Term Life Insurance Plan for Disabled Persons in India in 2025

When you have a loved one in the family who is a person with disabilities, it lies upon you to ensure that they have a regular source of income in case of your unfortunate demise. In this regard, a term insurance policy for disabled people can be an ideal choice.

It enables your nominees to receive regular income, allowing them to cover their healthcare and other expenses without depending on an alternative source of income.

Keep reading for a comprehensive insight!

A term insurance policy for disabled people is a special insurance plan that enables you to set a person with disabilities as the nominee. In case of your unfortunate death, they receive regular payments instead of a lump sum death benefit, which continues till the individual’s demise.

The policy tenure in this regard ranges to a maximum of 35 years, and the premium amount and sum assured are calculated based on the dependent’s age and financial requirements. You can pay the premium either via a single payment or periodically. Also, you can go for optional benefits to secure your dependent by paying a higher premium amount.

Yes, according to the Insurance Regulatory and Development Authority of India (IRDAI), disabled individuals can purchase a term plan to safeguard their families financially.

In this regard, the underwriting process is exactly the same as for other individuals, with the insurer assessing the individual’s health stats, lifestyle, mortality rate, etc., to determine the coverage and premium amount. Additionally, the company will analyse the severity of the disability, its underlying causes, and associated risks (if any).

However, for applicants with severe disabilities or disabilities that could potentially cause complications, the term plan can have higher premiums or limited coverage options.

Below are the reasons why term insurance plays a vital role in securing the future of disabled persons in India:

• Provides financial security for disabled dependants.
• Ensures regular income for the beneficiary throughout the individual’s life.
• The coverage amount can be used to cater to all types of expenses, like household, medical, debt, and more.
• Enables the policyholder to make sure that the disabled dependant can easily cater to their expenses without depending upon an alternate income source.

The features and benefits of term insurance for disabled persons are as follows:

• Flexible policy terms enable holders to choose a tenure that best aligns with their requirements.
• Optional add-ons and riders allow the policyholder to customise the plan’s coverage.
• Section 80C offers deductions up to ₹1.5 Lakh for term insurance premium payments within a financial year.
• Section 10(10D) provides complete exemption on the death benefit from a term insurance plan for a disabled person.
• Section 80D facilitates a maximum tax deduction of ₹25,000 (for normal) and ₹50,000 (for senior citizens) on annual premium payments for health riders or medical insurance purchased with term insurance plans.

Selecting the Right Coverage Amount

Policy Tenure and Premium Amount

Check whether the policy period aligns with your requirements. Also, you must choose a premium amount you can pay throughout the policy tenure without straining your monthly finances.

Remember, failing to pay insurance premiums can lead to penalties and even a policy lapse.

Insurer’s Credibility

Buying a term plan for a disabled person is a long-term commitment related to the financial security of your dependent beneficiary. Thus, you must ensure that the insurer will fulfill their promise in case of your unfortunate demise during the policy tenure.

Research the insurance company’s goodwill and claim settlement ratio to do so. Also, remember to review the policy’s terms and conditions.