HDFC Life Click2Protect Life Term Plan – Features & Review

Life is an unpredictable journey. It can take sharp, fatal turn at moments, which are capable of leaving one physically, mentally, emotionally and financially bruised. Many of us ignore buying a life insurance plan with adequate insurance cover.

You may currently have a life insurance policy, but, you need to evaluate yourself if the existing Sum Assured is sufficient or not.

If you are an earning member of your family and you believe that you are currently ‘under insured’ then its HIGH-TIME you buy a TERM LIFE INSURANCE PLAN.

You may go through my article @ Different types of Traditional Life Insurance Plans | Which one should you buy?, to understand how different types of life insurance plans work.

HDFC Life has recently launched their latest online Term plan called – HDFC Life Click2Protect Life. You may take a look at this plan!

In-fact, you may buy a term plan (preferably an online policy) from any life insurer of your choice. (Read : Top 5 Best Online Term Life Insurance Plans 2020 | Comparison & FAQs)

In this post, let us discuss – What is Term Life Insurance Plan? What are the features of HDFC Life Click2Protect Life Term Plan? What are the plan options under HDFC Life Click 2 Protect Life New Term Insurance Plan? Should you buy HDFC Life’s latest Term life insurance plan? Is ‘Click2Protect Life’ the best term plan?

What is a Term Insurance plan?

Term insurance is the simplest and most fundamental insurance product. These insurance plans are designed to ensure that in the event of the policyholder’s death, the family gets the sum assured (the cover amount).

Term plan provides risk coverage for a certain period of time (policy term/duration). If the insured dies during the time period specified in the policy and the policy is active – or in force – then a death benefit will be paid. It is the cheapest form of Life insurance in terms of premium.

HDFC Life Click2Protect Life | New online Term Life Insurance plan

HDFC Life’s latest flagship term product Click 2 Protect Life is a non-linked, non-participating, individual term plan.

The unique feature of this new term plan is – it offers three different Plan options as below;

• Life Protect Option(basic plan)
  • Under this plan option, a lump sum is provided on death of the life assured.
• Life Cover + Income Plus option
  • Under this plan option, the Life Assured is covered for the entire policy term and also receives a lump-sum payout on maturity along with regular income starting from age 60.
• Life cover + Critical Illness Re-balance option
  • This plan option aims to provide a balance between Death and Critical Illness benefit as you go along in your life. Critical Illness cover increases at each policy anniversary with corresponding reduction in Life Cover. In addition, all future premiums are waived off on detection of any of the covered Critical Illnesses and the life cover continues.

Below are the basic eligibility conditions under each Plan option;

Plan Options under HDFC Life’s Click 2 Protect Life Plan | Illustrations

Let us now understand, how each plan option works with illustrations.

Life Protect Option

This is a basic and pure term plan option. Under this plan option, a lump sum is provided on death of the life assured. Below example helps you in understanding the working of this plan option:

• Under this option, your premium paying term and policy term can be different.
• You have the option to choose the life cover for a fixed term (or) whole life.
• You can not opt for Critical Illness and Income Plus options with this plan option.
• The premium under this plan option is the cheapest among the three plan options.
• Add-on benefits like return of premium, waiver of premium on diagnosis of certain Critical illnesses & Accidental death benefit rider are available under Life Protect option.

Life Protect with Income Plus Option

Under this plan option, the Life Assured is covered for the entire policy term and also receives a lump sum payout on maturity along with regular income starting from age 60.

An income equal to 0.1% of Basic Sum Assured will be payable to you at the end of every month, following policy anniversary after your attaining age 60 years, until death or end of the policy term, whichever occurs first.

Below example helps you in understanding the working of this plan option:

• Under this option, your premium paying term and policy term can be different.
• This option can be taken for a fixed term or whole-life.
• Return of Premium feature is in-built in this plan option (for a fixed tenure policy).
• The premium payable under this plan option is higher when compared to Life Protect option.
• Add-on benefits like return of premium, waiver of premium on diagnosis of certain Critical illnesses & Accidental death benefit rider are available under Life Protect option.

Life Protect & Critical Illness Rebalance Option

Under this plan option, Basic Sum Assured chosen by you is split between Life Cover Sum Assured and Critical Illness Sum Assured.

At the beginning of the cover, Life Cover SA is set at 80% of Basic Sum Assured and CI SA is set at 20% of Basic Sum Assured. For an in-force policy, at every policy anniversary, starting from the first policy anniversary, CI SA will increase every year and Life Cover SA will decrease by the same amount. This amount will be calculated as follows:

(30%  X Basic Sum Assured) ÷ Policy Term.

Once a Critical Illness claim is made, the Life Cover SA will be fixed at the then applicable level and the same SA will continue until the end of policy term.

Below example helps you in understanding the working of this plan option:

Mr. Shetty, a 45 years old gentleman, buys the Life & CI Rebalance option of HDFC Life Click 2 Protect Life for a policy term of 20 years, regular pay, and avails a basic sum assured of Rs 1 crore. He pays a premum of Rs 64,700 pa.

He is diagnosed with a Critical Illness in the 7th policy year. His future premiums are waived off and he receives Rs 29 lakh as lump-sum Critical Illness benefit. His Life Cover Sum Assured is now fixed at Rs 71 lakh.

Mr. Shetty passes away in the 13th policy year. His nominee will receive a lump sum death benefit of Rs 71 lakh.

The below table lists out the main benefits that are available under the above discussed three plan optons;

My Views on HDFC Life’s latest Term plan – Click2Protect Life

If you are planning to buy a life insurance plan with an adequate life cover (sum assured) at affordable premium rate then Term insurance plan is the best choice. There is no doubt about this! But do we need to have these many options under a Term insurance plan. Is n’t it a simple life cover option enough?? Yes, a term plan with just a basic cover is more than enough to meet your life cover requirement.

Below are some of the points to ponder upon when considering ‘Click 2 Protect Life’ policy;

• More Options, More complexity : To be frank, I have spent good amount of time to go through all the options & scenarios available under this plan and to comprehend these options. If you are considering to buy this plan, you have to carefully go through all the rules and eligibility conditions that are applicable under each option / feature.
• No Comprehensive Plan option : If you notice the above Plan option table, none of these plan options has all the available features. For example : You can not opt for Critical Illness option for whole-life. Also, you can not opt for life cover + CI + Income options under one policy.
• More Features, Higher Premium Rates : If you look at the premium quotes, a basic life cover option ‘Life Protect’ is available at affordable premium rates, whereas, if you would like to have more features (Regular income or CI) to the base plan, it comes with a price!
• Template Based Benefits Structure : Life will not pan out as planned. You can notice that the benefits under Regular income and Critical Illness options have certain template based rules.
  • Under Income Plus option, you will receive regular income only from 60 years and not before you attain 60 years of age. Also, an income equal to 0.1% of Basic Sum Assured is only payable.
  • Under the CI plan option, the re-balancing between Life cover SA and CI SA works automatically.
• No Comprehensive Permanent Disability Cover : Kindly note that this plan has an in-built feature of ‘waiving of premiums on Accidental Total Permanent Disability’ under plan options.  But, no lump sum benefit or fixed regular amount is not payable on total permanent disability. I believe that one should not only consider a Term plan with adequate life cover but also should take a comprehensive Personal Accident Policy, which provides Accidental Death Benefit and also covers Accidental Total Permanent Disability. So, either you need to add a separate Accidental Death Benefit Rider to this plan or has to take a stand-alone Personal Accident Insurance policy.
• No Comprehensive Critical Illness cover – Same as the above point. You may have to take a separate CI rider or CI plan. Also, Critical illness feature is available on diagnosis of certain conditions only.
  • No benefit shall be paid in case the Life Assured is diagnosed with any of the listed Critical Illnesses within 90 days from the date of commencement of policy.
  • The insured has to survive 30 days after the ‘complete diagnosis’ of the defined critical illness condition being claimed and subject to fulfillment of policy definitions.
  • When I was trying to calculate the expected premium under this new term plan, have been asked with below questions. I have noticed that if I select ‘YES’ for either of these questions (or) both the questions then CI plan option is not available.

• Monthly Income Options : You need to select the monthly income (quantum) and its term (income period) at the inception of the policy itself. An individual’s life can not be predicted in advance. It’s not prudent to fix a monthly income / period now and pay premiums as per this selection. You can instead plan for building your retirement corpus by investing in plethora of investment options as per your profile.
• Change of Plan Option? – The Plan option once chosen at inception cannot be changed throughout the policy term.

Term insurance plan from any life insurance company should be ok. You need to just opt for a base cover as per your requirements / affordability and disclose all the required information in proposal form accurately. In case, you have shortlisted HDFC Life as your preferred insurer, you may consider Life Protect Option.

Besides a Term plan cover, make sure you maintain adequate Emergency Fund and get adequate Health Insurance cover as well.

Continue reading :

1. How much Term Life Insurance Cover do I need? | Online Insurance coverage Calculator
2. LIC New Plans 2020 – 2021 List | Features, Snapshot & Review of all the Plans
3. IRDA Claim Settlement Ratio 2018-19 Data | Top 10 Life Insurance Companies based on CSR
4. What is an Emergency Fund? | Why, Where & How much to save?
5. Top Up Health Insurance Plans – Super Top Up Health Insurance Plans – Details & Benefits

Kindly note that Relakhs.com is not associated with HDFC Life. This post is NOT a sponsored one. We have not received any monetary benefit for publishing this article. This post is for information purposes only.

(References & Infographics source : HDF Life portal & Click2Protect Life Product Brochure) (Post first published on : 30-January-2021)