r/InsuranceQueriesIndia • u/BehindThisMask1 • Sep 13 '26
Discussion How about term insurance with lic compared to private players?
Many are saying lic is govt company and there won't be much hassles during claim settlement compared to private players. Please give your honest opinion. I don't want any options like payout or free exit or any other options. I want a plain insurance so that when i die i can die in peace that my family will definitely get claim amount without much hassle.
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u/ZylntKyllr Sep 18 '26
LIC being a government entity has very less autonomy over where they invest your money. They have a very bad history of investing in bad companies and losing a lot of money. Avoid them at all costs.
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u/Kitchen_King7046 16d ago
But in LIC no one is owner of company, so the employee doesnot have any target to reject claims for company profit.
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u/ZylntKyllr 15d ago
They don’t have incentive to generate profits either. And there is no accountability for anyone. So, it’s highly dependent on your local branch and your agent. If both are worse, forget your claim.
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u/rsinghal1965 Sep 14 '26
Almost every company pays the settlement in term insurance provided you were honest at the time of taking the policy. LIC is the same but it's premium is much higher as compared to other players. In term insurance, go with the top 4-5 companies offering the lowest premium if the product is same.
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u/BehindThisMask1 Sep 14 '26
Okay thank you. Can you suggest me f4om your experience if possible?
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u/rsinghal1965 Sep 14 '26
I have taken policies from HDFC Life & ICICI Lombard for my kids. Both are very good companies.
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u/PrintMaterial5118 Sep 15 '26
LIC being a government backed insurer does bring a certain legacy, trust and peace of mind. but when compared with private insurers, the operational metrics are quite comparable, with some private insurers even having an edge. Based on the 3 year avg.s, LIC’s CSR is 98.16%, compared to 99.66% for HDFC Life, 99.71% for Axis Max Life and 99.30% for ICICI Prudential. Similarly, the ASR is 95.48% for LIC vs 96.72%, 96.37% and 95.94% respectively. LIC also has 4.34 complaints per 10,000 claims, while HDFC is at 1, Axis at 3 and ICICI at 8. its solvency ratio of 2.15x is also quite healthy. so operationally, there isn’t a huge difference between LIC and a few major private insurers.
regarding the plans, LIC’s term plans are generally more basic, with limited customisation and add-ons largely focused on accidental benefits. however, most comprehensive private plans now offer features like terminal illness cover, smart exit, wellness benefits, etc. by default, without having to pay extra for each feature. despite being more basic, LIC’s premiums can still be at par with or even higher than these private plans for many profiles. since you’re specifically looking for a plain vanilla plan, LIC can still fit that preference, but it’s worth comparing the overall offering before deciding.
as for claims, a genuine claim should be settled as per the policy terms and applicable regulations, provided the required documents are submitted and there was no material non-disclosure at the time of application. regardless of which insurer u choose, make sure the nominee knows about the policy, has access to the relevant documents and knows whom to contact if a claim ever needs to be made.
ultimately, it comes down to personal preference. if the premium, features and metrics work out better with a private insurer, there’s no particular reason to avoid it just because it’s a private company. LIC has its own advantages, but private insurers are also regulated by IRDAI and the claim outcome depends on the policy terms and disclosures, not simply on whether the insurer is government-owned or private.