How Much Term Insurance Cover Do You Need?

Quick answer

Term-cover scenarios can be linked to the financial gap your family would face: income replacement, debts, future goals, and existing savings or cover. A fixed “10x income” rule can be too rough.

When this matters

This is useful when you want to compare scenarios using your own numbers instead of generic rules. It is designed for Indian households using Niyamfin calculators for private, browser-side estimates.

Key numbers or assumptions

• IRDAI regulates insurance and hosts product/policy information; always read insurer documents before choosing any policy.
• Term insurance is protection, not an investment return product.
• Cover needs change after marriage, loans, children, and major asset changes.

Example calculation

If the family needs Rs 15 lakh a year for 15 years, has Rs 30 lakh of loans, and has Rs 20 lakh of usable assets, the protection gap is not just a salary multiple. The calculator helps estimate this gap.

Common mistakes

• Choosing cover only for tax saving.
• Mixing investment return expectations with pure protection needs.
• Forgetting existing loans and education goals.

What to do next

Estimate the gap, compare policy features from insurer documents, and disclose health details accurately.