At GoalTeller, we understand that securing your family’s future is one of the most important decisions you’ll make. Life insurance ensures that your loved ones can maintain their lifestyle and achieve their dreams, even in your absence. But how much insurance do you really need?
Income replacement: Supporting your family’s lifestyle
We recommend starting by looking at income replacement. A good rule of thumb is to have life insurance that’s 10-15 times your annual income. This ensures your family can continue meeting their living expenses for years to come.
For example, if you earn ₹10 lakh annually, a policy worth ₹1-1.5 crore ensures your family can maintain their standard of living for 10-15 years, giving them enough time to adjust.
Cover your debts and liabilities
Don’t forget to account for your outstanding debts—home loans, personal loans, or any other financial obligations. After all, those EMIs won’t disappear. If you owe ₹30 lakh on your mortgage, make sure this is covered in your insurance policy to avoid passing the burden on to your family.
Future goals: Securing education and retirement
Life insurance should also cover future expenses like your child’s education, marriage, or your spouse’s retirement needs. For example, if your child’s education is expected to cost ₹25 lakh in the future, include this in your coverage. Consider your spouse’s post-retirement plans as well, so they aren’t left financially vulnerable.
Subtract existing assets
If you’ve already built up a savings corpus or other investments, you can subtract these from your total insurance needs. For example, if you have ₹20 lakh in assets, this reduces the required life insurance cover, ensuring you’re not over-insured.
Adjust for inflation
Make sure to account for inflation. The cost of living will rise over time, and your insurance policy should reflect that. An insurance policy that looks like enough today might fall short 20 years down the road. By factoring in inflation, you’ll ensure your family’s needs are sufficiently met.
Personalise your life insurance with GoalTeller
At GoalTeller, we believe that life insurance isn’t one-size-fits-all. Your coverage should be tailored to your family’s unique needs, from replacing your income to covering debts and future financial milestones. By using the 10-15 times income rule, factoring in liabilities, and accounting for inflation, you can secure the right amount of coverage without overpaying.
Our team is here to help you calculate the exact coverage your family needs to stay financially secure in your absence. Let's build a personalised plan together, ensuring peace of mind for you and your loved ones.
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