tends to reduce in the future due to inflation. Some insurance companies offer coverage that increases every year by a fixed percentage or is indexed to the rate of inflation.

Term Insurance: List of Inclusions

The list of coverage under a term life insurance policy usually includes:

• Death Benefit: In case of the sudden death of the insured, the family members can avail death benefits under a term insurance plan.
• Family Income Benefit: In case of a disability leading to loss of income, where the insured is the sole bread earner of the family, the policy pays a lump sum amount on a regular basis. The amount can be used for paying off the unavoidable day-to-day expenses.
• Family Takaful: Some insurance providers offer family Takaful benefits with an in-built terminal illness cover.
• Financial Protection: The monetary assistance availed from the policy can be  utilized in  paying  off those unavoidable expenses such as:
  • Mortgage repayment
  • Household bills and other day-to-day expenses
  • EMIs
  • Current and future school fees

Key Features & Benefits of Term Insurance

The key features and benefits of term insurance UAE are:

• Simplicity: These plans are simple to understand than the other market-linked or whole life insurance plans. This is the most basic form of life insurance that a layman could understand how it works.
• Affordability: Best term plan comes at an affordable rate. These are the most cost-effective plans, where insurance coverage can be availed at a competitive rate of premium.
• Flexibility:These plans are more flexible in nature. The policy cover is paid in exchange for a premium. When the insured stops paying the premiums, the risk cover ceases. As there is no saving element, there will be nothing payable to the insured.
• No Maturity Value: Term policy doesn’t offer maturity or survival benefit, where only death coverage is offered to the family of the departed.

Types of Term Insurance Plans in UAE

There are various types of term insurance policies available in the UAE. Depending on the provider,  these policies may come with different benefits and features.

• Convertible Term Policy: This policy comes with a limited number of years, which allows the policyholder to convert the term policy into a  whole life insurance policy. The main benefit of this kind of term policy is that the insured is not required to submit any medical test while converting the policy.
• Increasing Term Policy: An increasing term insurance plan allows the policyholder to increase the death benefit with time. However, the premium rate might or might not remain the same during the policy tenure.
• Decreasing Term Policy: Just opposite to increasing term policy, in a decreasing term plan, the sum assured amount reduces each year up to a fixed percentage. The premiums are comparatively lower than a pure term plan and the payments remain constant throughout.
• Level Term Insurance: Under this policy, a fixed constant amount is paid for a claim, regardless of whether the claim is made in the initial stage of the policy or towards the end of the policy term. Moreover, the insurance payments stay the same and there will be one payout only.

Apart from the above, executive insurance, limited payment insurance, etc., are also different types of term plans. Again, it depends on the provider whether it offers all sorts of term plans or just a few of them.

Term Insurance: List of Exclusions

While a term cover protects the insured against the risk of death, there are certain conditions where the term insurance Dubai remains null and void. These include:

• Any claim arising out of suicide or attempt to suicide Death due to self-inflicted injury
• If the reason of death is diseases such as HIV/AIDS 
• Accidental death while driving under the influence of alcohol
• Claim arising for death due to pregnancy-related complicacy or childbirth 
• Any involvement in illegal activities

*For the extensive list of exclusion, kindly consider the policy fine print

Eligibility Criteria for Buying Term Policy

The eligibility criteria for buying term insurance may vary from insurer to insurer, however, the minimum age limit to opt for a term insurance UAE is:

• Entry age: 18 (depending on the insurance provider)
• Maximum age: 65 to 75 years (depending on the insurance provider) 

Documents Required to Buy a Term Insurance

The most common documents required for buying term policy are: 

• Emirates ID
• Residential Visa 
• Recent Photographs

*The documents may vary or the insurance provider may ask for additional documents as per  the discretion of the company

How to Calculate Term Insurance Premium?

Premium is the most important aspect while buying a term policy. Based on the insurance coverage, the premium is calculated. However, by using the term insurance premium calculator, the insurance seekers in the UAE can easily calculate insurance premiums. One can also approach insurance aggregator websites such as Policybazaar.ae to calculate the premium and compare the term plans.

Term Insurance Comparison

Not every plan is the right fit for everyone. For instance, some plans come with basic term coverage, while some others may come with additional features such as a term plan with a critical illness. Hence, to find out the best among the rest for an individual, online comparison of term insurance policies in UAE is essential.  Online comparison helps in getting the right term insurance Dubai as per the insurance needs of an individual. Moreover, one can also find options such as joint term insurance for partners that are looking for a joint insurance account.

Term Insurance Claim Process

In order to claim the term cover smoothly, one should follow the right claim steps, which include:

• Claim Intimation: Whenever a  claim arises, immediately inform the insurer and register the claim by calling on the customer care number of the insurance provider. There might be a claim intimation window after the occurrence of an incident, within which a claim has to be registered, so it is ideal to report it immediately.
• Claim Assessment: Once the claim is registered, the insurer will assess the claim request along with the documents submitted.
• Claim Settlement: After end-to-end verification, the insurer settles the claim amount, and payment is made to the beneficiary’s savings account.

Consider the below table for best term life insurance plans in UAE: