Imagine this. You’re 30 and just starting to build a life. You have a growing career, a young family, maybe a new home loan. You’ve worked hard for this moment. And deep down, you also recognise one thing: if something was to happen to you, your family’s future must be secure. So, you do what every responsible person does. You consider a term insurance plan.
But when you look at the options, an unexpected thought crosses your mind: “If I double my cover, won’t I have to pay double the premium?” Logically, that’s how it is supposed to work.
But here’s the reality. In term insurance, the pricing doesn’t work like that. It’s called “non‑linear premium” pricing, and it’s precisely why opting for a higher cover now could be the smartest decision you’ll ever make. Let us understand how and why.
What is a non‑linear premium?
Simply put, in term insurance, doubling your cover doesn’t double your premium. In fact, it doesn’t even come close. For example, at age 30, a ₹1.5 crore cover might cost roughly ₹1,250 per month. But if you increase that cover to ₹2 crore, you’ll only pay roughly ₹1,500 per month. That’s an increase of just about 20 per cent for around 35 per cent more cover.
And that is how it works in every context. As you go for a higher and higher cover, the increase in premium becomes proportionally smaller and smaller. In other words, the higher cover translates to better value for every rupee you spend.
Why this matters today
What worked for you five years ago won’t work five years from now. Inflation is a quiet force that chips away at the value of money every year. What feels like a “decent cover” today may be grossly insufficient by the time your family needs it. Add rising liabilities to that, like home loans, education expenses, medical emergencies, and suddenly the gap grows wider.
A ₹50 lakh cover may have felt like a good number a decade ago? However, today, it’s worth far less. A ₹1 crore cover is the new norm today. But if you want to plan for the future, you should aim higher.
Perhaps a ₹2 crore cover. And with non-linear pricing, the good news is that you need not pay proportionally higher premium. A reasonable increase in premium can tremendously increase your cover.
That’s the cushion your family can lean on when life doesn’t stick to the script.
If you’re in your 20s or 30s, you have the biggest edge. You can lock in lower premiums for higher covers when your health and age work in your favour. The cost of coverage only goes up as you age. You’re safeguarding the future when it’s still affordable.
For example, at 30, going from ₹1.5 crore to ₹2 crore means only roughly ₹50 more per month. At 40, that difference can be almost double. At 50, it can be even more costly. So it is always better to secure higher coverage early, when it’s cheaper and available, rather than wait until the premium is steep and medical conditions arise. Because in life, the biggest returns often come from acting early, choosing wisely, and making sure you’re always prepared for the moments that matter.
Financial sense meets peace of mind
Higher cover doesn’t just make financial sense, it delivers emotional peace too. It means knowing that if the worst were to happen, the mortgage will be paid, the children’s education will continue uninterrupted, the medical needs of aging parents will be met, and the family’s lifestyle and aspirations will be protected.
And this is precisely why term insurance is important. It is a tool that grows with you and your family, making sure that when life takes an unexpected turn, your loved ones don’t have to compromise.
And non‑linear premium pricing is one of the biggest benefits of term insurance, one that too many people overlook. It allows you to secure significantly higher coverage at a fraction of the cost, making it one of the smartest financial decisions you can make for yourself and your family.
Life doesn’t wait. Inflation doesn’t wait. Liabilities don’t wait. Why should you? Evaluate your cover today, increase it while you can and lock in a premium that gives you maximum value for every rupee you spend.
At the end of the day, term insurance isn’t just about cost. It’s about making sure your story, and the story of those you love, doesn’t end when life takes a turn.
The writer is head of term insurance at Policybazaar.com