On-line term insurance-Puzzled with anomaly in premium structure

POSTED BY Saket ON January 23, 2012 11:34 am COMMENTS (5)

HDFC Click 2 Protect offers me Rs 50L coverage at a premium a good Rs 2k less than that for a coverage of Rs 40L!!!!!  Not very logical.

Interestingly, the preiums againg rise from 50L to 60L.

I am sceptical why Rs 50L coverage comes at a lower premium than  Rs 40L coverage?  Is there a reason like more stringent medical fitness critera for Rs 50L coverage ? or  a different eligibility criteria like- finacial status / living condition etc? I must know the exact reason before going for the more tempting offer of Rs 50L coverage (less premium and higher coverage than Rs 40L). 

Haven’t found a logical answer to this even after talking to umpteen number of customer service execs on the helpline. All they say is exclusions and the terms of coverage are same in both cases.  And the premium depends upon our internal calculations which is normally not shared bha bhah…..

 My simple argument is- How come the mortality rate (for the same perosn) considered for Rs 50L can be less than that considreded for Rs 40L coverage? 

While the insurers expect us to be completely fair and honest in revealing the facts in our application, I get a feeling that there is something that the company is unwilling to disclose! And that’s the least we expect in a contract like term insurance which is based on faith.

Please share your views.

5 replies on this article “On-line term insurance-Puzzled with anomaly in premium structure”

  1. Saket says:

    And in case of HDFC Standard Life, within the 25L-50L slab, there seems to be different underwritting norms for 40L and 50L coverage.

    It seems like this- As we enter into a higher coverage slab, we encounter a discount in premium, however this discount may usually be accompanied by a different underwriting norm (physical fitness etc.), and this new underwritting norm may lead to increase in the originally discounted premium rate for a particular person.

  2. Anand says:

    The following pdf file should help you.


    The different ranges are:

    10 – 25 lakhs
    25 – 50
    50 -75
    75 – 100

    So if somebody is taking policy of say 23 lakhs, he/she is better of with policy of 26 lakhs instead.

    1. Saket says:

      That’s correct Anand! But there could be a different underwriting criteria for 26L coverage. That’s what I learnt from a reply from Manish to my query in

  3. Dear Saket, You are not alone to pointing this so called error. for your kind information, this is not an error & you may check the same for each & every online policy.

    There is a thing called discount for tabular prem. for higher sum assured. So whenever your prem. crosses a certain cut off point like 50L in your example or 1 crore again on higher band, the prem. ‘ll come down to a lower level due to this discount.

    Similar discount of high sum assured you may check for LIC policies like Jeevan anand & other traditional product.

    Please check on your own & update us.



    1. Saket says:

      Thanks Ashal Jauhari for replying to my question. I get your point.

      I had posted this question also at


      and got similar reply from Manish who touched the aspect of medical tests too.

      Manish has quoted a communication from Aegon Religare’s executive in his reply which speak on the same lines as you have said.

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