INCOME TAX30 Sept 2026
How much term insurance do you need? Experts explain the right way to calculate your cover | Mint
Buying term insurance is not just about picking 10 to 15 times your annual income. Experts say that rule is only a starting point. Your home loan, children's education, dependent parents, household costs, inflation and existing savings all change the cover your family truly needs. So work out your real protection gap, and add more cover as your income and duties grow.
Key Statutory Highlights
- A cover of 10 to 15 times annual income can be a starting point, but experts say it should not be treated as a universal formula.
- Experts suggest calculating the income your dependants need to replace, adding outstanding loans and future goals, then subtracting your existing assets and insurance cover.
- For goals several years away, consider the future cost of those specific goals instead of simply adding a fixed 6% or 7% inflation rate.
Actionable Advice for Taxpayers / Founders:Review your current term cover against your loans, dependants and long-term goals, and consider taking additional cover if you find a gap, rather than assuming the income-multiple rule is enough.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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