2.5 Crore Term Insurance

A ₹2.5 crore term insurance plan is an ideal coverage option for individuals with growing income and bigger financial goals. It ensures your family won’t have to worry about money if something happens to you. Let’s explore what a ₹2.5 crore term insurance is, how it works, its benefits, who should buy it and why the ACKO Life Flexi Term Plan is worth considering with such a cover.

A ₹2.5 crore term insurance plan is an ideal coverage option for individuals...

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What is a ₹2.5 Crore Term Insurance Plan?

A ₹2.5 crore term insurance plan provides a sum assured of ₹2.5 crores to your nominee in the unfortunate event of your death during the policy term. It is a pure protection plan designed to secure your family’s financial future by replacing lost income and covering major liabilities.

Unlike investment-linked insurance plans, a term policy offers no maturity benefit. Therefore, if you outlive the policy term, no payout will be made unless you have opted for additional riders or return-of-premium features.

How Does a ₹2.5 Crore Term Insurance Plan Work?

Here is a breakdown of how a 2.5 crore term insurance plan works:

Selection of Sum Assured

You choose the sum assured, which in this case will be ₹2.5 crore. The insurer evaluates your health, age, medical history, and other factors to determine your insurability and premium.

Policy Term

You choose how many years you want the cover (for example, 20, 25, 30 years). The term insurance plan remains active during this period.

Premium Payments

You pay premiums (annually, half-yearly, quarterly or monthly) to keep your policy in force.

Death Benefit

If you pass away while the policy is active, your nominee files a claim. Upon claim approval, the insurer will pay ₹2.5 crores to your nominee. If you survive the term, no payment is made.

Benefits of a ₹2.5 Crore Term Insurance Plan

The key advantage of a ₹2.5 crore term insurance plan lies in its comprehensive coverage. It can help your family manage outstanding loans, daily expenses, education costs and future goals while keeping inflation in check. So, let's look at some of the key benefits of having a ₹2.5 crore term insurance in place:

Strong Financial Protection

A large sum assured of 2.5 crore ensures your family can cover liabilities as well as ongoing expenses without worrying about running out of funds.

Peace of Mind

Knowing that your loved ones have a strong safety net lets you live with confidence.

Affordability

Even though ₹2.5 crore sounds huge, for high-income individuals, the premium is often affordable.

Tax Benefits

Premiums paid are deductible under Section 80C of the Income Tax Act, and the death benefit is generally exempt under Section 10(10D) for term insurance.

Legacy Planning

A ₹2.5 crore payout can help settle your assets and finances smoothly, clear any outstanding dues. This ensures your heirs aren’t burdened financially.

Who Should Buy a ₹2.5 Crore Term Insurance Plan?

A ₹2.5 crore term insurance plan is best suited for individuals with higher income, larger responsibilities, or long-term financial goals. Here’s who can benefit the most:

High Earners/Professionals

Doctors, corporate executives, business owners, tech professionals, etc., whose income is large and supports the family’s lifestyle.

People With Large Liabilities

If you have big home loans, business loans, educational loans or other debt, a higher cover ensures your dependents are not burdened.

People Planning for Future Commitments

If you foresee large future costs like children’s studies or parent care, a higher cover is helpful.

Those with Multiple Financial Goals

If you want your term insurance to serve multiple purposes (protect your family, leave an inheritance, support retirement, etc.), a higher sum is beneficial.

Important Things to Know Before Buying a ₹2.5 Crore Term Insurance Plan

Before finalising on a ₹2.5 crore term insurance, examine:

Claim Settlement Ratio and Insurer Reputation: A high claim settlement ratio signals reliability at the time your family will need it.
Rider Options: Check if the plan allows adding useful riders like critical illness, accidental death, disability income, etc.
Payout Option: Choose between lump sum, monthly payouts, or a hybrid option. A large payout may be better for clearing big expenses or loans, but a monthly payout can help steady income.
Premium Affordability: Ensure the premium remains affordable over the years.
Exclusions and Waiting Periods: Be clear about when death is not payable (e.g. suicide clause, pre-existing illness, waiting period, etc).
Policy Revival/Grace Period: If you miss a premium payment, does the policy lapse permanently, or can it be revived? Be aware of all the conditions set by the insurer before making a purchase.
Documentation and Claim Process Ease: Discover how easy it is for the nominee to file a claim, and if there are any hidden formalities.

Top Reasons to Pick ACKO’s ₹2.5 Crore Term Plan

The ACKO Life Flexi Term Plan is designed for individuals seeking comprehensive, adjustable coverage with flexibility and transparency. Here is what makes it stand out:

Flexible Coverage: Increase your sum assured at any point to match changing financial needs.
Digital and Paperless Process: From policy purchase to claim filing, everything happens online with minimal paperwork.
Premium “Lock” Benefit: Whenever you want to increase your coverage amount, the premium is calculated at your entry-age rate, protecting you from future premium hikes.
For example
-If you're 30 years old in 2025 and buy a term plan with a ₹2.5 crore sum assured.
-Later, in 2035, when you turn 40, you decide to increase the coverage to ₹3.5 crore.
-The premium will be calculated as if you're a 40-year-old in 2025, not in 2035.
-This protects you from paying higher premiums that would normally apply to a 40-year-old in 2035.
High Claim Settlement Ratio: With a claim settlement ratio of 99.38%, ACKO demonstrates strong reliability in claim handling.
Extra Perks: Includes features such as free will creation, easy nominee updates, and riders for added protection.

Conclusion

A ₹2.5 crore term insurance policy is a strong financial planning choice for high-earning individuals or those with substantial liabilities. When buying such a policy, you must evaluate the insurer's reputation, flexibility, riders, affordability and claim process. If chosen wisely, a ₹2.5 crore term insurance can offer long-term peace of mind and financial security for your loved ones.

Frequently Asked Questions

Is it safe to buy such a high sum assured like ₹2.5 crores?

Yes, it’s completely safe to buy a high sum assured like 2.5 crores, as long as you choose a trusted insurer and share accurate details while applying. Insurers are regulated by the IRDAI, so your money and claim rights are protected.

Will I have to undergo extensive medical tests for a ₹2.5 crore term insurance?

Most likely yes. Insurers typically require health checkups, lab tests, and medical history, especially for large coverage.

Can I increase the sum assured later if I started with a lower cover?

Yes, but it depends on the policy. The ACKO Life Flexi Term Plan allows you to increase the sum assured.

What happens if I miss paying premiums?

You usually get a grace period. If the policy remains unpaid, it may lapse. Some policies allow for revival within a certain time frame. Always check the revival and grace period terms before buying.

Does a ₹2.5 crore term plan cover accidental death or critical illness by default?

Yes, accidental deaths such as road accidents, falls, or injuries are covered under a basic term plan. However, you can add an accidental death rider for extra protection. Critical illness is not covered by default, so you’ll need to add a critical illness rider for that benefit.

Are premiums for ₹2.5 crore term insurance tax-deductible?

Yes, premiums qualify for tax deductions under Section 80C, and the death benefit is generally tax-free under Section 10(10D).

If I survive the policy term, do I get anything?

No. Term insurance is a pure risk cover, so there is no maturity benefit.

Why choose ACKO for a cover of 2.5 crores?

ACKO offers flexible coverage with the option to increase or decrease your sum assured based on your changing needs. It provides a fully digital process and a high claim settlement ratio, making it easy and reliable to manage your ₹2.5 crore plan online.

Written by Neviya Laishram

1.7K Linkedin Followers

Reviewed by Vaibhav Kumar Kaushik

A senior editor with years of expertise, she fine-tunes content that connects, converts, and builds trust. She transforms heavy life insurance concepts into clear, aha-moment reads. Writing is her passion, and thinking ahead is second nature. When not wrangling words, she’s crushing game levels because every challenge is a puzzle waiting to be solved.