• 7 AUG 2017

    How much life cover do you need?

    How-much-life-cover-do-you-need

    Buying life insurance is important in today’s world where money controls everything. However, the purpose of a term insurance isn’t selfish; it is not about you but it is about the people you love and care about. A term insurance plan looks after your family’s financial needs in your absence. It is better to take measures today to protect yourself and your family.

    A common misconception among people is that once they decide to buy a life insurance policy, they have secured their family’s future. However, this is not the case; buying life insurance is only half the task completed. Choosing the correct life cover and then monitoring it with your lifestyle is also very important. A life insurance policy would serve no purpose to your beneficiaries if the life cover isn’t adequate for them. You must assess all the possible expenses that your family and beneficiaries will encounter in the future in order to decide on the correct life cover.

     The factors that decide your life cover are;

    Income:

    This is the most important factor. After your demise, the life cover your family receives will be a substitute for your income and this money will be used to meet daily household expenses. The life cover must be sufficient enough to provide your family with an amount equal to your income until they are able to be financially independent and fend for themselves.

    Debt:

    Any outstanding loans that you have taken during the course of your lifetime will have to be paid by your family in your absence. Hence, your life cover must be large enough to enable your family to pay off any outstanding debts, so that they are not burdened with a large liability with no resources to clear it off.

    Dependents:

    More the number of dependents, larger the required life cover. A greater number of dependents imply more expenses, more expenses imply the need for more money. You must be extra careful if you have ill parents or a child.

    Future Expenses:

    With increased competition, every parent strives to ensure that their child is better than the rest. In such a scenario, education institutions and coaching classes charge an exorbitant amount. Moreover, sending your child overseas for higher education requires financial planning from the very beginning or he/she may want to start up a business of his/her own, which again needs capital. Your life cover should cover the future expenses of your family.

     Inflation

    With prices of commodities increasing every second, make sure to account for inflation when you decide your life cover. A life cover of Rs.20 lakh may appear big today, but at an inflation rate of 6%, your family would need a much bigger amount in the future.

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  • 13 OCT. 2017

    Get a Comprehensive Life Insurance Plan for Your Family this Diwali

    While tangible gifts form an important part of the rituals between parents and children for the festive season, some intangible gifts hold a deeper value.

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